Asset Disposal by Sale or Write-Off

The Fixed Assets Management SuiteApp enables you to write-off or sell a simple or compound asset. When a fixed asset is disposed during, or at the end of its useful economic life, an adjustment needs to be made to the depreciation provision account so that the account balance represents only the accumulated depreciation to date on fixed assets held at that point in time.

Disposing an asset by sale lets you enter a proceeds value and post the difference between the net book value and the proceeds earned from the sale of the asset to the general ledger. A sales invoice is created using the Disposal Item as the line item, and the asset status is set to Disposed.

Writing off an asset will post the net book value and cumulative depreciation of the asset to the general ledger and set the book value and cumulative depreciation of the asset to zero.

During asset disposal, the system creates depreciation histories for the asset's accounting methods and tax methods (Depreciation History and Alternate Depreciation History Sublist). Asset disposal is applied for both accounting and alternate/tax methods, where the amount sold is separately calculated for each of the methods. For accounting methods, the amount is sourced from the Asset Current Cost in the FAM Asset record. For alternate/tax methods, the amount is sourced from the Current Cost in the FAM Alternate Depreciation record.

To access the Asset Sale/Disposal page, go to Fixed Assets > Transactions > Asset Disposal.

To sell an asset:

1. Go to Fixed Assets > Transactions > Asset Disposal.

2. On the Primary Information field group, provide values for the following fields:

   • Disposal Type – Select Sale.

   • Disposal Date – Enter a posting date for the disposal.

   • Consolidate Line Items on Invoice – Check this box to sum up the sales amount of all assets for disposal, and consolidate it into a single line item on the invoice. Clear this box to itemize each asset for disposal on the invoice.

   • Customer – Select the customer that the asset is being sold to.

   • Sales Tax Code – Select the tax code that applies to this sale.

     Note:

     If SuiteTax is enabled on your account, the SuiteTax engine will automatically set the tax code on the invoice. This field is not available if you are using SuiteTax. For more information, see General SuiteTax Topics.

   • Sale Item – Select the sale item that will appear on the invoice.

     Note:

     The Sale Item list is unfiltered and may contain items which are not valid for disposal through sale. When you select an invalid item, an error will prompt you to select an item for sale or resale.

   Note:

   For OneWorld accounts, the customer, asset, sales tax code, and sale item must have the same subsidiary.

3. On the Disposal Details field group, provide values for the following fields:

   • Asset ID/Name – Select the desired asset by name or ID. You can enter a simple asset, compound asset, or component asset.

     Note:

     If you selected a compound asset, all of its components will be added to the page for disposal. The disposal process is the same for simple assets and component assets.

   • Quantity To Dispose – Enter the quantity of assets being sold.

   • Sales Amount – Enter the sales amount.

   • Location – If the Multi-Location Inventory (MLI) feature is enabled, asset disposal by sale requires setting a location value. If available, the location value is sourced from the FAM asset record by default and cannot be edited to prevent untracked location transfers. If not available from the asset record, you must select the value in the Location list on the Sale/Disposal page.

4. Click Add.

   If you want to dispose multiple assets in a single transaction, enter another asset in the Disposal Details section. Repeat step 3 as necessary.

   Important:

   Check to make sure that the asset you are currently processing is the asset that you want to dispose. Disposed assets can no longer be retrieved.

5. Click Dispose.

   A Sale depreciation history record and a book generic sales invoice is created and the asset status is set to Disposed.

   If you have enabled the Custom Transactions and Use Custom Journals preference, a specific journal entry will be created for asset disposal. You can view these journal entries in Fixed Assets > Transactions > Journal Types. Note that you have to manually set the status of the journal entry to Approved before it is posted. For more information, see Viewing and Approving Custom Journal Entries.

   Note that if the Require Approvals on Journal Entries preference is enabled, and you do not have permission to approve journal entries, the system will require administrator approval before a journal entry is posted.

To dispose (write off) an asset:

1. Go to Fixed Assets > Transactions > Asset Disposal.

2. On the Primary Information section, provide values for the following fields:

   • Disposal Type – Select Write-off.

   • Disposal Date – Enter a posting date for the disposal.

3. On the Disposal Details section, provide values for the following fields:

   • Asset ID/Name – Select the desired asset by name or ID. You can enter a simple asset, compound asset, or component asset.

     Note:

     If you selected a compound asset, all of its components will be added to the page for disposal. The disposal process is the same for simple assets and component assets.

   • Quantity To Dispose – Enter the quantity of assets being sold.

