Entering content frameProcess documentation Manual Planning of Depreciation 

Purpose

As a rule, the system automatically determines the planned depreciation for the current fiscal year by means of the depreciation keys entered in the master record. If you need to specifically set the amount of depreciation, the system offers a manual depreciation forecasting option. This means you can manually increase the planned values managed for the asset. You can generate manual depreciation amounts for all depreciation types, but it is more common to manually generate unplanned depreciation and the transfer of reserves.

There are several different types of manual depreciation that can be differentiated according to the reason that manual depreciation is required:

  • There is an unexpected permanent reduction in the worth of the asset that you have to post as unplanned depreciation.
  • You have special tax depreciation that you only partially take into account.
  • You are using unit-of-production depreciation and want to manually plan depreciation, rather than using the depreciation key.

Process Flow

In order to forecast manual depreciation, you can use the standard posting transaction in Asset Accounting. The system provides special transaction types that enable you to forecast depreciation in relation to specific areas, or for all areas that use the corresponding depreciation type, in one stroke.

Updating in the General Ledger

The G/L accounts in Financial Accounting are not initially affected by this posting transaction. Asset line items are created, but no FI posting documents. The general ledger accounts are updated and the corresponding FI documents are created by the periodic depreciation posting run. The system then determines the depreciation to be posted up to a specific period, and creates the accompanying posting documents.

Asset Value Date

The system does not initially produce posting documents for manually planned depreciation. These documents are not created until you carry out the periodic depreciation posting run. However, you can still enter an asset value date when you plan manual depreciation. Depending on your Customizing settings for the depreciation posting run (that is, the posting procedure used), this date can have one of these effects:

  • If you use the catch-up method, the posting document is not created until the posting period (posting run) in which the asset value date falls.
  • If you use smoothing, the asset value date has no effect. The system distributes manually planned depreciation to the remaining posting periods, regardless of the asset value date.

Caution

Note that ordinary depreciation and special depreciation can only be posted manually if No automatic calculation is the depreciation method set in the base method of the depreciation key entered in the depreciation area.

Correction of Unplanned Depreciation

As soon as the reasons for the unplanned depreciation no longer exist, you normally have to reverse the effects of the unplanned depreciation. Therefore, we recommend that you use different transaction types for each type of reason you have for claiming unplanned depreciation. In order to make later correction of unplanned depreciation possible, you should set the Manage historic. indicator in the master record of the fixed asset concerned. Setting this indicator makes it possible later to select the posted depreciation by transaction type. You then post the correction of the unplanned depreciation by reversing the unplanned depreciation already posted (in the current fiscal year) or by posting a write-up (in following years).

 

 

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