Disposing of an Asset

Whether an asset is lost, destroyed, sold, or entered by mistake, we recommend that you dispose of the asset instead of deleting it or canceling it.

When you dispose of an asset that has an accounting book with depreciation schedules, future depreciation schedule messages are no longer sent to the accounting system. In addition, the asset value and depreciation of that asset is cleared from the accounting system and an audit trail is retained. If you are generating or exporting a depreciation schedule associated with this asset, wait for the process to complete before disposing of the asset.

When you dispose of an asset, its depreciation is calculated based on the accumulated depreciation until the disposal date.

When an asset is disposed of part way through a month, quarter, or year:

  • The depreciation schedule for that month, quarter, or year is terminated.
  • A depreciation schedule is created for the part of the month, quarter, or year up to the disposal date.

An exception to this is a MACRS tax book which abides by the MACRS convention to calculate the final period's depreciation schedule. For more information about MACRS tax books, see About MACRS Depreciation.

Schedules that fall on or after the disposal date are terminated, however past schedules or any part period schedules are not terminated.

Schedules that fall before the disposal date might be recalculated if they are for a part period, for instance, not for a full month, quarter, or year.

For an accounting book, the part period depreciation schedule is sent to the accounting system.

Depreciation schedules for tax, MACRS tax, and custom depreciation books are not sent to the accounting system.

If an asset has been disposed of successfully, Fixed Asset Management automatically creates a new disposal journal. The journal's description uses the existing asset's description preceded by Asset Disposal:.

To dispose of an asset:

  1. Click the Fixed Assets tab.
  2. Search for the fixed asset that you want to dispose of.
  3. Click the name of the fixed asset that you want to dispose of.
  4. If you have not already done so, specify the additional asset disposal information:
    1. Click Edit.
    2. [Optional] Select the reason the asset was disposed of from the Method of Disposal drop-down list.
    3. Enter the date on which the asset was disposed of in the Disposal Date field.
    4. Enter the amount the asset was sold, salvaged or transferred for in the Disposal Value field.
    5. [Optional] Complete the remaining Asset Disposal fields. See Asset Disposal.
    6. Click Save.
  5. Click Dispose.
  6. Click Yes.
Note:
  • Depreciation schedules that fall after the disposal date are terminated.
  • If the asset has any depreciation schedules with the status "Pending" that fall before the disposal date, you must export them manually. They are not exported automatically by the disposal process.
  • If an asset is disposed of part way through a year, this might result in part of that year remaining in a depreciation schedule.
  • The Disposal Value amount is not used when calculating the disposal value in the related disposal journal. When you dispose of an asset, its depreciation is calculated based on the accumulated depreciation until the disposal date.