Depreciation Reversal Utility

Utilities Menu -> Inventory Control -> Depreciation Reversal Utility

This utility can be used to reverse all 'Straight Line Depreciation' and 'Declining Balance' standard transactions calculated and posted for rental inventory in Depreciation.
 This action does not apply to the Alternate Depreciation records and they are not reversed.

Resulting reversing Straight Line and Declining Balance Depreciation records are added to the Fixed Asset Tags for eligible Bulk and Non-Bulk products in the Rental Inventory as of the original depreciated date.

If the feature to Post Depreciation to G/L is activated in the Company Posting Parameters, and the posting accounts for Accumulated Depreciation and for the Depreciation Expense are setup in the "Depreciation Accounts" windows of Depreciation Classes, reversing G/L posting transactions are also written to the General Ledger for Non-Bulk equipment as of the selected Post Date for Depreciation Reversal.
 A posting journal is generated following the "Non-Bulk Depreciation Changes Report" summarizing the accounts, divisions, and amounts that will be posted.
 No G/L reversing transactions are generated for the Bulk rental products, even though the depreciation is reversed on the Fixed Asset Tags in the sub-ledger. Manual adjustments will be required in the G/L to complete Bulk product reversals.

Note: Depreciation Methods other than Straight Line and Declining Balance are not reversed and the products within the date range are listed on the "Excluded Report".

The following criteria must apply for a Tag to be selected for Depreciation reversal:

•All Bulk Disposals must be cleared in Allocate Bulk Disposals.

•Asset Tag must have Depreciation History records dated on or after the selected cut-off date.

•Asset Tag must have a Quantity (original quantity - quantity sold - quantity transferred = greater than zero).
 This means depreciation for disposed inventory with zero quantity will not be reversed.

•Depreciation Class currently on the Tag uses method S (Straight Line) or D (Declining Balance).

•Accumulated Depreciation dollar amount on Asset Tag must be greater than zero.

•Depreciation Class assigned on the Tag, must have valid GL Accounts defined in Depreciation Classes if the feature to Post Depreciation to G/L is activated in the Company Posting Parameters.

The prompts include:

REVERSE ALL STRAIGHT LINE AND DECLINING BALANCE DEPRECIATION ON OR AFTER

Accept the current fiscal year start as defined by the date set in Summarize G/L for Financial Statements to reverse depreciation calculated for the current year, or enter a preferred reversing start date.
 Straight Line and Declining Balance depreciation calculated on all rental equipment after this date will be reversed.

YEAR START FOR STRAIGHT LINE YEAR TO DATE NUMBER AND DOLLAR DEPRECIATION

This date defaults to the fiscal year start of the "Depreciation Cut-off" date selected above, and cannot be over-typed.
 It is used to update the YTD depreciation dollars and number of depreciations on the Asset Tag to reflect the reversals of Straight Line depreciation.

POSTING DATE FOR REVERSAL

This field only applies to Non-Bulk Rental equipment when the feature to Post Depreciation to G/L is activated in the Company Posting Parameters.

When reversing depreciation amounts are posted to the G/L for Non-Bulk Rentals, this becomes the date of the reversing depreciation transactions in the G/L.
 However the reversing date on the 'Asset Tags' in the inventory sub-ledger is always the date of the original depreciation record.

REPORT OPTIONS

This value defaults to the operator preference as defined in Operators.
 Select one of the output options to Print a report or export the data to Excel as outlined in Report Options.

Finished?

Click the ACCEPT button to begin printing the report, or CANCEL to abort.

Note: A warning note is displayed on the screen if any asset has been changed to/from the Straight Line method to/from Declining Balance depreciation method in their lifetime.

Resulting Reports

The following reports or spreadsheets are generated:

1.Non-Bulk Rental Equipment Depreciation Changes:
 a) Each non-bulk product number to be reversed is listed with the description, Asset Tag number, Depreciation Class, Book Value, Current Depreciation, Depreciation History Division, Depreciation Date, Reversed Amount, new Book Value, new YTD number of Depreciations and new YTD Depreciation Amount.

b) If the feature to Post Depreciation to G/L is activated in the Company Posting Parameters, a posting journal is generated following the "Non-Bulk Depreciation Changes Report" summarizing the accounts, divisions, and amounts that will be posted to the G/L for reversing the depreciation.
 This posting information is included on a second tab when the output is exported to a spreadsheet.

2.Bulk Rental Product Depreciation Changes:
 Each non-bulk product number to be reversed is listed with the description, Asset Tag number, Depreciation Class, Book Value, Current Depreciation, (Division is blank for bulk products), Depreciation Date, Reversed Amount, and new Book Value.

3.Items Excluded from Depreciation Reversal:
 Product numbers that are not eligible for reversal are listed with the description, Asset Tag number, Tag Status, Quantity, Book Value, Current Depreciation, and reason for the exclusion.
 Products and Tags on this excluded report or spreadsheet are those that have quantity and have depreciation history but did not meet the other criteria listed above to be eligible for reversal on the bulk or non-bulk reports. This includes products that use other depreciation methods.
 Depreciation reversal will also fail if the product does not have valid posting accounts defined in the Depreciation Classes when Post Depreciation to G/L is activated in the Company Posting Parameters.

REVERSE ALL DEPRECIATION ON/AFTER _______

The original "cut-off" date for reversing depreciation is displayed for reference.

After reviewing the report or spreadsheet output, click ACCEPT to post the changes to the Asset Tags in the inventory sub-ledger and to post the reversing transactions to the G/L, or click CANCEL to abort postings.

Note: If the depreciation method on a tag had been changed from/to Straight Line/Declining Balance, to avoid subsequent depreciation calculations from being distorted, the YTD number of depreciations and the YTD dollars will be set to zero on the date that the method was changed.

Topic Keyword: RSAD21 (4416)