COMPUTE DEPRECIATION

Use this screen to initiate the depreciation calculation process for one, a range of, or all asset records. You can calculate depreciation for asset records assigned to a range of asset accounts, organizations, and/or projects.

For each eligible, depreciable Asset Master record for which the Auto Calculate Depreciation checkbox has been selected in the G/L Book Info subtasks of the Maintain Asset Master Info screen (or in the corresponding field in the Maintain Asset G/L Book Info screen), the system computes and writes a value into the Current Pd Depreciation or Current Pd Amortization field, as appropriate. The current period depreciation value is computed only if depreciation is based on years or units. If depreciation is based on lease periods, the value is copied from the Monthly Payment field to the Current Pd Amortization field (G/L Book Info (Leases) subtask of the Maintain Asset Master Info screen).

Note: The calculation of depreciation has no effect on the posting of depreciation. Once the Current Pd Depreciation field has been populated with a value other than zero, it must be posted or zeroed out before the current accounting period can be closed in Costpoint Fixed Assets.

The following requirements must be met for an Asset Master record before depreciation calculations can proceed for that record:

The Asset Master record asset/item number must be within the asset/item number parameter(s) selected in the Compute Depreciation screen.
The asset account/organization/project combination assigned to the Asset Master record must be within the acct/org/proj parameter(s) selected in the Compute Depreciation screen.
The Asset Master record must be active (Record Status must be Active in Maintain Asset Master Info screen).
The Asset Master record must be depreciable (Depr Status must be Depreciable in Maintain Asset Master Info screen).

Note: For a depreciable record in which depreciation is based on Years, you must assign a valid depreciation method before you can save the Asset Master record. Enter depreciation methods in the Depr Method Code field in the G/L Book Info (Years) subtask and the Other Books Info subtask of the Maintain Asset Master Info screen, as applicable.

The auto-calculation function for the Asset Master record must be enabled [the Auto Calculate Depreciation checkbox is selected in the G/L Book Info (Years or Units) subtask or the Auto Calculate checkbox is selected in the G/L Book Info (Leases) and in the corresponding fields in the Other Books Info subtasks of the Maintain Asset Master Info screen, as applicable].
The Asset Master record must have a start date that is on or before the last day of the Fixed Assets current fiscal year and accounting period. (The current FA fiscal year, period, and subperiod display in the Posting Settings screen.) You can enter the start date in the following fields and subtasks of the Maintain Asset Master Info screen:
Depr Start Date field in the G/L Book Info (Years) subtask
Depr Start Date field in the G/L Book Info (Units) subtask
Amortization Start Date field in the G/L Book Info (Leases) subtask
Depr Start Date field in the Other Books Info subtask

The Asset Master record timing status must be valid:
The current depreciation year (Curr Depr Yr field in the G/L Book Info (Years) subtask) must not be greater than the total years of useful life specified in the Years of Useful Life field from the Depr Methods - Basic Setup screen (NOT from the Useful Life field from the G/L Book Info (Years) subtask or the Other Books Info subtask, as applicable).
The remaining time periods must be greater than zero (Days/Pds Remaining field from the G/L Book Info (Years) subtask or the Other Books Info subtask, as applicable). If depreciation is based on leases, the Lease Payments Remaining field from the G/L Book Info (Leases) subtask must be greater than zero.

Note: To prevent the over-depreciation of an asset, if the current period depreciation amount computed by the system is greater than the book value of the asset, the system will reduce the current period amount by the excess (if the Auto Calculate Depreciation or Auto Calculate checkbox is selected) on a one-time basis in the current period.

The period for which you are computing depreciation must be set up as the current period in the Posting Settings screen, and the fiscal year and period must exist in the Maintain FA Fiscal Years and the Maintain FA Accounting Periods screens. In addition, at least the next fiscal year and its corresponding periods must be set up in the Maintain FA Fiscal Years and the Maintain FA Accounting Periods screens.

If you are computing projected depreciation for future fiscal years, each future fiscal year and its corresponding periods must also be set up in the Maintain FA Fiscal Years and the Maintain FA Accounting Periods screens.

