FAQ for Capital Asset Depreciation & Schedule Form

This FAQ explains how to use the Depreciation Schedule Form to calculate and post monthly depreciation for capital assets. It covers prerequisites, calculation logic, GL posting behavior, and step-by-step instructions to support accurate financial reporting, budgeting, and compliance.

Frequently asked questions

What is the purpose of the Depreciation Schedule Form?

The Depreciation Schedule Form automates monthly depreciation calculations using the straight-line method. This helps ensure depreciation expense is recognized consistently over an asset’s useful life and reduces the need for manual calculations.

The form also generates GL postings automatically based on the configured asset type, fund, and department mappings.

Why should I use this form each month?

Running the form each month helps ensure:

• Accurate financial reporting
• Compliance with straight-line depreciation requirements
• Timely month-end close processes
• Consistent GL postings until the asset reaches salvage value
• Updated book values and accumulated depreciation balances

What must be completed before running the form?

Before running the Depreciation Schedule Form, Asset GL Account Mappings must be configured for each depreciable asset type and each applicable fund and department combination.

These mappings determine which expense account and accumulated depreciation account the system uses when posting monthly depreciation.

How do I set up or update GL mappings for depreciation?

Go to Capital Assets > Data Management > Asset GL Accounts Mapping.

Then:

1. Click + New GL Mapping or open an existing mapping to edit it.
2. Enter the required information:
   • Action: Depreciation
   • Asset Type: such as Equipment
   • Fund: such as General Fixed Assets 901
   • Department: optional
   • Depreciation Expense Debit Account
   • Accumulated Depreciation Credit Account
3. Save the mapping.
4. Repeat for all required combinations.

What happens if GL mappings are missing?

If any required GL mapping is missing, the system stops the depreciation run, displays an error, and automatically exports an Excel file listing the missing mapping combinations.

This prevents depreciation from being posted to incomplete or incorrect accounts.

How does the system calculate monthly depreciation?

The system uses the straight-line method.

Key calculation rules include:

• Salvage value is subtracted if provided. If no salvage value is entered, the system assumes $0.
• Useful life is taken from the asset record.
• The system calculates a fixed monthly depreciation amount until the asset is fully depreciated.
• The depreciation start month is determined based on client-specific rules tied to the asset’s acquired date.

What happens in the first or partial year of depreciation?

If an asset is added mid-year, the system can prorate the first month’s depreciation based on the client’s depreciation rules.

For example, a partial first month may result in a lower depreciation amount for that month. After the first partial period, the monthly amount remains consistent unless the asset reaches its final depreciable balance.

What happens in the GL when depreciation is posted?

Each monthly depreciation run creates a journal entry using the configured GL mappings.

The posting includes:

• Debit: Depreciation Expense
• Credit: Accumulated Depreciation

These accounts are pulled directly from the Asset GL Account Mapping setup.

How do I run the Depreciation Schedule Form?

1. Go to Capital Assets > Forms > Depreciation Schedule Form.
2. Select the required fields:
   • Method: Straight Line Method
   • Fiscal Year
   • Month
3. Click Save to preview the calculated depreciation.
4. Review the totals.
5. Click Submit to post depreciation to the GL.

Why must months be processed in order?

Depreciation is cumulative, so months must be processed sequentially within the fiscal year.

For example, if the fiscal year begins in October:

• October must be completed first
• Then November becomes available
• Then December, and so on

This ensures accumulated depreciation and book value remain accurate throughout the year.

What happens after I submit the form?

Once the form is submitted:

• The system creates journal entries using the configured GL mappings
• Asset records are updated with new accumulated depreciation and book value amounts
• The form is marked as completed
• The next fiscal month becomes available for processing

What does a typical monthly depreciation posting look like?

A typical monthly posting includes:

• A debit to the depreciation expense account
• A credit to the accumulated depreciation account
• A fixed monthly amount based on the asset’s depreciable balance and useful life

For example, the monthly depreciation amount may be a fixed amount such as $208.33, repeated each month until the asset reaches its salvage value.

What happens when an asset becomes fully depreciated?

Once accumulated depreciation equals the asset’s total depreciable amount:

• Monthly depreciation becomes $0
• The system either skips additional posting or posts $0, depending on configuration
• Book value remains at salvage value
• No further depreciation is applied

Where can I review depreciation results?

You can review depreciation activity in:

• Capital Asset Reports, using the Depreciation Report type
• General Ledger, through the related journal entries
• Asset detail records, where book value and accumulated depreciation are updated

Summary

The Depreciation Schedule Form helps automate monthly straight-line depreciation, enforce GL mapping requirements, and keep asset records and financial reporting up to date. Running the form in sequence each month helps ensure depreciation is posted accurately and consistently across the fiscal year.