Fixed Assets

This document is a guide on how to use the functions on the Fixed Assets menu in the G/L Module.

This module will let you to create Fixed Assets, Depreciate the Assets, Report on the Assets and Dispose or Transfer Assets.

The Fixed Assets functions allow users to keep track of the company’s Fixed Assets, such as:

When they were purchased
Where they are located
How much they have depreciated
If they were sold or disposed of
If they were transferred between departments.

Assets can be entered into the system either automatically when entering a Purchase Invoice in the A/P Module or directly through Fixed Asset Maintenance. An asset is always assigned to a Department. You can define different Asset Types (such as furniture, automobiles or computers). The system allows four different methods of depreciating your assets.

Setup

The following items should be set up before entering your first Fixed Asset.

Department Setup

Because all assets must be assigned to a Department, first make sure that a list of departments has been set up in the A/P Module (examples: Accounts Payable, Human Resources, and Administration). To view the current list of Departments, navigate to A/P Module -> System Tables Setup -> Department Setup.

To add a new Department, enter the desired ID and Name on the bottom row and then click the “+” icon. A Salaries Payable GL Code may be entered if this Department will also be used in the A/P Module.

Asset Type Setup

For each Department, set up a list of product categories, such as: computer hardware, computer software, telephone equipment, office furniture, office supplies. To view or create these Asset Types, navigate to Fixed Assets -> Asset Type Setup. For each department/category combination, designate the G/L Accounts that will be used to track that Asset Type in the General Ledger. Start typing the description or G/L account number and the system will reveal a list of accounts which include this account.

Depreciation Method

Finally, for each department/category combination, designate the default depreciation method and rate. During entry of a fixed asset, this default will populate when the asset type is selected but may be overwritten for individual assets.

Straight Line - the asset depreciates every year by the percentage entered. A steady decline of the value annually.

Reducing balance - the asset depreciates every year by the percentage entered, but the book value of the asset (cost less accumulated depreciation) is used instead of the original cost. So, if the asset is at a $100 value, and is set to depreciate by 2% per year, the value becomes $98 after the first period. The next period the beginning value is $98 and the depreciation by 2% per period is $96.04, and so forth.

Fixed Amount – a specific dollar amount of depreciation every period for the asset.

Accelerated - every period the asset depreciates by a certain percent according to the accelerated depreciation schedule that is entered. The schedule lists the periods through which the annual percentage rate is as entered.

For example, in the above schedule the annual rate is 50% for the first 6 periods (or 4.167% per period), then 30% from period 7 through 10 (2.5% per period), then 15% from period 11 through 20 (1.25% per period), etc.

G/L Account Maintenance

After creating Asset Types, user may also go to each asset G/L account to add the fixed asset type as a reference on the G/L account. Navigate to G/L Module -> Accounts -> G/L Account Maintenance.

The detail accounts node is highlighted. Click the magnifying glass to search for a G/L account with description including “asset.” Choose the G/L account, and then scroll to the fixed asset type field in the advanced account settings section and choose one from the drop-down menu. Save the G/L account.

This enables the automatic entry of fixed assets while entering purchase invoices if such a G/L account is used on the invoice.

Creating a Fixed Asset

Fixed assets can be entered into the system either automatically when entering a purchase invoice or directly through fixed asset maintenance. Fixed assets may also be imported from a spreadsheet, adding convenience and additional features for use with pre-existing fixed assets.

Note that:

Each Asset must be tied to an Asset Type
An Asset can be tied to an A/P Invoice
You must specify the Purchase Amount and the start Period for depreciation
You can store documents, photos and Asset details (such as location, serial number) on the Asset

For example, we purchased a Laptop computer for someone in the Finance Department. It cost $1,500 and we are going to start depreciating it in January 2020. By assigning this asset to an Asset Type, the system will know the depreciation method and G/L allocation.

A/P Invoice Entry

To create a fixed asset automatically when entering a Purchase Invoice, navigate to A/P Module -> Invoices -> A/P Invoice Entry -> Enter/Edit Invoices. This allows the user to create the asset and invoice in one easy step, linking the invoice to the fixed asset. Enter the Invoice as usual, then enter a G/L Account that has a fixed asset type set up. The system will then prompt the user to give more details about this asset.

