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Depreciation calculation based on net book value

AmitavaSaha
Explorer
0 Kudos
221

Hi All, 

We have two separate requirement as below.

Scenario-1 

Asset depreciation is calculated based on useful life. But after change of useful life depreciation need to be calculated based on available NBV in the remaining useful life, 

Example-

Asset:- Initial useful life- 7 years

Asset acquisition on 07.02.2025 for 20,000

As per UL 7 years depreciation has been posted for two periods, 238.09 per month.

Then UL changed from 7 years to 1 year and below is the impact in depreciation.

After that UL change from 7 years to 1 years and then depreciation calculated as 20000/12=1666.67.

but the requirement is depreciation to be calculated as below:- 

Depreciation posted for two month--> 238.09+238.09= 476.18

NBV-20000-476.18=19523.82

So depreciation should be 19523.82/12=1626.98

Please let me know how can we achieve this.

Regards,

Amitava

 

 

 

 

 

 

 

 

 

Accepted Solutions (0)

Answers (3)

Answers (3)

VijaykumarV
Participant
0 Kudos

Hi @AmitavaSaha 

Did you check LINS depreciation key, it should have remaining useful life checked. Please check and make sure remaining useful life is checked for that particular depreciation key. 

 

Regards

Vijaykumar

 

VijaykumarV
Participant
0 Kudos

HI@AmitavaSaha 

For your requirement, you can use depreciation key LINS or copy LINS and create Z* Depreciation key. 

Depreciation key LINS calculation is based on NBV and remaining useful life.

NOTE - Don't worry about LINS is straight line method. It will give result as per WDV remaining useful life only as calculation results will be same for both. You can test in Dev or Quality for checking, 

Just  check and confirm. This should work as per your requirement.

 

Regards

Vijaykumar

AmitavaSaha
Explorer
0 Kudos

Hi Vijay,

Thanks for your quick reply.

I have checked with LINS depreciation key, but it is not working. Still it is taking the Acquisition value as base value for depreciation calculation and not considering the NBV which comes after two depreciation posting of first two periods.

Regards,

Amitava

 

Walagrof
Explorer
0 Kudos

2 scenarios, 2 solutions:

# Once the Useful life is over, transfer it to another asset with expected life of 1 year..

# in the AS81 field, there's a field for Depreciation charged up to today (for running year: thats 2 months of depreciation expense accumulated you will mention)..

# in that case, the system will automatically adjust the calculation for the next 1 year..

AmitavaSaha
Explorer
0 Kudos

@Walagrof,

Thanks for your quick help and suggestion.

1st solution

Its a workaround which we can do if there is no other way to achieve the solution. Business doesn't want to transfer the value to other asset.

2nd solution

AS81 is for Legacy asset transfer, which we can't use in this case.

We are trying to achieve this with Depreciation Key, ig this can be achieved with any specific Base method in Multi level method.