Wrong Depreciation Calculation by the system

Business Central/NAV User Forum
1

Dear All,

Please check the following depreciation calculation by the system.

Error Encountered - System not updating the depreciation starting date at the time of purchase invoice resulting in wrong depreciation calculation.

Suppose under the FA Card

  • Depreciation Starting Date = 01-Apr-2008.
  • Depreciation Method = Straight Line.
  • Depreciation % = 10%

Purchase Invoice is posted on 01-May-2009.

Cost of fixed asset = 1000

Now when depreciation is calculated for the financial yr 2008-2009 on 31-March-2009 it would calculate depreciation for 365 day

  • Depreciation calculated by system = 1000* 10%*365/365. = 100
  • Correct Depreciation calculation = 1000* 10% * (335)/365 = 91.78

Kindly, give you suggestion on the above error.

Navision Version used - 4.3 SP6 (Indian Localization).

Thanks,

Su Tdn.

[:D]

2

I am no expert but when you attach a depreciation book to a fixed asset you are telling the system when to start the depreciation, the fact your purchase invoice comes in later is not relevant, you have the asset on site and start depreciating it from this point, not the point when the invoice comes in. If you wanted 335 days you should have set the depreciation start date to 01-May. If it ran from the purchase invoice the number of depreciation years and months would not work to enable straight line calcualtions etc. Why do you think it should work from the purchase invoice date?

3

the system always considers the depreciation start date, and not the posting date of purchase invoice, because for ex, you may purchase a fixed asset, but not put it in use until a later date.

for this reason, if you want to depreciate starting may 1st, change the depreciation start date.