   • Location – If available, the location value is sourced from the FAM asset record by default and cannot be edited to prevent untracked location transfers. If not available from the asset record, you must select the value in the Location list on the Sale/Disposal page.

4. Click Add.

   If you want to dispose multiple assets in a single transaction, enter another asset in the Disposal Details section. Repeat step 3 as necessary.

   Important:

   Check to make sure that the asset you are currently processing is the asset that you want to dispose. Disposed assets can no longer be retrieved.

5. Click Dispose. Writing off an asset sets the book value of the asset to zero.

   A Disposal depreciation history record will be created. When the Multi-Book Accounting feature is enabled on your account, a journal entry will also be generated to write off tax methods that are associated to accounting books.

   If you have enabled the Custom Transactions and Use Custom Journals preference, a specific journal entry will be created for asset disposal. You can view these journal entries in Fixed Assets > Transactions > Journal Types. Note that you have to manually set the status of the journal entry to Approved before it is posted. For more information, see Viewing and Approving Custom Journal Entries.

   Note that if the Require Approvals on Journal Entries preference is enabled, and you do not have permission to approve journal entries, the system will require administrator approval before a journal entry is posted.

You will be redirected to the Process Status page, where you can track the status of the disposal. On the Process Status page, the following processes will be queued for asset disposal. You can click the Details link on any process to view the process stage details.

Process	Process Stage	Process Stage Description
Asset Disposal	Dispose Asset	Processes the asset for disposal.
	Update Related Records	Links the invoice to the asset record, if disposal is successful. In case of failure, changes made in the previous stage will be reverted.
	Delete Old Forecast Values	System deletes the existing depreciation schedule since it is longer accurate after the asset is disposed.
	Update Compound Assets	Updates compound asset records.
	Update Related Records	Updates other records related to this asset.
Generate Depreciation Schedule	Generate Depreciation Schedule Values	Creates new depreciation history records for generated assets and tax methods.

To process multiple asset disposals using CSV import

1. Go to Fixed Assets > Transactions > Asset Disposal.

   Note:

   You cannot add columns or custom fields to this type of import.

2. On the Asset Sale/Disposal page, click Import CSV.

3. On the Bulk Asset Disposal page, click Choose File to open the file browser, and then select the CSV file that contains the records you want to process.

   You can click the link below Choose file button to view a sample file.

4. Check the Consolidate Line Items on Invoice box to sum up the sales amount of all assets for disposal, and consolidate it into a single line item on the invoice.

5. Click Submit.

   The following table shows sample disposal values for a CSV import:

   Disposal Type	Disposal Date	Customer	Tax Code	Sale Item	Asset	Quantity to Dispose	Sale Amount	Location
   Sale	1/31/2015	Customer ABC	-Not Taxable-	Item for Disposal	79	3	7,000.00	California

   Use the following mapping to enter values in your CSV file:

   Header	Value
   Disposal Type	Must match the disposal type.
   Disposal Date	Must match the disposal date and must not be earlier than the last depreciation date. Important: To avoid inaccuracies when disposing the asset, make sure that the date format in the CSV file follows the date format set by the administrator in the General Preference page (Setup > Company > General Preference). To check the date format, contact your account administrator.
   Customer	Must match the customer name. The asset and the customer must be under the same subsidiary. Leave blank if the disposal type is Write Off.
   Tax Code	Must match the applicable tax code for the customer’s subsidiary. Important: Remove this field or leave it blank if you are using SuiteTax, or if the disposal type is Write Off.
   Sale Item	Must match the name of the non inventory item to be used for disposal. The asset and the sale item must be under the same subsidiary. Leave blank if the disposal type is Write Off.
   Asset	Must match the asset internal ID.
   Quantity to Dispose	Must match the quantity of assets to be disposed.
   Sale Amount	Enter the value to sell the asset. Must not be zero (0) or less. Leave blank if the disposal type is Write Off.
   Location	Must be under the same subsidiary as the asset’s current location.

When the Multi-Book Accounting feature is enabled on your account, a journal entry will also be generated to write off tax methods that are associated to accounting books. For information about multi-book asset disposal, see Disposing an Asset in Multiple Books.

Related Topics

Fixed Assets Management Overview

Depreciation Methods

Creating Asset Records from Transactions

Creating Asset Records through CSV Import

Creating Asset Records Manually

Managing Assets

Fixed Asset Recovery Script

Asset Depreciation

Group Tax Depreciation

French Derogatory Depreciation

Partial Disposal of an Asset

Revaluation of an Asset

Asset Split

Asset Transfer

Fixed Asset Recovery Script

Deleting Assets

General Notices