The Asset Classifications form is displayed when the Classifications option is selected from the ASSET REGISTER menu.
Before you can create any Asset Records, however, you must first set up Asset Classes on the Register. Once the Classes have been set up, you may thereafter create as many Asset Records as are required.
Each time you create a new Asset Record, the system will prompt you to specify the Asset Class to which you wish to assign that asset. Common examples of Asset Classes are Land & Buildings, Plant & Machinery, Motor Vehicles.,etc.
The purpose of an Asset Class is to enable you to bring together individual assets of a common type into a single category. You can then assign certain features to the category, which will determine how the system handles individual assets within it. For each Asset Class, you can:
Define default values for five of the data fields on every Asset Record; these default values may be overwritten for any particular Record except for the Nominal Ledger Account code.
Specify the Nominal Ledger Balance Sheet Account Code for all Asset Records within this Asset Class.
Specify the respective Nominal Ledger accounts to which financial information will be posted following usage of the Depreciation and Add or modify assets options.
Specify the Annual Percentage Rate [i.e the yearly percentage amount] or Annual Reduction Rate [the amount the depreciation amount will be reduced by when using reducing balance depreciation methods] to be used, where required, in the calculation of depreciation.
The option for creating, amending, deleting Asset Classes is Classifications, located on the Asset Register Menu. Classes may be erased only if they have no Records currently assigned to them.
Depending on your access priority, you may not be able to view or edit certain asset classes. There may be some you can view but not edit. Managers are able to give individual Asset Classes edit and view priority levels.
To create a new Asset Class, or to view, edit or delete an existing one:
Select the Classifications option from the Asset Register Menu.
There are buttons on the right hand side of the form. With these you can specify whether you wish to Create, Amend or Delete an Asset Class on the Register. If you do not choose any of these options it assumes you just wish to view an asset class.
If you have clicked on the Create button you may now input details of the new Asset Class beginning with the Asset Class code field at the top left of the screen.
Search Facility: The Asset Class field has a Search facility that can be used to select the required Class code.
To move down through the data fields on this screen:
Press the TAB key; to move back up.
Press the SHIFT-TAB key, to move back up,one field at a time.
As the cursor is positioned within each field, the help message on the Status Line will instruct you on what type of information should be entered to the particular field.
Warning: If you have chosen the Delete option it is important to remember that only Asset Classes that contain no Asset Records can be removed from the Register. If you attempt to erase an Asset Class that currently has Records assigned to it the system will display an error message informing you why the deletion may not proceed.
Two important data fields - Asset Class and Asset NL Account - make up the so-called Class Header,
These two fields are an important part of the Asset record as well as the Asset Class record. The asset class is found at the top of the Asset record screen. The Asset NL account is on the Description tab. The two fields may be defined as follows:
Asset Class: The code that represents the Asset Class. It may
be up to eight alphanumeric characters in length, and is usually an
abbreviated form of the full Class description. The
button is available to aid searching.
For example,L/Mach for Large Machines, F&F for Fixtures and Fittings,Motor for Motor Vehicles, and so forth.
Asset NL Account: The Account Code used for assets within this
Class. The Account Code entered must correspond to an existing
Balance Sheet fixed asset account on the Nominal Ledger. There is a search function on this field. click on the
activate the Search facility and locate the required Account Code by
its corresponding Short Name.
The next data field on the screen holds the complete title of the Asset Class:
Class Description: The full descriptive name of the Asset Class. It may be up thirty alphanumeric characters in length. This field is user-definable.
When creating or amending an Asset Class, you must enter information to both the Asset Class and Asset NL Account fields; otherwise, the system will not allow you to proceed further.
Five data fields enable you to set default values that will appear in the corresponding fields on every Asset Record within the Asset Class.
For example, it may be likely that all assets within a certain Asset Class will have a Straight Line Depreciation Method. If so, you would enter a 1, representing 'Straight Line', to the Depreciation Method field on the Asset Class. Each Asset Record that you subsequently create and define as part of the Asset Class will then show number 1 in its Depreciation Method field on the Asset Valuation page.
The default feature is purely for your convenience; the pre-set values may be overwritten in any particular case by the Add or modify assets option. The four of the five default fields are as follows (the fifth field is the Nominal Account code above):
Lifetime (periods): The expected Lifetime of assets that will be defined as belonging to this Asset Class, expressed in accounting periods.This is user-definable.
Depreciation Method: The Method assigned to calculate the
depreciation on the asset. The value entered here must correspond
with one of the Methods defined with the Depreciation
methods option on the AR System Maintenance Menu. The range of
Depreciation Methods available,[selected by an
button] each represented by a single-digit
number, will vary according to company and installation. Typical
Methods and the number codes that represent them are as allows:
1 - Straight Line
2 - Linear with Year
3 - Reducing Balance
4 - Constant Amount
9 - Maximum in Year
NL Charge Account: This is the Profit & Loss Charge Account Code of the asset on the Nominal Ledger. This is the account charged with each run of the Depreciation option. Click on the ellipses function to activate the Search facility and locate the required Account Code by its corresponding Short Name. On inputting a valid Account Code to this field, the system will respond by displaying the full name of that Nominal Ledger account.