Five general factors can affect the computation of depreciation based on years:

System-Wide Configuration for Depreciation Calculations

Depreciation calculations can be configured on a system-wide basis in the Fixed Assets Settings screen. You can select one of two methods for computing "Catch-Up" amounts for prior periods missed in a current depreciation year (Purchase Year or Fiscal Year). The options include spreading the "Catch-Up" amount among the remaining periods in the PY (purchase year) or FY (fiscal year), or adding the "Catch-Up" amount to the amount computed for the current period.

Note: Although you can change the configuration after you have initialized the system, your company should make this decision as part of the initialization procedures.

Use of Date of Purchase or Fiscal Year Depreciation Basis with Depreciation Method

The Date of Purchase or Fiscal Year depreciation basis that you specify for each depreciation method determines the specific formula that will be used to compute depreciation. Note that different formulas may be used within the same asset record because depreciation methods are assigned on a book-by-book basis for each asset record.

Note: It is important that you decide on either the Date of Purchase or Fiscal Year depreciation basis for the depreciation methods that you assign to your Asset Master records BEFORE you compute depreciation for the first time. If you assign a different depreciation method that has a different basis to a record AFTER depreciation has begun, you will need to make extensive manual edits to fields in the Asset Master record before computations will proceed correctly.

When you assign a Date of Purchase depreciation basis method to any book in an Asset Master record, the depreciation year begins on the date (or month) of purchase and continues for one year from the purchase. This timeframe usually crosses fiscal years (except for assets purchased in the first month of the fiscal year).
When you assign a Fiscal Year depreciation basis method to any book in an Asset Master record, the system allocates the full year's depreciation percentage within the current fiscal year, regardless of the period of acquisition within the fiscal year. (The annual depreciation computation will be the same, whether the asset is acquired in the first, second, third, and so on, period of the fiscal year.)

Special System-Wide Configuration for Date of Purchase Depreciation Basis Methods.

When you establish each depreciation method in the Depr Methods - Basic Setup screen, you must specify whether the method uses the Date of Purchase or Fiscal Year depreciation basis. If you have specified a Date of Purchase depreciation method basis for use in any book in an Asset Master record, you must ALSO specify the configuration to use during calculations. The System-Wide Configuration for Date of Purchase depreciation basis calculations is established in the Fixed Asset Settings screen.

If you have assigned a Date of Purchase basis to one or more depreciation methods in the Depr Methods - Basic Setup screen AND if you have also selected the "Catch-Up" calculation option (Added to current period amount radio button) in the Fixed Assets Settings screen that adds missed depreciation for prior periods in the current year to the current period depreciation amount, the system will display the following soft warning information message:

Warning: You have assigned a Date of Purchase basis to one or more depreciation methods in the Depr Methods - Basic Setup screen. You have also selected the "Catch-Up" calculation option in the Fixed Assets Settings screen that adds missed depreciation for prior periods in the current year to the current period depreciation amount.

In order to ensure the proper calculation of depreciation under these conditions, make sure that you have first set up historical fiscal year and period data in the Maintain FA Fiscal Years and Maintain FA Accounting Periods screens. Please refer to the documentation for these screens for additional information.

You should set up this data on a one-time basis for each year specified in the depreciation start date assigned to your Asset Master records (for which there is remaining book value). (Make sure that you insert the earlier fiscal years into the Maintain FA Fiscal Years screen instead of using the New Line function.)

Alternately, if you do not want to add historical fiscal year and period data in the Maintain FA Fiscal Years and Maintain FA Accounting Periods screens, you can change the "Catch-Up" calculation option in the Fixed Assets Settings screen to spread missed depreciation for prior periods among the remaining periods in the current year.

You can choose to spread annual depreciation evenly throughout the purchase year OR to compute current period depreciation based on the actual number of days in the current period.

Warning: You should decide on the configuration for use at your company before initialization. If you change the configuration after depreciation has been computed, subsequent depreciation calculations will be incorrect. To ensure that future calculations are correct when you change the configuration, you must manually edit the Days/Pds Remaining field for each Asset Master record.

