Changing Critical Depreciation Fields
Before changing a critical depreciation field, we recommend that you print the Main tab of the asset you are changing to insure you have the original asset information or perform a backup of the company prior to making the change, in case you do not get the desired outcome.
The system uses the information entered in several fields to calculate depreciation. The following fields are the depreciation-critical fields:
- Property Type
- Placed-in-Service Date
- Acquisition Value
- Depreciation Method
- Estimated Life
- Salvage Value
- Section 168 Allowance % (if applicable to method)
- Section 179
- Business-Use Percentage
When you change a value in a depreciation-critical field after you have calculated depreciation for the asset, you must tell the system when to apply the change. The system could apply the new information at several different points in the life of the asset. A message box will prompt you to select the date after you make the change to the depreciation-critical field.
To change a critical depreciation field
- Go to Asset Detail for the asset whose depreciation-critical information you want to change.
- Change the information in one of the depreciation-critical fields. When you tab out of the field, a message warns you that you are making a change to a depreciation-critical field and asks if you want to continue.
- Select the Yes button to continue. The Critical Depreciation Change window appears.
- Select one of the four option buttons on the Critical Depreciation Change window, and then select OK. The information in the Beginning Depreciation, Current Depreciation, and Period Close fields is updated.
- Select the Save Asset button.
The Bulk Edit feature allows the critical depreciation fields of depreciation method and/or estimated life to be changed for one or more assets by selecting the appropriate group. To change a single asset, choose Depreciation > Bulk Edit from the top menu while in Asset Detail for the asset you wish to change. See Performing a Bulk Edit for more information.
Note: If you select anything except Placed-in-Service Date in step 4, the depreciation method is currently SL, SF, or SH, and the changes make the asset under-depreciated as related to the new values, the asset may not fully depreciate over the life of the asset. In this case, we recommend changing the Depreciation Method to RH, RM, or RV. The Depreciation Adjustment report can assist you in identifying under-depreciated assets.
Note: If assets with a 168 Allowance or a 179 Deduction amount are changed to depreciation method RH, RM, or RV and the effective change date is other than the Placed-in-Service Date, manually adjust each asset after the method changes as follows:
- 179 Deduction: re-enter the original amount in the 179 Deduction field.
- 168 Allowance: increase the Beginning Accum field amount by adding the original 168 Allowance Amount. See RH & RM Methods Overview for more details.