NL Reserve Account: This is the Balance Sheet Reserve Account Code of the asset on the Nominal Ledger. It is the account that is credited with each run of the Depreciation option, to complete the double entry.
Use the
button search facility and locate the
required Account Code by its corresponding Short Name. On inputting a
valid Account Code to this field, the system will respond by
displaying the full name of that Nominal Ledger account.
When creating or amending an Asset Class, you must enter valid information to all four of the above fields; otherwise, the system will not allow you to proceed further.
Note: With the Asset defaults option on the AR System Maintenance Menu you may assign pre-set values that will appear in the data fields of all Asset Records on the Register. These can also be overwritten for any particular Record.
Where there is a difference between pre-set values set up with the Classifications and the Asset defaults options the former overrides the latter.
Two fields are available on the Asset Class screen to identify the Nominal Ledger accounts. These will be used by the system to post financial information resulting from the operation of two options on the Asset Register Menu. These fields are:
NL Asset Sale Suspense: This is the Account Code of the Nominal Ledger account which will be posted with the Net Book Value of the asset when the Disposals program is run.
Depress the
button function to activate the Search
facility and locate the required Account Code by its corresponding
Short Name. On inputting a valid Account Code to this field, the
system will respond by displaying the full name of that Nominal
Ledger account.
Disposal Cost of Sales, and Disposal Sales
These two fields must be populated [although they are hidden on the Create/Display Assets form] , and usually are charged to Profit/Loss Sale of Assets.
Priority to Display and Priority to Edit:
These two fields must be populated to govern at what priority a user can display and edit certain asset classification, for reasons of confidentiality etc.
Low value flag: Is the asset class to be considered for use with low value assets [assets that are of a very low value and hence are treated differently as far as depreciation is concerned.] Note that this flag only has any effect if the Nation flag of the Autoline system as a whole is set to "DE".
Country specific facilitation: For use with asset register companies that use a specific country set-up.
NL Asset Purchase Suspense Account: This is the Account Code of the Nominal Ledger account that will be posted with such asset valuation amendments as result from the running of the Add/modify assets option.
Depress the
button to activate the Search
facility and locate the required Account Code by its corresponding
Short Name. On inputting a valid Account Code to this field, the
system will respond by displaying the full name of that Nominal
Ledger account.
These two fields do not actually appear on the Asset Records that are included within any Asset Class. Neither are they included among the asset defaults as, unlike the NL Reserve and Charge Accounts, they may not be altered for individual Records. Once specified, they govern the postings from all Asset Records within the Asset Class.
Note: When creating or amending an Asset Class, you must enter valid information to the two Suspense Account fields; otherwise, the system will 'bleep' and not allow you to proceed further.
Depreciation Rates [Percentage and Reduction]: The default Depreciation Method chosen for the Asset Class determines whether it is necessary to input figures to the five Annual Percentage Rate fields and to the Annual Reduction Rate field. If they are required for the Asset Class, enter the appropriate percentages and the rate. An explanation regarding the use of the rates follows:
Annual percentage rates: The fields to be entered on the asset classes are designed to give the depreciation, for example where equal amounts were depreciated each period representing a total straight line percentage for each year allowing different percentages each year (hence the title "Linear within year (an. rate)"), normally running for 4 years. Some motor vehicles would be an example of the use of this method.
Annual reduction rate: Is designed to adjust the slope of the exponential curve given by the formula in depreciation method 3. In effect, how much does the depreciation alter each year .
After you have finished working with the Asset class records click the Exit button or press ESC to return to the assets menu.
If you have made any changes to a record you want to keep you will have to save the record before exiting. When in amend mode you click on the Save button to do this. If you are creating new classes then you will need to click on the Create button after each one you that you create.
Asset Classes enable you to combine individual assets of a common type into a single category. You can then assign certain features to the category, which will determine how the system handles individual assets within it. The option for creating, amending, displaying and deleting Asset Classes is Classifications.
In particular, you can specify the Nominal Ledger accounts that will be posted following usage of the depreciation and Add or modify assets options.
Also, you can assign default values to four of the data fields. These are Lifetime, Depreciation Method, NL Charge Account and NL Reserve Account, which along with the Nominal Ledger account appear on the Record of all assets within the Class. These default values override any which may have been set up for the four fields with the Asset defaults option.
They in turn may be overwritten (except for the Nominal Ledger account) for any particular Record with the Add or modify assets option. Where the default Depreciation Method for the Asset Class requires the entry of up to five Annual Percentage Rates and an Annual Reduction Rate, these too may be set for the Asset Class.
Asset Classes must be set up on the Register before any Asset Records can be created, as each Record must be allocated to a particular Asset Class. Every Asset Class has a unique identifying Asset Class code, this along with Asset NL Account; these will appear on the Header of every Record within the Asset Class.
Note: The Classifications option may be used to delete an Asset Class from the Register only if that Class has no Records currently assigned to it.
BUTTONS
Exit: Returns you to the main menu.
Help: Displays help on the current application using the default browser.
Ad-hoc: Allows an ad-hoc report to be run on the classifications file.
Tip: Click on Grid button to view the form in Grid format.
Create/Exit:
Depending on whether a project is going to be created or deleted, these buttons can be used.
