Using ACCPAC Plus for DOS 6.5 with Windowing System Manager 6.5A and Fixed Assets -

Client has a situation where they purchased a new vehicle and entered it into Fixed Assets in January and in a subsequent month in the same year the vehicle was totaled and they now want to enter the disposal of the asset. However, they do not do the monthly close because they say they receive additional costs for assets in months after originally posted and this way they can add the additional cost after the fact. But now in the disposal issue, they receive a message that the asset can not be disposed of until the month that it was originally entered is closed (which apparently completes the add cycle).

The question is: How can an asset be disposed of in the same year if monthly closes are not done? And if the monthly close must be done, how can they adjust the value of an asset entered in a prior (closed) month if they receive additional costs later?

Appreciate your time.

Gary
Banyan Business Consulting, Inc.
bogolin@banyanconsulting.com

Hi Gary

Fixed Assets was designed to provide an accurate reflection of accumulated depreciation based on a regular interval of 'period end' processing. Whether or not this is done monthly, quarterly or yearly is really up to the End User and how their depreciation schedules are setup (recovery schedules). Further to this is the fact that an Asset added to the Fixed Assets system in the current period cannot be disposed of in the same period - thus, a Period End processing is required to prepare the assets for the next depreciation process.

In a typically functional Fiscal accounting system, 'Period End' normally goes hand in hand or is synonomous with month end - to keep all integrated accounting packages running smoothly and 'on the same page' financially speaking, the 'period end' processes should coincide with each other.

To dispose an Asset in the same year it was acquired, you need to perform at least one 'End of Period', using the 'Update' option (make sure to do a backup FIRST - once you choose Update there is no going back!). (If they only want to do one EOP in any given Fiscal year, then it would logically be the Period 12, which would get the system ready for End of Year.)

Once they have completed the 'Period 12' End of Period processing, they will be able to use the 'Adjustments' menu option to adjust Acc Dep and YTD Dep for any assets that require adjusting. NOTE: Adjustments can only be entered AFTER completing the Period 12 EOP and PRIOR to doing the End of Year in Fixed Assets.

This information can be found in the FA manual as well.

Good luck!

If I understood correctly-

It was confirmed that an asset cannot be disposed of during the same period it was acquired (regardless of the length of that period). An end of period process must be run first. OK, that's exactly as I thought.

But now the second part of the original question, I'm still unclear on. Simple example:

In January you acquire an asset for $1,200, you enter it into Fixed Assets and do a period (month) end close. In March you are billed an additional $1,200 for that same asset. Can the asset value be increased and the depreciation updated to reflect what would have happened if the entire 2,400 was entered in January? (i.e monthly depreciation as booked would have been 100/mo when it should have been 200/mo). Didn't say it was a realistic example - but it is representative of what the client says they experience.

Thanks for your help.