You can compute current period depreciation based on the following:

Number of Periods in a Purchase Year

If you select this option, the system will spread annual depreciation evenly throughout the purchase year. Unless you have made changes to key fields used in the computation, this option will compute consistent current period depreciation values from period-to-period across the purchase year among periods that contain inconsistent numbers of days. Most users select this option.

The Actual Number of Days "Owned" in Each Period

If you select this option, the system will compute current period depreciation based on the actual number of days in the current period. This option will compute varying current period depreciation values from period-to-period across the purchase year, depending on the number of days in the current period. (For this configuration, the system uses a standard value of 365 days in a year (366 for a leap year) for calculations.) Few users select this option because there are more complex initialization and maintenance issues.

Data Entered for Depreciation Method

Data entered for the depreciation method assigned to any book of an Asset Master record can also influence the calculation of depreciation. These factors can include the following types of data from the Depr Methods - Basic Setup screen:

Years of Useful Life
Total % to Depreciate
% Depreciation Per Year
Basis - Date of Purchase or Fiscal Year (discussed in previous paragraphs)
Subtract Salvage Value Before Calculation checkbox

Data Entered in Asset Master Record

Data entered in an Asset Master record can also influence the calculation of depreciation. These factors can include the following types of data, as applicable:

From Maintain Asset Master Info screen:

Depreciation Based on Years, Units of Usage, or Lease Pds radio button

From Cost Info and Other Books Info subtasks:

Total Cost

From G/L Book Info (Years, Units, Leases) and Other Books Info subtasks:
Auto Calculate Depreciation (Y/N)
Depr Method Code
Depr Start Date
Curr Depr Yr
Days/Pds Remaining
Amt Taken Purchase YTD (for Date of Purchase Basis only)
Salvage Percent
Salvage Value
FYTD Depreciation
Prior FY Depreciation
Estimated Units Useful Life
Std Depr Rate Per Unit of Usage
Prior Units Used
Current Units Used
Total Lease Value
Monthly Payment
Lease Payments Remaining
Amortization Start Date
FYTD Amortization
Prior FY Amortization

A technical discussion along with specific examples of how the system calculates depreciation using different configurations and conditions can be found in Special Topic FA-3, "Calculate Depreciation."

You can calculate depreciation at any time within an accounting period. In addition, depreciation computations can be run multiple times within the same accounting period. As a general procedure, however, you should calculate depreciation after you have added all the new asset records for the period and have reconciled the appropriate accounts with the General Ledger.

The Asset Master records in Costpoint Fixed Assets serve as a subsidiary ledger to the General Ledger. As a result, you should always perform a reconciliation of Costpoint Fixed Assets account balances for the asset and accumulated depreciation accounts with your General Ledger balances. The detail from Costpoint Fixed Assets should reconcile to the summary totals in your General Ledger. You can use the Print FA/GL Reconciliation Report from the Reports menu option to assist you with this reconciliation function.

Ideally, you should perform a reconciliation at the time of initialization and each month thereafter, after you have closed the Fixed Assets current accounting period but before you have computed depreciation for the next period. Before you calculate depreciation, you should make certain that these reconciliations have been performed and any discrepancies have been remedied.

Warning: The calculation of depreciation is an optional procedure. It is possible to close a current period in Costpoint Fixed Assets without computing or posting depreciation.

Make certain that you establish control procedures at your company to ensure that depreciation calculation(s) are performed at the desired time period(s) consistent with your overall processing schedule.

A Fixed Assets monthly procedures workflow has been created for you in Costpoint Workflow. You may want to use this as a guide in establishing the Fixed Assets procedures at your company.

If a post sequence number exists for any asset, the system stops the compute depreciation process and displays an error message. Sequence numbers display in the Maintain Asset Master Info main screen only for entries that were unsuccessfully posted or if the system is in the process of posting the entry. After the entry has been successfully posted for the asset, the sequence number will no longer display in the Asset Master record. Once the sequence number disappears, you can continue with the compute depreciation process.

