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Period	Deprn.	Unplanned	Deprn.	Remarks
	Expense	Deprn.	Reserve
	Remarks
1	10		10
2	10		20
3	10		30
4	7(*)	30	67	Unplanned Deprn.
5	7		74
6	7		81
7	7		88
8	7		95
9	5		100	Fully Reserved

* This amount is calculated according to the following formula:

Depreciation Expense =

(Recoverable Cost - Unplanned Depreciation Expense)

/ Original Life

= (100 - 30) / 10 = 7

Warning: In this example, the depreciation does not continue on the same schedule as before. The asset becomes fully reserved before the whole life (10 periods) is elapsed.

Currently, Oracle Assets does not automatically recalculate depreciation for the asset after the unplanned depreciation. Instead, you must make an amortized life adjustment to the asset in the period you take the unplanned depreciation. The formula for this is the following:

Ln = Lo (RC - D Rsv - U) / (RC - U)

The elements of the above formula are defined below:

Ln - The remaining periods in the asset life. Note that you have to work out how many periods have been depreciated and add this to Ln to get the new total life.

Lo - The original number of periods in the life (note that this is the life of the asset prior to the first unplanned depreciation adjustment. If you make another unplanned depreciation, you still have to use the life prior to the first unplanned depreciation adjustment, so you should keep a record of the original life).

DRsv - The accumulated depreciation up to point of unplanned depreciation.

U - The unplanned depreciation amount.

RC - The recoverable cost.

Placing the values from the earlier example in the formula results in the following:

Ln = 10 ( 100 - 30 - 30) / (100 - 30) = 5.71

Always round up the remaining life to a whole number of years/months, and add this to the number of periods already depreciated to get the new asset life.

In the above example, the new asset life is 9 periods (3 periods already depreciated plus 6 periods (5.71 rounded up) of remaining life.