Run monthly depreciation

Depreciation spreads the cost of an asset over the years you use it. Once a month, usually at month end, you run depreciation. Business Sensor works out each asset's charge for that month and posts it, debiting depreciation expense and crediting accumulated depreciation.

Before you start

• You need Asset Setup to see the figures, and Journal Entries to post a run or reverse one.
• Add any assets bought during the month first.
• The month must be in an open accounting period.

Steps

1. Go to Accounting → Fixed Assets → Depreciation.
2. The Month is set to the next month due. Runs go one month at a time.
3. Check the list: each asset's book value, this month's depreciation, and its value after. Assets reaching the end of their life say Fully depreciated after this run.
4. If any asset uses units of production, enter the units it was used this month (kilometres, hours, pieces) in the boxes under the list.
5. Click Post. The run is saved and the entries posted. Open it any time from Runs.

Tips

• An asset added late (bought in March but only entered in May) is caught up automatically: the next run charges all the months it missed, and says so next to the asset. Those months are posted in the run's month.
• The first month is charged for the days the asset was in service, unless its category says otherwise.
• An asset never goes below its salvage value. The last month of its life takes any rounding difference, so it ends exactly there.
• Each asset's Depreciation tab shows the full projected schedule.

Common problems

• "Run April first — runs go one month at a time". A month was skipped. Run the missing month first.
• "Already been run". That month is posted. To run it again (for example after correcting a useful life), open the run and click Reverse run, then run it again.
• "Reverse run" is missing. Only the most recent run can be reversed. Reverse the later runs first.
• "Was disposed of after this run". An asset in the run has since been sold or written off. Reverse the disposal first.
• An asset isn't in the list. It may be a draft, already fully depreciated, disposed of, set to Not depreciated, or a desktop asset that hasn't been converted yet.
• The Post button is greyed out. The month is in a closed period, there is nothing to depreciate, or you don't have the Journal Entries permission.