Fill in the fields accordingly and save. Also note that the G/L line item has a building block icon to edit the fixed asset information, different from the other G/L line items which are not fixed asset related.

Click the save button and note the invoice ID. The purchase invoice still needs to be posted to A/P and posted to G/L for the new fixed asset record to be created.

If you then retrieve the fixed asset from the fixed asset maintenance menu, observe that the asset has the invoice ID linked to it. Also, fixed assets entered this way will be marked with “From A/P Invoice” = YES to distinguish them from fixed assets that are directly entered yet based on an existing A/P invoice.

Fixed Asset Maintenance

To create a fixed asset directly, navigate to Fixed Assets -> Fixed Asset Maintenance and use the “New” button. Enter an asset description and vendor ID.

Optionally, if the asset is based on an existing A/P Invoice, choose an invoice ID for this vendor. User can use the magnifying glass to search for an invoice ID. The purchase date, purchase period (and therefore depreciation start period), and amount will populate using data from the invoice. User cannot create a new invoice from this screen to attach to the fixed asset.

Then choose the department and all the asset types created previously will pop up in the list. Selecting an asset type will default-in the depreciation method, rate, and G/L account settings per the set up.

Note that if the depreciation method is “Accelerated,” then the depreciation rate will not default-in because the system does not refer to this field for the rate. However, it is still a required field so user will need to enter some data, typically the depreciation rate from the first row of the accelerated depreciation schedule.

Enter the purchase date and purchase period. The depreciation period will default to the same as the purchase period indicating that the fixed asset may be depreciated in the same month as purchased. If this is not the case, then user must manually change the depreciation period to the following month.

Finally, enter the purchase amount and <Save> the record. Note that the system is not currently designed to account for salvage value. To record fixed assets that have a salvage value, user could enter the current net book value as a modified purchase amount and note the adjustment in the comments field.

Also note that depreciation to-date may not be entered directly. If a fixed asset is not truly new and already has accumulated depreciation, then it should be imported instead of entered directly. Otherwise, user could enter the current net book value as a modified purchase amount and note the adjustment in the comments field.

User may also enter more details about the fixed asset on the other information shutter.

Import Fixed Assets

To create a fixed asset by importing from a spreadsheet, navigate to the menu Fixed Assets -> Import Fixed Assets. Then click “download template”.

Fill out the template and note that the bold columns are mandatory. The ones highlighted in yellow must match an existing ID in the system. Also note that import fixed assets does not allow for the creation of assets with an accelerated depreciation method. This is because the required accelerated depreciation schedule cannot be entered into the import file.

If a fixed asset is pre-existing (i.e. already has accumulated depreciation against it) outside of the system, then the depreciation to-date column may be non-zero. This is the only method of creating new fixed assets in the system with depreciation already recorded.

Save the completed template to your desktop. Then click the select button and browse for the saved file and click select. Enter the depreciation to-date financial period, and then click test import file button in order to ensure no errors exist in the file.

If there are errors, click the OK button to view the nature of the errors. Then correct the errors in the excel template and save it again. Click the button remove to remove the previous file and then select it again. Click the test import file button again. When there is success, click the import file button. Once imported, then the fixed assets from the file will be searchable in the system.

Import Template

Field Name

Example

Conditions

Mandatory/ Optional

Asset Description

test

Free alphanumeric entry

Mandatory

Vendor ID

SH1

Vendor ID must match the vendor in Naviga Vendor Setup

Optional

Invoice ID

SH123

Must match the invoice ID in Naviga

Optional

Purchase Amount

1000

Free entry numeric value

Mandatory

Purchase Date

1/1/2021

Date entry according to system format

Mandatory

Purchase Period

2021-01

Must match the financial period format and value in Naviga

Mandatory

Depreciation to Date

2/1/2021

Free date entry as per Naviga format

Mandatory

Department ID

Art

Department ID as per the value in Naviga in AP menu Setup -> System Tables Setup -> Department Setup. This is where this asset is linked to the department on import.

Mandatory

Asset Type

Must match the value in the menu Fixed Assets -> Fixed Assets Type

Mandatory

Depreciation Method

The values are as follows: 1 (Straight Line) 2 (Reducing Balance) 3 (Fixed Amount)

Mandatory

Depreciation Rate

Percent per year numeric value

Mandatory

Serial No

434343