Creating Amortization Templates

An amortization template defines the terms of the amortization schedule created by the purchase of an item. For information about the fields in an amortization schedule, see Viewing an Amortization Schedule.

For details and examples of the choices available for templates, see Amortization Template Term Reference.

The Lists permission Amortization Schedules controls access to amortization templates. For more information, see Access Levels for Permissions.

To define an amortization template:

Go to Lists > Accounting > Amortization Templates > New.
On the Amortization Template page, in the Name field, enter a name for this template.

For example, you could name a template 12 Month, Equal Distribution.
In the Type field, select the kind of template you are creating: Standard (used for most templates) or Variable (used for percent-complete recognition when the Project Management feature is enabled).
In the Method field, select a method to set the terms to post the expense from the net purchase amount.
- For descriptions of the available methods, see Amortization Methods.
- For examples of how straight-line methods work, see Straight-Line Amortization Method Examples.
- If you select Custom, you must manually specify accounts, posting periods and amounts in the columns at the bottom of the page.
  1. Account – select the target expense account to which you want to post deferred expenses.
  2. Period Offset – specify the number of periods to postpone the start of the amortization schedule for this line. The first period to amortize has an offset of zero.
  3. Amount – enter the expense amount to recognize, as a percentage or a currency value.
  4. Click Add.
  5. Repeat these substeps to define additional terms for this custom method.
  These fields are accessible only if you select Custom in the Method field.
Select a Term Source to control how the amortization period is determined.

For information about the choices for Term Source, see Amortization Term Source.
Check the Use Transaction Currency box if you want to use the foreign currency of a transaction, not your base currency, to generate the amounts on the amortization schedule. This box is part of foreign currency amortization and is available only in NetSuite U.K. editions.

For information about foreign currency amortization, see Foreign Currency Amortization.
In the Deferral Account field, select a Deferred Expense type account for posting.

Deferral accounts also can be specified in item and expense account records. See Specifying Deferral Accounts for Amortization.
In the Contra Account field, select the account that accumulates amortized balances. This account is most often used for depreciation schedules.
In the Target Account field, select the account where the expense is amortized over time. Select Default to use the expense account indicated on either the transaction or item record.
In the Amortization Period field, enter the number of periods over which the amount should be amortized. For example, you can enter 60 to amortize the amount over 60 periods starting from the amortization start date.

For examples of how the amortization period value works, see Amortization Period.
Optionally, enter the number of accounting periods to delay the start of amortization after the schedule start date. You can enter the following types of offsets:
- Period Offset moves the entire amortization period ahead by x number of periods, keeping the same number of periods, so that the end date is moved forward.
  
  For example, if the schedule dates are 1/1/06 to 6/1/06 with month-long periods and a period offset of 2, recognition starts on 3/1/06 and continues until 8/1/06.
- Start Offset delays the beginning of amortization. This changes the number of periods and keeps the same end date.
  
  For example, if the schedule dates are 1/1/06 to 6/1/06 with month-long periods and a start offset of 2, recognition starts on 3/1/06 and continues until 6/1/06.
Setting a period offset does not change the number of periods in the schedule. Setting a start offset changes the number of periods in the schedule because it postpones the beginning but does not change the final period of the schedule.

For more information, see Amortization Period Offset and Start Offset.
In the Residual field, enter an amount or percentage to remain in the deferral account and not be amortized. A residual amount generally represents the salvage value of a fixed asset.

A residual amount entered on a transaction overrides a residual amount entered on an item record.
In the Initial Amount field, enter a percentage or amount to be recognized in the first recognition period. The remaining amount is then recognized according to the set recognition method.

For more information, see Amortization Initial Amount.
Check the Inactive box to inactivate the template. Inactivated templates are saved but do not appear in lists or as choices in your account.

To view inactivated templates or reactivate them, go to Lists > Accounting > Amortization Templates, and check the Show Inactives box.
All amortization templates are public templates which means they are available to all users, items, and expenses.
Click Save.

Now, this template can be used to defer expenses by associating the template with an item you purchase. This can be done on an item record or on a purchase transaction. See Configuration for Amortization.

To view a list of available amortization templates, go to Lists > Accounting > Amortization Templates.

To define an amortization template:

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