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Oracle Financials for India User Guide
Release 12.1
Part Number E13658-03
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India Local Fixed Assets

This chapter covers the following topics:

Fixed Asset Depreciation Calculation

Businesses in India, under the Income Tax Act, have to compute depreciation using the “Written Down Value” method. The depreciation percentage has to be applied on the Block of Assets and no depreciation can be claimed on individual assets.

Using India Localization, you can:

Note: It may be noted that localization provides only the reports showing the workings of depreciation based on block of assets. No accounting entries will be passed on the figures derived through localization will not be considered for any accounting entries automatically.

The Tax Handling functionality provides you with the information requirements under Income Tax Act. You can:

Major Features

Definition of Block of Assets: User will be able to define block of assets by having the asset categories defined with highest level of details as required for Income Tax.

Opening Balance of Block of Assets: User is provided with a facility to enter Opening balances for block of assets (one time facility). User is provided with a report, which will facilitate arriving at asset category wise, Gross Block of Assets and written Down Value as required for Income Tax purpose.

Periodical Closing Balances of Block of Assets: User is provided with a facility generate monthly closing balances of Block of assets.

Transactions

Various Transactions India Localization Supports in Fixed Assets are mentioned in this section.

Asset Additions

While recording the additions of assets in Oracle assets, the user need to allocate the individual asset to the Block of assets defined. The block details of the assets need to be assigned by recording the details in the flex field. You need to enter localization details in Asset Categories flexfield while additions through Quick Additions and New Additions. While you would be entering these details in Mass Additions Flex field while adding assets through Prepare Mass Additions. On recording the complete asset related information including asset book and cost of the asset, user need to click on the flexfield and select the context value as India B Assets.

Before you enter the Asset Additions, you must:

Navigate to Assets > Asset Workbench > Quick Additions/New Additions > Asset Category.

User will have to complete the asset addition in Base FA and come to the India Localization screen to assign the block of asset and date of acquisition.

The user has the flexibility to assign a block name to multiple assets at one go which will increase the usability significantly.

Also, the date placed in service (which is given at the time adding the asset) will be defaulted as the Date of Acquisition. This date can be changed by the user.

Field Name Type Action Description
Block of Assets   PICK HELP Users need to enter the relevant Block of Assets in which the asset will be classified as per Indian Income Tax Act.
Date of Acquisition   User need to record the date on which the asset was acquired

Income Tax Depreciation Calculations

The calculation of written down value of the Block of asset is worked out based on the prescribed calculations that need to be carried out under Income Tax Act.

Opening Written down value of the block (as at the beginning of the assessment year)

Terms Descriptions
Add Additions during the assessment year
Less Retirements of asset from each individual assets
Less Depreciation on the opening written down value of the block
Less Depreciation on the additions during the first half of the assessment year
Less Depreciation on the additions during the second half of the assessment year

= Closing written down value of the block of asset

Run Depreciation

For calculating the depreciation under Income Tax Act, users need to run a concurrent program manually. The program is named as Income Tax Act fixed asset schedule. On completion of the program, users can view and print the output and the closing written down value will get updated.

Income Tax Act fixed asset schedule concurrent program

Users need to run Concurrent request to Calculate Depreciation for a Financial Year.

In India Localization, navigate to the Income Tax Act Fixed Asset Schedules concurrent program as follows:

Request Name: Income Tax Act Fixed Asset Schedules

The parameters for this request are described in the table below:

Field Name Type Action Description
Start Date (Required) Users need to enter start date from the LOV of a Financial year to run the depreciation calculation. Since the financial year for the Income Tax purpose is 1st April to 31st March this start date use to be 1st of April of a year.
End Name (Required) System will consider the End date as 12 month ending from the above start date.
Book Name (Required) The User need to enter Book Name where in the Depreciation Calculation is need to be done.

After completion of Run Depreciation, users can view the Fixed Assets Schedule as per Income Tax Act (Block wise) through Reports. If the user needs to add an unplanned depreciation, it can be done in the Depreciation adjustment column of Opening WDV Balance form. Unplanned Depreciation amount will be shown separately in the report output.

Reports

Fixed Assets generates these reports for India:

India Income Tax Fixed Assets Schedule

This report is a Fixed Asset Schedule as per Income Act, provides details of Block of Assets. Use the Submit Requests (India Local Fixed Asset ) form and enter India-Depreciation for one year in the Name field to submit the report.

India Depreciation Detail Report