Depreciated Group Assets

Each group asset is associated with an average service life that is usually set by the local regulatory agency. The system uses the asset's remaining service life to calculate a group depreciation rate. The group depreciation rate is usually calculated annually and remains fixed for the entire year. The system then applies this rate to the asset's depreciable basis (the sum of the depreciable bases of its group members) to calculate depreciation expense.

Depreciation expense is booked to general ledger by applying the depreciation rate either to an average account balance for the period (using an averaging option) or to actual activity for the period.

Average service life studies provide the basis for calculating average remaining life for a group of assets. Average service life studies are performed every three or four years, depending on the length of the local regulatory agency's rate cases.

Because depreciation rates are calculated by using remaining service life at the group asset level, and depreciation also takes place at the group asset level, it is not possible to over-depreciate group members.

Flat rate depreciation methods calculate depreciation until the calendar ends. Alternatively, if you don't want to calculate depreciation until the end of the associated calendar, you can specify the number of future years for which depreciation should be calculated when you add the asset.

Note:

PeopleSoft Asset Management supports only the flat rate depreciation method for group asset processing.

Note:

For optimal processing performance and greater table efficiency, you should specify the number of future years for which depreciation will be calculated rather than calculating it to the end of the calendar. Use the Future Depreciation Years option to do this.