12/26/2016 Varun'sTechnologyBlog:AX2012FixedAssetSetUp

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F r i d a y, 3 A u g u s t 2 0 1 2

AX 2012 Fixed Asset Set Up

1.SetUpJournalNamesinGeneralLedger

Torecordfixedassettransactionsusingjournals,youmustcreateatleastonejournalnameusingthejournal
typePostfixedassetsinthesetupoftheGeneralledgermodule.Ifbudgetsforfixedassetsarerequired,you
mustalsocreateajournalnamethatusesthejournaltypeFixedassetbudget.

2.JournalNamesinInventoryManagement

SettingupjournalnamesintheInventorymanagementmoduleisnecessaryiffixedassetsareassembledby
usinginventoryitems.

3.MainAccounts

FullintegrationofFixedassetswiththeGeneralledgerrequiresthefollowing:

SetupofaccountsintheChartofAccountsspecificallyforusewithFixedassets
AssigningtheseaccountsintheFixedassetpostingprofilesforFixedassettransactiontypes

Typically,accountsaresetupsothatthefollowingcanbecaptured.

Acquisitionvaluesbothcurrentandprioryears
Accumulateddepreciationbothcurrentandprioryears
Valueadjustments
Disposalofassets

4.DepreciationProfiles

Depreciationprofilesareusedtodefinerulesforcalculatingdepreciation.
Creatingprofilesisrequiredfordepreciableassets.Thisusuallyreferstotangible
assets,butintangibleassetscanalsousedepreciationprofiles.
Financialassetssuchassharesofstocksorbondsareconsiderednondepreciable.
Therefore,depreciationprofilesarenotrequiredfortheseassets.
Thefollowingmethodsareavailablefordepreciationcalculation:

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Percentage:InthePercentagefield,enterthepercentagetousefordepreciation.Thepercentageis
multipliedbythenetbookvaluetocalculatethedepreciationfortheperiod.Thisfieldisnotusedforall
methods.(ReducingBalalnce)

Depreciationyear:IntheDepreciationyearfield,selectCalendarorFiscal.

Calendar:UpdatesthebasisfordepreciationcalculationeveryyearonthefirstofJanuary.
Fiscal:Updatesdepreciationbasedonthefiscalyearsetup.
Thefiscalyearcanbelongerorshorterthantwelvemonths.
Whenfiscalperiodsareofdifferentlengths,MicrosoftDynamicsAX2012adjuststhe
depreciationamountforeachfiscalyear.
Periodfrequency:Periodfrequencydefinestheaccrualoftheyearlydepreciationamount.InthePeriod
frequencyfield,selectfromthefollowingoptions.
Yearly:Theyearlydepreciationispostedonlyonetime.Onthe31stofDecemberwhenCalendarisselected
fortheDepreciationyearoronthelastdayofthefiscalyearwhenFiscalisselectedfortheDepreciation
year.

Monthly:Themonthlydepreciationispostedasonetwelfthoftheyearlyamounteachmonth.
Quarterly:Thedepreciationispostedasonequarteroftheyearlyamounteachquarter.
Halfyearly:Thedepreciationispostedasonehalfoftheyearlyamounteachhalfyear.
Fiscalperiod:Thetotalamountofdepreciationforthefiscal
yearissplitintothedefinedfiscalperiods.

FullDepreciationmeansthattheassetwillbefullydepreciatedwhentheservicelifeequalszero.

5.DepreciationBooks

Youcanusedepreciationbookstotrackdepreciationfortaxorothernonfinancialpurposeswithoutaffecting
theGeneralledger.MultipleDepreciationbookscanbesetupandusedtotrack,forexample:
Federaltax

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Statetax
AlternativeMinimumTax(AMT)
Acompanycanusethisfeaturetosetupandrunonedepreciationmethodforbookpurposesandoneormore
additionaldepreciationmethod(s)fortaxpurposes.

Alternativedepreciationprofilefield,selectadepreciationprofile,ifitisnecessary.Thealternative
depreciationprofileisusedwhentwodepreciationmethodsarecombined(throughstatutory
regulations)andacompanycanpostthehighestdepreciation.

LeaveBookValueAt:Entertheamountbywhichtoreducethelastdepreciation.Thiskeepsthenetbook
valueattheamountyouenteruntildisposal.Thevaluethatyouenteristheresidualbookvalueforthe
depreciatedfixedassets.Inthecaseofadisposalduetoasale,theremaindervalueissetto0.00.

SelecttheCreatedepreciationadjustmentswithbasisadjustmentscheckboxtoautomaticallygenerate
depreciationadjustmentswhenthebasisoftheassetisadjustedwithanotheradjustmenttypeentry.

5.ValueModels

ValueModelsaresimilartoDepreciationBooks,andarerequiredforeveryFAthatisacquired.Theyfromtheamodelforhow
theFAwillbeforvaluedinthefuture.

6.FixedAssetGroups

FAGroupsformthecentrepieceofthesetupastheylinkthedepreciationbookandvaluemodelwithaFAGroup.

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10 comments:

Anonymous 19 March 2013 at 11:53

How many value models would you set up per fixed asset? My understanding is that if the
depreciable basis (cost) or depreciable life for tax or AMT purposes differs from corporate book
purposes, then you need to set up one (or maybe two) additional value models for each fixed
asset. Do you agree?

Reply

Replies

Varun Shah 19 March 2013 at 19:21

Hi,

You are on the right track. We can make one value model and post depreciation to the
current layer and the tax to the tax layer.

The other option is to make one value model and one depreciation book. Micorosft has
made depreciation books for the purpose of reporting only.

For example in india depreciation is done by two separate acts. The Companies act and
the Income Tax Act. The income tax act is used in conjunction with the deprecation
boon as it is only calculated for reporting it does not impact our books. Where as
normal deprecation which will impact our books is calculated through value models.

Pleas feel free to ask more questions if this is not clear. :)

Reply

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John C 27 June 2013 at 08:29

Varun,

Do you know if the Automatically create depreciation adjustment amounts with disposal parameter
is working properly in 2012 r2?

Reply

Varun Shah 4 July 2013 at 02:28

Hi John, yes this feature will work properly provided your setups are correct.

Reply

Anonymous 4 October 2013 at 05:12

Hello Varun,
I do not understand the transactions Dynamics AX generates when activating the Parameter
"automatically create depreciation adjustment amounts with disposal". What would be a scenario
when this parameter should be activated?
Hope you can help.
Thanks,
Ludwig

Reply

Anonymous 20 November 2013 at 08:32

hi varun

want to know what should be the calendar type for value model as per co act and it act.

Reply

Varun Shah 20 November 2013 at 09:07

I would suggest you track the the companies act depreciation via value model and the IT act
depreciation with depreciation books.

The calendar type for CO act should be day based.

The calendar type for IT act should be fiscal.

Reply

Anonymous 4 February 2016 at 01:49

Hi Varun,
Am using AX2012 R3,and am getting the following message when 'You must set up periods for the
fixed asset calendar Calendar'. In fact the asset service life is 80 periods=6.67 years , that is not an
integer. For all other types whose lifetime year is an integer, there is no issue. Is there any issue
with service life year not being an integer? Please guide. Thanks

Reply

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Anonymous 8 March 2016 at 01:27

Hi any reply on the above? I am getting the same error using AX2012

Reply

Replies

Anonymous 14 June 2016 at 18:52

Yes this is definitely a bug...if the life has decimals AX is expecting that number of
years to exist in the calendar. So if you acquire something in 2016 with a life of 100.5
years AX wants the calendar to go up to 2117...if you change the life to 100 years it
does not care what is in the calendar

Reply

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