Asset Book
An asset book is one set of values for an asset. Most companies keep one, the accounting book that posts to the general ledger. A company that must also show tax depreciation keeps a second book with its own profile. An asset is acquired, depreciated and valued separately in each book it is kept in.
What it is for
The book decides how an asset in it depreciates (through its profile), where the depreciation year comes from (its calendar), how the amounts are rounded, how low the value may go, and whether its acquisitions post to the general ledger.
The rule people get wrong: Post To General Ledger is read by Asset Acquisition only. Asset Depreciation and Asset Retirement do not read it, so a depreciation run makes its voucher whatever this tick says.
Every field in plain words
| Field | What it means | What to put |
|---|---|---|
| Asset Book | The code of the book | ACC, TAX. Required, and must not already exist |
| Name | What the book is | Accounting book. Required |
| Calculate Depreciation | A switch for depreciation | Nothing reads it. Every book with acquisitions is depreciated by the run |
| Depreciation Profile | The profile this book depreciates by | Pick from Depreciation Profile. An acquisition takes its method and frequency from here |
| Roundoff Depreciation | The number of decimal places each depreciation amount is rounded to | 2 for cents, 0 for whole units |
| Roundoff Depreciation in Reporting Current | The same, in a reporting currency | Nothing reads it |
| Leave Net Book Value At | The value depreciation stops at | 1 to keep every asset on the books at one unit; 0 to depreciate to the salvage value |
| Leave Net Book Value at Reporting Current | The same, in a reporting currency | Nothing reads it |
| Create Depreciation Adjustments With Basis Adjustments | A switch for adjustments | Nothing reads it |
| Opening | This book takes assets that existed before go-live | Tick for the take-on book. Ticking it clears Post To General Ledger |
| Post To General Ledger | Acquisitions in this book make a journal voucher | Tick for the accounting book. Ticking it clears Opening |
| Posting Layer | A posting layer for the book | Nothing reads it. The voucher's layer comes from its journal |
| Allow Net Book Value Higher Than Acquisition Costs | A switch for revaluation | Nothing reads it |
| Allow Negative Net Book Value | A switch for negative values | Nothing reads it. Depreciation never goes below the floor in any case |
| Calendar | The fiscal calendar the book's fiscal year comes from | Pick one. Left empty, the legal entity's calendar on Ledger Setup is used |
How to configure it
- Make the accounting book: profile, rounding 2, Post To General Ledger ticked.
- If the company brings in assets that were already on its books before Businessflo, you can acquire them into a book with Opening ticked. The acquisition then does not propose the purchase cost and clearing account, and makes no voucher. Opening balances of the general ledger are entered there separately.
- If a tax book is needed, make it with its own profile and leave Post To General Ledger off.
- Add each book to the Asset Book tab of every Asset Group kept in it.
Scenarios
- One book, everything posted. Book ACC, straight-line monthly profile, Post To General Ledger ticked.
- Assets bought before go-live, already depreciated. Acquire each into the book with the cost as Acquisition Amount and the depreciation already charged as Initial Depreciation Amount. The book's general ledger opening balance carries the totals.
- A tax book beside the accounting book. Book TAX with a reducing-balance profile and Post To General Ledger off. Its acquisitions make no voucher. Note that its depreciation run does make a voucher (see the rule above).
What it is connected to
- Depreciation Profile is named here.
- Asset Group lists the books each group is kept in.
- Asset Acquisition reads Post To General Ledger and Opening.
- Asset Depreciation reads the profile, the calendar, Roundoff Depreciation and Leave Net Book Value At.
- Set up a new company - where this screen fits in the setup order.
If something looks wrong
- "Asset Book cannot be empty", "Name cannot be empty" or "Similar Asset Book already exists". The code or name is missing, or the code is already used.
- A tax book's depreciation posted a voucher. Asset Depreciation does not read Post To General Ledger. Run depreciation for the tax book with care, or reverse the run.
- Depreciation stops above zero. Leave Net Book Value At, plus the salvage value of the acquisition, is the floor.