Warning: If the Fixed Assets period close process fails and rows exist in the Post Semaphore table, you will not be able to execute the Compute Depreciation process. In this event, you should either wait until the close process is completed successfully or restart the failed close process before re-running the calculation process.

When you execute the Compute Depreciation process, the system performs an additional validation to ensure that there is enough future data in the Maintain FA Fiscal Years and Maintain FA Accounting Periods screens to perform the calculations.

Select Asset/Item Numbers

You can calculate depreciation for a range of asset/item numbers in this group box. The selection of records from within the asset number/item number(s) that you specify may be modified by your selection of asset account, organization, and/or project range, as well as by system criteria regarding the selection of eligible records to include in the computation.

Range Option

The default option for this field is "All." You can accept the displayed default range option, enter a different valid range option, or select one from the drop-down box. Range options are "All," "One," "Range, "From Beginning," and "To End."

If you save the selection parameters for this process, the selected Range Option, as applicable, will be stored in the Query table in the Asset/Item Range column.

From

Enter the beginning asset/item number for the range or use Lookup to search for and select one from those displayed. Because this is a standard Lookup to the ASSET table, you may find that you have selected asset/item numbers for which depreciation cannot be computed or for non-depreciable assets.

If you select "All" or "From Beginning" in the Range Option field, these fields will be inactive.

If you save the selection parameters for this process, the selected From value(s), as applicable, will be stored in the Query table in the Asset No From and Item No From columns.

To

Enter the ending asset/item number for the range or use Lookup to search for and select one from those displayed. Because this is a standard Lookup to the ASSET table, you may find that you have selected asset/item numbers for which depreciation cannot be computed or for non-depreciable assets.

If you select "All," "One," or "To End" in the Range Option field, these fields will be inactive.

If you enter only an asset number, you cannot run the calculation process until you have entered a corresponding item number.

If you save the selection parameters for this process, the selected To value(s), as applicable, will be stored in the Query table in the Asset No To and Item No To columns.

Select Asset Accounts

You can calculate depreciation a range of asset accounts.

Asset "ownership" data is required entry in the Account Info for G/L Book subtask of the Maintain Asset Master Info screen (and in the Maintain Asset Account Info screen) for all property records. Account and organization are always required, but projects and reference numbers are optional. The account/org/proj/ref1/ref2 data that you assign to an asset specifies "ownership," and can include company-owned balance sheet combinations, expense combinations, project combinations, and so on.

The selection of records from within the account(s) that you specify may be modified by your selection of asset/item number, asset organization, and/or project range, as well as by system criteria regarding the selection of eligible records to include in the computation.

Note: Only asset acct/org/project combinations that have been previously validated and assigned to Asset Master records will be selected from within the parameters that you specify.

Range Option

If you save the selection parameters for this process, the selected Range Option, as applicable, will be stored in the Query table in the Asset Account Range column.

From

Enter the beginning asset account or use Lookup to search for and select one from among the asset accounts already associated with your property records. Because this is a standard Lookup to the ACCT table, you may find that you have selected accounts for which asset data does not exist.

If you select "All" or "From Beginning" in the Range Option field, this field will be inactive.

If you save the selection parameters for this process, the selected From value, as applicable, will be stored in the Query table in the Asset Account From column.

To

Enter the ending asset account or use Lookup to search for and select one from among the asset accounts already associated with your property records. Because this is a standard Lookup to the ACCT table, you may find that you have selected accounts for which asset data does not exist.

If you select "All," "One," or "To End" in the Range Option field, this field will be inactive.

If you save the selection parameters for this process, the selected To value, as applicable, will be stored in the Query table in the Asset Account To column.

Select Organizations

Asset "ownership" data is required entry in the Account Info for G/L Book subtask of the Maintain Asset Master Info screen and in the Maintain Asset Account Info screen for all property records. Account and organization are always required, but projects and reference numbers are optional. The account/org/proj/ref1/ref2 data that you assign to an asset specifies "ownership" and can include company-owned balance sheet or expense accounts, projects, and so on.

You can calculate depreciation for a range of organizations. The selection of records from within the organizations(s) that you specify may be modified by your selection of asset/item number, asset account, and/or project range, as well as by system criteria regarding the selection of eligible records to include in the computation.

