For the declining-balance method of depreciation, the fixed asset is depreciated by a progressively falling rate. A constant percentage rate is calculated from the expected useful life and a given multiplication factor. This is multiplied with the falling net book value of the fixed asset. For mathematical reasons, the net book value will never reach zero using this method. You change over to straight-line or complete depreciation under these conditions:

• Declining-balance depreciation < straight-line depreciation
• Net book value < x percent of acquisition value
• Net book value < fixed amount
• Net book value < straight-line depreciation

The changeover method is specified in the internal calculation key.

Depreciation = net book value * percentage rate from expected useful life and factor