Fixed Assets and Depreciation Methods

I started a new job and it has become my responsibility to set up the Fixed Asset granule and I have virtually no experience in this area. For the most part, in our old system, we used a declining balance 200%, 150% etc., switching to straight line when applicable. I used the DB1/SL methods for the TAX and AMT books I set up and chose Straight Line for the Internal bookkeeping. My problem is when calculating depreciation the figures I get with Navision calculations and the figures from the old system don’t always match up. So, for instance if the old books used a 200% DB switching to straight line for an item with 5 years to depreciate, I entered the number of years as 5 and the percentage as 40%, For the 150% I used 5 years and 30%. For a 7 year item I used 21.42% and 7 years and 28.57% and 7 years. The 5 year item calculated the same, but the 7 year item was off by a range varying from cents to several dollars. Can someone tell me why I may be getting a difference in calculated amounts between these programs? Will I have to manually adjust for the differences by posting adjustments with a journal batch?

It is possible that there are some small differences between systems. This may be rounding methods or other (very) subtle program differences - but I do not know of any problems with Navisions calculation methods. If you are setting up the new system with assets that are part depreciated, I would recommend that you re-aquire them via a FA journal with the dates that the assets where originally purchase, and then let the system work out the depreciation up to date. I did this recently with a book value of around $5m aquired upto 10 years ago, and the Navision depreciation was about $200 different. We felt this was an acceptable tolerance and just made a single corrective journal. Don’t forget that Navision works its depreciation out on a day basis, not month basis so a 30 day month will carry a diffent depreciation value to a 31 day month - could this account for some of your variance?

Hi all, If I’m not wrong, Navision Attain’s accounting period is based on 360 days per year. That might cause a slight difference in depreciation.

As Patrick has pointed out navision does use 360 days /year norm. the slight differences would be visible in case where the time period of depraciation is not exactly equal to 1 years or integere multiple of months. Check if there are any discrepencies in cases where the time period is exactly 1 year. If there are discrepenceis then it is a cause for concern.