Depreciation changes

[Former Member]

Hi all,

In the asset management for some assets we are having 20% depreciation since last 10 years (straigh line method) for this year company decided to reduce the depreciation for those assets from the year 2000.

If i change the depreciation rate from 20 to 10, then what impact on the asset and how we calculate the new depreciation from the year 2000?

kindly give me the solution.

Raghav

[Former Member]

Hi,

The base method taken 011, i checked the customization. but the system calculating still 10%.???

Raghav

[Former Member]

I am also facing this problem.. thats what i replied as question to this thread.

excuse me raghav

[Former Member]

Hi vijay,

The scenario is according to our company rules some assets are under 6.66% depreciation for a life time of 10 Years.(This is also extendable based on the asset condition in the last year) But the assets are getting calculated by 10% for 10 Years. for the excess depreciation here users reversing with a clearing account.

every year this reverse entries are posting for asset adjustment.

to avoid this what steps i need to do?

[Former Member]

If system is calculating depreciation at 10% instead 6.66% you need to check the dep. key configuration. Check whether the Base method is given to derive the rate from life i.e Base Methods from 0005 - 0011, otherwise system will not behave like that.

[Former Member]

If the Depreciation Terms are changed and if you repeat the depreciation run the adjustment entries will get posted in the current period.

But is this is a real business scenario? If yes, will your company restate the Profits or Losses declared for all these years?

[Former Member]

Hi

I have given the dep.rate for example. actual dep.rate here maintained is low as i mentioned. the asset now is not came to the end.

my question is what impact in the asset if the depreciation will change from big percentage to small percentage?

any repeat runs or depreciation runs need to run from previous years?

[Former Member]

I am surprised you are using straight line and rate is 20% then how come you are using this asset since 10 years......This asset suppose to have usefulf life 5 years..!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!1