This information describes how Fixed assets integrates with General ledger, Inventory management, Accounts receivable, and Accounts payable. You also can set up Fixed assets to integrate with purchase orders.
Within General ledger, the value of all fixed assets is usually summarized on a few ledger accounts that are necessary for financial reporting. In the form, however, you can create hundreds of fixed assets records to include an acquisition price, depreciation, and valuation. Each time you post a transaction for a fixed asset, the appropriate general ledger accounts are updated. The ledger accounts for fixed assets always show the updated value of fixed assets.
In the form, you define the ledger accounts that fixed asset value model transactions are posted to, and you also specify the type of fixed asset transactions that are posted to each ledger account. You can create various combinations of fixed asset ledger accounts, depending on the level of detail that you want for fixed assets in the general ledger. Ledger accounts can be based on transaction types, value modes, and ledger accounts.
Depreciation books do not affect General ledger. They are only used for tax and other asset reporting.
You can enter the acquisition of fixed assets that the company has produced or constructed for itself in the fixed assets inventory journal, and then transfer inventory items from inventory to fixed assets as an acquisition or a part of an acquisition.
You also can acquire assets using purchase orders. When purchase orders contain inventory items that are designated as fixed assets, the field in the form determines whether an acquisition is posted for the fixed asset when the invoice is posted. The way in which the acquisition of fixed assets influences inventory depends on the company setup.
When an inventory item becomes a fixed asset acquisition, either through the inventory journal, a purchase order, or an acquisition proposal, a fixed asset value model acquisition transaction is created. If a value model acquisition includes a derived depreciation book, a depreciation book acquisition transaction also will be created.
The decrease from the inventory when an acquisition is posted is controlled by the posting rules that are set up in the form in Inventory management. However, you do not always decrease inventory when you post invoices related to fixed assets. In some cases, the fixed assets might be purchased for internal use, such as a laptop purchased for the Sales department. When you work with purchase orders, you can use items that are set up for both resale and internal use.
If you use specific receipt and issue accounts for fixed assets on item groups, you can use the same inventory item for both internal purchases and stock for resale.
When fixed assets are for internal use, they are set up with an account type of to track the receipt of the fixed asset. Use this account when you post a purchase invoice if the invoice line contains an existing fixed asset for internal purposes, or if the invoice line has the check box selected. This account is typically an expense account. You can set up the account type for either an item group or individual item ( tab in the or forms).
Similarly, when fixed assets are for internal use, you can set up an account type of to track issuing the fixed asset to the recipient. The fixed asset issue account serves as the offset to the fixed asset debit account when an asset is acquired using a purchase order. The asset acquisition can be posted when you post a purchase invoice or when you post it in the journal, possibly by using an acquisition proposal. You can set up the account type for either an item group or individual item ( tab in the or forms).
Ultimately, the ledger accounts used for posting are determined by the ledger integration options on the inventory model group and whether an asset is assigned to the purchase order line. The accounts are derived from the posting profile for each item group. The only variation occurs if you enter a specific receipt account on the purchase order line details.
During packing slip posting, if an inventory reservation exists, you cannot assign a fixed asset or create a fixed asset from the line.
The accounts that fixed asset transactions are posted to depend on whether assets are purchased or constructed by the company, and also the transaction type of the asset.
The transaction type connects the inventory transaction to the posting profile in Fixed assets. Because the posting profile in Fixed assets defines which accounts are going to be updated, the selection of a fixed asset transaction type is indirectly also a selection of the ledger accounts that the transaction will be posted to. For both constructed and purchased fixed assets, the transaction type will usually be or .
An important issue for integrating Fixed assets and Inventory management is the setup and use of inventory items that will be designated as fixed assets. Like any other user working with purchase orders, a user working with the purchase of fixed assets must understand the setup and purpose of the and forms. The most important issues that are related to these inventory forms are described in Set up fixed assets inventory items.
Accounts receivable is updated when you sell a fixed asset to a customer and create an invoice for the sale.
Like the integration to Accounts payable, the integration of Fixed assets to Accounts receivable uses posting profiles that are set up in Fixed assets and activated when a fixed asset, value model, and fixed asset transaction type are selected for a sales invoice prior to posting. Because fixed assets are not a part of Inventory management, you must use the form when you sell a fixed asset.
If the value model includes a derived depreciation book, a depreciation book transaction will be created when you post the customer invoice.
Fixed assets are usually acquired from external vendors. You can use the form to specify whether asset acquisitions always are posted when you post vendor invoices, or whether asset acquisitions can be posted only from Fixed assets. If you allow posting from Accounts payable, fixed asset accounts are updated whenever a vendor invoice for a fixed asset acquisition is posted.
If you are set up to post an asset acquisition when a packing slip or invoice is posted, the transaction is posted according to the posting profiles in Fixed assets for the various fixed asset transaction types. The posting is controlled by the fixed asset, value model, and fixed asset transaction type that are selected in the form prior to posting the vendor invoice.
If the value model includes a derived depreciation book, a depreciation book transaction will be created when you post the vendor invoice.
The integration is activated on the tab in the form for each order line for a fixed asset. You can send a purchase requisition for a fixed asset to the vendor, but the fixed assets and general ledger accounts are updated only when you post the vendor invoice or an acquisition proposal, which usually is created from the purchase invoice only after the fixed asset is received. Because purchase orders can contain only inventory items, the acquisition of fixed assets influences inventory according to the company setup.
You can associate a project with an asset that is affected by the project. You also can associate each phase, task, or subproject to a different asset. One asset per record is allowed, and you create the association when you enter a fixed asset number in the field in the form.
You also can use the form to view details about assets that are associated with projects:
To view details about the asset that is associated with the parent project, display the parent project and then clear the check box. When you view the tab in the lower pane, details about the asset are displayed, if you have associated an asset with the project.
To view details about all assets that are associated with the parent project and any subprojects, display the parent project and then select the check box. When you view the tab in the lower pane, details about all assets are displayed, if you have associated any assets with the projects or subprojects.
To view the fixed asset record, click the button on the tab to open the form. Click to view the projects that are associated with the fixed asset.
You typically associate fixed assets with projects when the projects are related to work, maintenance, or improvements for the asset. When the project is complete, no write up adjustment for the asset is created automatically, so you must create this manually, if necessary.
To delete an association between a project and asset, clear the field in the form.
You also can identify a fixed asset that you are creating or manufacturing as part of an estimate project. At the end of an estimate project, you can automatically post an asset acquisition transaction. For more information, see About estimate projects.