Fixed Assets - EBS (MOSC)

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Adjust STL asset life without catching up depreciation

edited Jun 4, 2015 5:28PM in Fixed Assets - EBS (MOSC) 3 commentsAnswered ✓

Is there a way to adjust the life of an asset after it's been in-service without it processing a catch-up adjustment the next time depreciation is run.

Scenario:

Corporate book using standard STL methods

The asset is $100 cost with 5 year life

One year has passed, so there is $20 AD and the NBV is $80.

We now want to change the life of the asset to 2 years, which means there is one year remaining. So, in the final year, it will should take $80 in depreciation.

However, what is actually happening is that Oracle is recalculating the entire depreciation schedule from the in-service date) using the new 2 year life and creating a catch-up adjustment. So, if the asset life was two years, then the depreciation would be $50/year. After one year,the NBV would be $50, rather than the $80 that is currently is. So it's creating an acceleration adjustment and taking the missing $30 immediately.

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