Every business has critical financial and reporting needs, and when it comes to tracking your fixed assets, you need to be able to produce fixed asset reports, maintain purchase requests for assets, reconcile assets, and maintain tax information, which can be a lot to handle. That’s where Oracle’s JD Edwards EnterpriseOne Fixed Assets comes in.
With JD Edwards EnterpriseOne Fixed Assets, you control the fixed asset accounting lifecycle, from acquisition and depreciation to revaluation and disposal. Some of the key features of the solution include:
- Making changes across your accounting structure (without having to hard code or custom program)
- Automate asset setup to update asset information on your schedule, whether that’s daily, monthly, quarterly, or annually
- Track alternate depreciation projections when budget planning
There’s a lot to JD Edwards EnterpriseOne Fixed Assets, so let’s focus specifically on how flexible depreciation methods can help you boost the profitability of your fixed assets.
Asset Depreciation Methods
To increase the value of your fixed-asset inventory (and improve profitability), Fixed Asset Accounting enables you to select the most favorable depreciation method for each asset in your organization. You can define and maintain an unlimited number of depreciation methods by using or modifying the predefined methods, or even create a custom method if you need to. Additionally, you can calculate depreciation whether you’re working on a daily, weekly, monthly, quarterly, or annual timeframe.
If your organization operates in a multi-site, multi-national, or multi-currency environment, you’ll need more variations of depreciation elements. Thanks to asset depreciation, you can leverage all the parts of the depreciation equation and use those elements to define depreciation methods to meet your organization’s unique needs.
Elements of Depreciation Rules
When you create a master record, the system automatically assigns a depreciation method based on the depreciation default value that you’ve set up. The system then performs depreciation calculations based on the established depreciation rules for each depreciation method.
Here are some elements used with depreciation rules that control how the system calculates depreciation:
The life of an asset is represented in the depreciation process as a subdivision of time. The subdivision of time could be several things, such as your organization’s fiscal year, the date when the asset was purchased, or the year of a specific regulatory entity.
Costs can be divided in many different ways for an asset according to its nature, such as a piece of equipment, a building, a tract of land, and so forth. Costs can also occur for a single asset in multiple books for financial accounting, consolidated reporting, management and cost accounting, and regulatory purposes, (so a tool that tackles that for you can help prevent a lot of headaches…)
Dates are essential because many instances occur in the depreciation process, such as asset acquisition, depreciation, and disposal dates.
Accumulated depreciation is a fairly simple element. It refers to the total of all deprecation taken during the life of an asset.
Net Book Value
The net book value equals the cost of an asset minus the accumulated depreciation.
The first and last year of an asset’s life can be subject to different regulatory requirements.
Salvage Value and Depreciable Basis
These refer to the residual value of an asset at the end of life.
Finally, the remaining basis is the amount to which an asset depreciates in the final year of its life.
Implementing JD Edwards Fixed Assets
Accounting for fixed assets can be a balancing act. Not only do you have to consider maintaining compliance with changing tax and accounting regulations, but you have to do so all while constantly updating your fixed assets and juggling various depreciation methods to maximize their profitability.
Take some of that hard work off your plate with JD Edwards Fixed Assets. If you’re looking to getter a better handle on your depreciation schedules, would like to implement the solution, or need help with any other part of your JD Edwards platform, Surety Systems is here to help.
Our senior-level JD Edwards consulting team has the experience you need to make tracking your fixed assets a breeze. Contact us today to get started.