Note: Only asset acct/org/project combinations that have been previously validated and assigned to Asset Master records will be selected from within the parameters that you specify.

Range Option

If you save the selection parameters for this process, the selected Range Option, as applicable, will be stored in the Query table in the Organization Range column.

From

Enter the beginning organization or use Lookup to search for and select one from those displayed. Because this is a standard Lookup to the ORG_ACCT table, you may find that you have selected organizations for which asset data does not exist.

If you select "All" or "From Beginning" in the Range Option field, this field will be inactive.

If you save the selection parameters for this process, the selected From value, as applicable, will be stored in the Query table in the Organization From column.

To

Enter the ending organization or use Lookup to search for and select one from those displayed. Because this is a standard Lookup to the ORG_ACCT table, you may find that you have selected organizations for which asset data does not exist.

If you select "All," "One," or "To End" in the Range Option field, this field will be inactive.

If you save the selection parameters for this process, the selected To value, as applicable, will be stored in the Query table in the Organization To column.

Select Projects

You can calculate depreciation for a range of projects. The selection of records from within the project(s) that you specify may be modified by your selection of asset/item number, asset account, and/or organization range, as well as by system criteria regarding the selection of eligible records to include in the computation.

Note: Only asset acct/org/project combinations that have been previously validated and assigned to Asset Master records will be selected from within the parameters that you specify.

Range Option

If you save the selection parameters for this process, the selected Range Option, as applicable, will be stored in the Query table in the Project Range column.

From

Enter the beginning project or use Lookup to search for and select one from those displayed. Because this is a standard Lookup to the PROJ table, you may find that you have selected projects for which asset data does not exist.

If you select "All" or "From Beginning" in the Range Option field, this field will be inactive.

If you save the selection parameters for this process, the selected From value, as applicable, will be stored in the Query table in the Project From column.

To

Enter the ending organization or use Lookup to search for and select one from those displayed. Because this is a standard Lookup to the PROJ table, you may find that you have selected projects for which asset data does not exist.

If you select "All," "One," or "To End" in the Range Option field, this field will be inactive.

If you save the selection parameters for this process, the selected To value, as applicable, will be stored in the Query table in the Project From column.

Computation Option

You may have Asset Master records in which there is no remaining useful life, yet small residual book value amounts still exist. In the past, the only remedy for this problem was to manually enter the residual amount of book value into the current depreciation field for each affected record and post depreciation again.

The computation option in this screen provides a simple solution to the problem of residual book value existing for assets that have no remaining useful life. If you select the checkbox in this group box, the system will populate the current period depreciation amounts with the remaining book value for assets in which there is no remaining useful life, in all applicable books.

For the G/L book, the residual amount of current period depreciation expense computed by the system can be subsequently posted to fully depreciate these assets and reduce their book value to "0." For your optional other books, although the residual amount of current period depreciation is never posted to the G/L, it will be considered as part of the depreciation expense during the close and will reduce the book value to "0" as well.

You can include or exclude assets in which the auto calculation option has been set to "Y" or "N."

Populate Current Pd Depr Amt with Rem Bk Value

Select this checkbox if you want the system to populate the current depreciation amount with the remaining book value for assets that have no remaining useful life.

The system determines that an asset has no remaining useful life when the values in both the Curr Depr Yr and Days/Pds Remaining fields are "0."

This checkbox is unchecked by default.

If you select this checkbox, you must also select at least one checkbox in the Include Assets in Which group box, in which are checkboxes all unchecked by default.

If you select this checkbox and save the print parameters for this report, your selection, as applicable, will be stored as "Y" in the Query table in the Populate Curr Pd Depr Amt with Rem Bk Value column.

Include Assets in Which

Use the checkboxes in this group box to select the auto calculation status of the records in which the system will populate the current depreciation amount with the remaining book value.

The default status of each checkbox is unchecked, and you must select at least one checkbox.

Auto Calc = "Y"

Select this checkbox if you want the system to populate the current depreciation amount with the remaining book value for assets in which the Auto Calc flag = "Y."

