(DEU) Setting Up Multi-shift Codes
To set up multi-shift codes, use the Multi-Shift Codes (MULTI_SHIFT_DEFN) component.
This topic provides an overview of multi-shift codes and lists the page used to define multi-shift codes.
|
Page Name |
Definition Name |
Usage |
|---|---|---|
|
Multi-Shift Codes |
MULTI_SHIFT_DEFN |
Enter rates by which depreciation should be increased based on the number of production shifts that an asset is used. |
German businesses can accelerate their depreciation by specifying usage across multiple production shifts. This increases the depreciable amount and reduces the useful life. This functionality was developed to satisfy German asset accounting rules. You can do so by establishing codes for each additional shift that indicate the rate by which annual depreciation should increase. Once you have defined these codes, you can select them for assets as they are added to the system. When you run depreciation, the Depreciation (AM_DEPR_CALC) application engine applies the rates to the depreciation calculations. As annual depreciation increases, the useful life of an asset decreases.
The following tables show the effect of multi-shift codes on depreciation amounts and useful life. In the tables, the example assumes that the asset has a cost of 1,000 EUR, a useful life of 10 years, and an in-service date of January 1, 2001. The end depreciation date is December 31, 2010. It is being depreciated by using the Straight Line method.
Example Without Multi-shift Rates
The following table shows depreciation with no multi-shift rates applied.
|
Year |
NBV |
Number of Shifts |
Factor |
Depreciation Amount |
|---|---|---|---|---|
|
Year 1 |
1000 |
1 |
0% |
100 |
|
Year 2 |
900 |
1 |
0% |
100 |
|
Year 3 |
800 |
1 |
0% |
100 |
|
Year 4 |
700 |
1 |
0% |
100 |
|
Year 5 |
600 |
1 |
0% |
100 |
|
Year 6 |
500 |
1 |
0% |
100 |
|
Year 7 |
400 |
1 |
0% |
100 |
|
Year 8 |
300 |
1 |
0% |
100 |
|
Year 9 |
200 |
1 |
0% |
100 |
|
Year 10 |
100 |
1 |
0% |
100 |
Example with Multi-shift Rates
In the following multi-shift operation, the Two Shifts Factor has been established as 50 percent and the Three Shifts Factor has been established as 100 percent. Annual depreciation therefore increases, and the asset's useful life decreases from ten years to seven years:
|
Year |
NBV |
Number of Shifts |
Factor |
Depreciation Amount |
|---|---|---|---|---|
|
Year 1 |
1000 |
1 |
0% |
100 |
|
Year 2 |
900 |
1 |
0% |
100 |
|
Year 3 |
800 |
2 |
50% |
150 |
|
Year 4 |
650 |
2 |
50% |
150 |
|
Year 5 |
500 |
3 |
100% |
200 |
|
Year 6 |
300 |
3 |
100% |
200 |
|
Year 7 |
100 |
2 |
50% |
100 |
|
Year 8 |
- |
- |
- |
- |
|
Year 9 |
- |
- |
- |
- |
|
Year 10 |
- |
- |
- |
- |
Example with Multi-shift Rates by Accounting Period
The next multi-shift operation demonstrates multi-shift rates by accounting period:
|
Year |
Period |
NBV |
Number of Shifts |
Factor |
Depreciation Before Multi-shift |
Depreciation After Multi-shift |
Depreciation Periods |
|---|---|---|---|---|---|---|---|
|
Year 1 |
01-12 |
1000 |
1 |
0% |
100 |
100 |
12 |
|
Year 2 |
01-12 |
900 |
1 |
0% |
100 |
100 |
12 |
|
Year 3 |
01-09 |
800 |
2 |
50% |
75 |
112.50 |
13.5 |
|
Year 3 |
10 |
687.5 |
3 |
100% |
8.33 |
16.66 |
2 |
|
Year 3 |
11 |
670.84 |
3 |
100% |
8.33 |
16.67 |
2 |
|
Year 3 |
12 |
654.18 |
3 |
100% |
8.33 |
16.67 |
2 |
|
Year 4 |
01-12 |
637.5 |
2 |
50% |
100 |
150 |
18 |
|
Year 5 |
01-06 |
487.5 |
2 |
50% |
50 |
75 |
9 |
|
Year 5 |
07-12 |
412.5 |
1 |
0% |
50 |
50 |
6 |
|
Year 6 |
01-12 |
362.5 |
3 |
100% |
100 |
200 |
24 |
|
Year 7 |
01-12 |
162.5 |
2 |
50% |
100 |
150 |
18 |
|
Year 8 |
01-12 |
12.5 |
1 |
0% |
12.5 |
12.5 |
1.5 |
|
Year 9 |
01-12 |
- |
- |
- |
|
|
- |
|
Year 10 |
01-12 |
- |
- |
- |
|
|
- |
Note: Zero or no accounting period denotes that the whole fiscal year uses the same number of shifts. Accounting period 1 to 13 indicates multi-shift operation applies only to that specific period. If you don't set up the fiscal year or accounting period, one shift operation appears by default.