Message Image  

Open Forum

  • 1.  Half year rule for fixed asset additions

    Posted Sep 08, 2021 11:26 PM

    I have several fixed asset cards where I need to record additions monthly. I need the additions to follow the half year convention/rule, while the original book value of the asset depreciates normally.

    Does anyone know how I can make this work? The half year rule works during the first year of the fixed asset card, so any additions will not follow it. The only method I can think of is creating a new fixed asset card just for the addition and at year end combining it with the original asset, however this would entail creating 12 additions assets (one for each month) for each original asset so I'd like to stay away from this if possible.

    andy doghart

  • 2.  RE: Half year rule for fixed asset additions

    Posted Sep 09, 2021 08:46 AM
    The 'Use Half-Year Convention' flag is set on the FA card in the Depreciation Book setup which applies to everything on that FA Card so I don't see a way to split the half-year consideration.

    Would it be possible to combine the monthly additions on one FA Card?  Then at the end of the year, you only have 12 additional FA Cards. You can enter each Asset's additional  Acquisition Costs individually for an audit trail later but if they are all dated the same day, they will all be on the same depreciation schedule and the system will calculate one monthly depreciation amount based on the total of all the Acquisition Costs. One option.

    Another option is selecting 'Manual' for the Depreciation Method for these assets instead of using one of the included depreciation methods since none of them really fit your needs. When using 'Manual', you type in the asset and the amount you want to post for depreciation each month. It would require you to calculate the amount outside the system and manually create the monthly entry BUT that may be easier than creating the extra FA Cards.  You can use the Recurring Fixed Asset Journal to short cut some of the manual entry.

    Then other possibility is to create your own Depreciation table. Search on 'Depreciation Table' and then after creating your own schedule, associate that with the Depreciation Book. I'm still not seeing a way you could apply one depreciation method to some of the entries but not to other entries on the same asset so not sure if this would work but I'm not a math whiz.  Maybe there is a algebraic formula that would work?

    As always, I suggest testing anything to do with Fixed Asset calculations in a TEST database before trying it in your production database.

    Let us know you come up!

    Crystal Tollison
    Innovia Consulting
    Onalaska WI

  • 3.  RE: Half year rule for fixed asset additions

    Posted Sep 09, 2021 09:43 AM
    I haven't seen this requirement too often, but I think the best way to do this would be to create separate Fixed Asset records for each one and code them in a way that reflects they are all related.  What you can also do is assign each of these as "Components" to the "Main Asset" so that they are formally linked together for reporting and inquiry purposes within the system.

    Ken Sebahar
    Solution Systems, Inc.
    Podcast: A Shot of Business Central and a Beer!

  • 4.  RE: Half year rule for fixed asset additions

    Posted Sep 09, 2021 09:48 AM
    I don't usually see a requirement like that. But, Ken is right you can create a separate fixed asset. You can also use the class and subclass to identify that the fixed asset are same group them assign it as components to the main asset.



  • 5.  RE: Half year rule for fixed asset additions

    Posted Sep 09, 2021 02:18 PM
    If this is an ongoing process where you are adding to existing fixed assets, I would change the Depreciation Method to User Defined and set up Depreciation Tables.  Depreciation Tables allow you to use a percentage that calculates each month's depreciation over the life of the asset.

    Robb Delprado
    Senior Trainer and Consultant
    New View Strategies
    Houston, TX

If you've found this thread useful, dive deeper into User Group community content by role