This chapter contains the topic:
Businesses in Germany must report assets at the net value at which the assets are acquired. For example, if a business receives a discount upon the acquisition of an asset, the discounted amount is recorded as the value of the asset. The difference between the discounted amount and actual value of the asset is maintained in an offsetting account.
The insurance values of assets that belong to a business are based on an indexed value. The index is posted yearly by the Germany statistical authority. Businesses in Germany must use the indexed value for the asset as of its purchase date and then calculate forward to the current date to report the asset's actual value.
According to the index, businesses must group assets into different categories, based on the type of asset. For each category, two indices are used to compute the actual acquisition cost. You use the first index to deduct the value of the asset to the base year (currently 1970). You use the second index to compute the current acquisition cost.
You can use J.D. Edwards base software to manage asset valuation. To maintain accurate asset valuation records in Germany, you must:
Set up category codes to assign the base year index to each asset.
Set up user defined depreciation rules for the index of each current year. To do this, multiply the asset cost by the base year index multiplied by the current year's index.
Apply the rules to an insurance ledger.
Run the User Defined Depreciation program for the insurance ledger.
Run World Writer reporting to retrieve the current acquisition cost.
See Also: