Change Object Value

There are three object operations in Fixed Assets that can be used to change the values for an object of the status Active.

Add Investment

Investments on single assets can be added after a fixed assets object is activated. This situation can occur because of two reasons:

• All invoices and / or credit invoices have not been received before the asset is activated.
• A true addition is made to the asset.

In order to add investment to an object, the status of that object must be Active, and no object transactions with transaction dates later than the event date for the added investment should exist for the object.

There are two types of additional investment transactions that could be initiated in the application as follows:

• Additional investment transactions initiated within IFS\Fixed Assets - These type of additional investment transactions are created with the object transaction type Add Investment. The voucher (Function group A) related to the additional investment is created when transactions are created related to this object transaction. The added investment amount will be posted using FAP0 Posting Without Posting Control, Fixed Assets. If the added investment amount is positive, it will be counter-posted using FAP14 Increase of Add Investment, Counter Posting, Acquisition Value. If the added investment amount is negative, it will be counter-posted using FAP29 Decrease of Add Investment, Counter Posting, Acquisition Value.
• Additional investment transactions initiated outside IFS\Fixed Assets - E.g., These transactions could be initiated from Manual Supplier Invoice, Manual Voucher, etc. These types of additional investment transactions are created with the object transaction type Ext Add Investment.

Change Acquisition Value

Appreciation is a change in the acquisition value (more correctly a change in the base for calculation of depreciation) which is not initiated by any additional investment. The reason for an appreciation is more likely a drastic change in the value of the asset. Inflation or any other revaluation of the asset could impose this.

In order to change the acquisition value of an object, the status of that object must be Active, and no object transactions with transaction dates later than the event date for the added investment should exist for the object. If the object is connected to any books, it must be fully depreciated up to the event date for all the books before this operation can be carried out. (The event date is the date on which the change in the acquisition value should take effect.)

Once you carry out this operation, a voucher is created in the hold table. The change in the acquisition amount will be posted using FAP0 Posting Without Posting Control, Fixed Assets. If the change in the acquisition value is positive, (an increase in the acquisition value), it will be counter-posted using FAP13 Increase of Acquisition value, Counter Posting, Acquisition Value. If the change in the acquisition value is negative (a decrease in the acquisition value), it will be counter-posted using FAP28 Decrease of Acquisition Value, Counter Posting, Acquisition Value.

Change Net Value

Change Net Value is a way to manually change the net value for an asset, other than using the depreciation process. The reason can be one of the following:

• Decrease of the net value of an asset / group of assets which has / have a too high value.
• Increase of the net value of an asset / group of assets which has / have been depreciated too much and Roll Back is not an acceptable option. Typically used in the situation where the user wishes to keep the original plan and just wants to do an exception in a particular year.
• Decrease or increase of net value is necessary in order to have an "acceptable" net profit of the year. Of course our users would do this within the limits of any law and regulation.

In order to change the net value of an object, the status of the object must be Active. It is also required that the object is connected to at least one book. The object must also be depreciated up to the event date for each book that it is connected to. At the same time, no object transactions with transaction dates later than the event date should exist for the object for which the change net value operation is to be carried out. (The event date is the date on which the change in the net value should  take effect.)

When this operation is carried out, the change in the accumulated depreciation is posted using FAP16 Change Net Value, Balance Accounting. If the change in the net value is positive (an increase in the net value), the decrease in depreciation will be posted using FAP30. If the change in the net value is negative (a decrease in the net value), the increase in depreciation will be posted using FAP15 Decrease of Net Value, Cost Accounting.

Affects on Depreciations

Note that this functionality will influence depreciation as well.

Change Acquisition Value (and Add Investment)

A change in acquisition value affects the basis for depreciation calculation for the coming depreciations. The change will have different effects for different methods used.

Straight Line

For a straight line method a change in acquisition value will give a new depreciation amount; new basis but the same factor. In the case of an increase in acquisition value, some of the added amount will not be depreciated up to the last period, and will be added as a lump sum. A decrease in acquisition value will end up with a shorter recovering period since the net value will be zero before the method length is reached. Converting to remaining value over remaining life is generally the best way to distribute a change of object value evenly over the rest of an objects life.

Declining

For a declining method it will result in a new depreciation amount, new basis but same factor. Converting to remaining value over remaining life is generally the best way to distribute a change of object value evenly over the rest of an objects life.

Customized

For a customized method a change in acquisition value will give a new depreciation amount; new basis but same factor. In the case of an increase in acquisition value, some of the added amount will not be depreciated up to the last period, and will be added as a lump sum. A decrease in acquisition value will end up with a shorter recovering period since the net value will be zero before the method length is reached. Converting to remaining value over remaining life is generally the best way to distribute a change of object value evenly over the rest of an objects life.

Remaining Value over Remaining Life

The remaining value over remaining life method depreciates the objects remaining depreciable basis evenly over the objects remaining estimated life.

Change Net Value

A change in net value creates an additional depreciation for the chosen period and can be compared to a manual depreciation. The change will have different effects for different methods used.

Straight Line

For a straight line method a change in net value will not result in a new depreciation amount. In the case of an increase in net value, some of the added amount will not be depreciated up to the last period, and will be added as a lump sum. A decrease in net value will end up with a shorter recovering period since the net value will be zero before the method length is reached. Converting to remaining value over remaining life is generally the best way to distribute a change of object value evenly over the rest of an objects life.

Declining

The calculation of depreciation will be affected at the next point of time for base value calculation, accounting year or object year. At that time a new net value will be calculated, resulting in a larger or smaller depreciation amount, depending on whether  the change was an increase or a decrease in net value. Converting to remaining value over remaining life is generally the best way to distribute a change of object value evenly over the rest of an objects life.

Customized

For a Customized method a change in net value will not result in a new depreciation amount. In the case of an increase in net value, some of the added amount will not be depreciated up to the last period, and will be added as a lump sum. A decrease in net value will end up with a shorter recovering period since the net value will be zero before the method length is reached. Converting to remaining value over remaining life is generally the best way to distribute a change of object value evenly over the rest of an objects life.

Remaining Value over Remaining Life

The calculation of depreciation will be affected at the next point of time for base value calculation, accounting year or object year. At that time a new net value will be calculated resulting in a larger or smaller depreciation amount depending on whether the change was an increase or a decrease in net value. The remaining value over remaining life method distributes the objects remaining depreciable basis and depreciates that amount evenly over the objects remaining estimated life.