Asset Types

Before creating an asset record, you must first set up asset types. Each asset must be assigned an asset type, which defaults some of the asset variables (on creation of new assets) and groups assets in reports and during processing.

To create an asset type:

  1. Go to Fixed Assets > Setup > Asset Types > New.

  2. Provide values for the following fields:

    • Name – Enter a name for the asset type. For example, Furniture & Fixtures.

    • Description – Enter a general description for the asset type.

    • Accounting Method – Select the default depreciation method (formula) to use when creating assets of this type. This method determines how values are calculated before they're recorded in the accounting system.

    • Residual Percentage – Enter the percentage of the original cost which the asset will be worth, at the end of its lifetime. For example, if you buy an asset for $1,000.00 and it's worth $100.00 at the end of its life, the residual value percentage is 10%. Entering a residual value will always override the default value calculated from the percentage.

    • Asset Lifetime – Enter the expected lifetime of the asset, in multiples of the depreciation period.

    • Operating Lease – Check this box if you'll use this asset type for assets generated from an operating lease. Clear this box if you're setting up an asset type for a finance lease.

      Note:
      • When you set the asset type to operating lease, you can't change it back to a normal asset type. Other Methods will also be tagged as Operating Lease.

      • Setting the asset type to Operating Lease will auto-compute the Residual Value Percentage.

  3. Enter values in the fields on each of the subtabs:

  4. Click Save.

    After saving the record, the Lifetimes subtab becomes available.

  5. Enter values in the Lifetimes Subtab.

  6. Click Save.

General Subtab

On the General subtab, enter values for the following fields:

Accounts Subtab

Note:

You must enter account values if the tax method is linked to an accounting book. For more information, see Linking Accounting Books to an Asset.

On the Accounts subtab, select accounts to post to for this asset type:

The following account fields are available only if your account subsidiary is set to France.

Maintenance Subtab

On the Maintenance subtab, enter maintenance information for this asset type:

Other Methods Subtab

Note:

The Other Methods subtab is available on the Asset Type record when the asset type has been created.

On the Other Methods subtab, you can assign default alternate depreciation (for analysis only) to the asset, with different asset lifetimes and residual values. This lets you track tax or corporate reporting methods on the asset. These values are calculated automatically during asset depreciation but don't generate financial transactions.

To add an alternate depreciation method to an asset type:

  1. Go to Fixed Assets > Setup > Asset Type.

  2. Click the View or Edit link next to the asset type.

  3. On the Other Methods subtab, click New FAM Default Alt Depreciation.

  4. On the FAM Default Alt Depreciation page, select an Accounting Book and Alternate Method. The available methods include only those that you've set up in Fixed Assets > Setup > Alternate Methods.

    When you select an Alternate Method, the other fields are automatically populated:

    • Depreciation Method – Sourced from Alternate Method record.

    • Convention – Sourced from Alternate Method record.

      Averaging conventions determine how depreciation is handled in the first year of an asset's depreciation. You can only use conventions with alternate methods, and by default, it's set to None. If you depreciate monthly, you can use the Mid-Month convention. If you depreciate annually, you can use the Half Year and Mid-Quarter convention. If the convention is set to Mid-Quarter, the asset starts depreciating for half of the first quarter, regardless of when it came into service during that period.

      Note:

      If the Convention value is set to None, depreciation follows the depreciation rule selected in the parent asset record. For details on the depreciation rules, see General Subtab.

    • Asset Life – Sourced from Alternate Method record.

    • Financial Year Start – Sourced from Alternate Method record.

    • Period Convention – Sourced from Alternate Method record.

    • Depreciation Period – Sourced from Depreciation Method record.

    • Subsidiary – Sourced from the Alternate Method record.

    • Residual Percentage – Must be entered in the Other Methods of the Asset Type.

  5. Click Save.

Lifetimes Subtab

On the Lifetimes subtab, click New FAM Lifetimes to add location-specific defaults for the asset type. This sets the Asset Lifetimes for the main (accounting) method based on the asset location.

Related Topics

General Notices