This checkbox is unchecked by default.

If you save the selection parameters for this process, the selected checkbox, as applicable, will be stored as "Y" in the Query table in the Include Assets In Which Auto Calc = Y column.

Auto Calc = "N"

Select this checkbox if you want the system to populate the current depreciation amount with the remaining book value for assets in which the Auto Calc flag = "Y."

This checkbox is unchecked by default.

If you save the selection parameters for this process, the selected checkbox, as applicable, will be stored as "Y" in the Query table in the Include Assets In Which Auto Calc = N column.

Fiscal Year and Accounting Period

The fields in this group box display the fiscal year, period, and subperiod for which depreciation will be computed.

Fiscal Year

The current fiscal year from the Posting Settings screen displays in this non-editable field. Because only one period at a time is open in Costpoint Fixed Assets, you cannot compute depreciation for a period in any other fiscal year.

Period

The current accounting period from the Posting Settings screen displays in this non-editable field. Because only one period at a time is open in Costpoint Fixed Assets, you cannot compute depreciation for any other period.

Subperiod

The subperiod from the Posting Settings screen displays in this non-editable field, although it is actually not used in depreciation calculations. Regardless of the subperiod that displays in this field, the system computes depreciation only for the current accounting period in total. The subperiod from the Posting Settings screen is used by the system only to determine which subperiod the system should use to post the FA Journal to the General Ledger.

Note: The Subperiod field is the only editable field in the Posting Settings screen once you have completed the first Fixed Assets posting. It is used only during posting routines in Costpoint Fixed Assets and is ignored during depreciation calculations. Although you can change the subperiod in that screen, you cannot enter a subperiod assigned "Not Available" status. (Subperiod status is assigned in the Subperiods screen in Costpoint General Ledger.) In addition, you must assign the Fixed Assets Journal an "Open" status for the subperiod in the Subperiods screen before you can compute depreciation for this fiscal year/period/subperiod combination.

Print/Process

Select this button on the toolbar to initiate the depreciation calculation process.

The system computes all eligible records and does not stop the process if there are errors. The system automatically creates and prints an error report when the compute process is complete. (You cannot view this report using Preview.)

"No errors found" will display on the report if no errors are encountered during the computation.

If the system cannot compute depreciation because of specific circumstances, the error report will display the error message along with the asset/item(s) to which it applies, as follows:

"Unable to count number of fiscal years from depr start date to current period."

The system generates this message if there is a database error. Check with your database administrator to resolve this type of error.

"There is no fiscal year setup which contains this depreciation start date."

The system generates this message when there is insufficient data to perform the calculation. You can add the missing fiscal year data or edit the depreciation start date, as appropriate.

"A problem exists with depr yr no and fiscal year setup being referenced."

The system generates this message when fiscal year sequence numbers are missing or skipped in the numerical order. Contact Deltek Technical Support for assistance on how to correct this condition.

Once you have corrected the error condition, you can compute depreciation again for the error records, as desired.

Hint: You can save selection criteria for this process with or without processing. After making your selections, select the Save button on the toolbar or go to Save in the File menu. Enter an alphanumeric identifying code and a short description to help you recognize the process parameters and select OK. Later, you can run Find or Query from this screen to access the process parameters you created, and run the same report without having to enter all the selection screen information again.

Stored process parameters are especially useful if reports are to be run through Process Manager. If you want to keep these parameters but want to run the process using different selection parameters, you can use Clone to copy the parameters and make minor changes to them without changing your saved parameters. To use Clone, go to the File menu or press [F4]. The Clone window will display on the screen. Enter the parameters ID you want to clone, or select the Execute pushbutton to display and select from a list of parameter IDs. When you click on the Select pushbutton, the system makes a copy of the parameters, which you can edit as needed.

Table Information

When you run the process from this screen, the system populates the current period depreciation field in the ASSET (Asset) and the ASSET_OTH_BK_DEPR (Asset Other Books) tables, as applicable.

Lookups access data from the ASSET (Asset), ACCT (Account), ORG_ACCT (Organization/Account), and PROJ (Project) tables.