Depreciation Postings

(Accountant Plus and Financial Controller users only)

It is very important to note that this Fixed Assets option posts depreciation postings only. It is assumed that you have already entered the book value of each of your fixed assets directly into your nominal ledger as balance sheet accounts.

For existing assets these values should have been entered as part of your opening balances. For assets you have bought since entering your opening balances the cost price should have been assigned to the appropriate nominal ledger asset account when you recorded the receipt of the supplier invoice or as a direct bank payment if you did not use a supplier.

These postings are actually made using the Sage Line 50 Month End option. The postings will only be made once in any calendar month. If however, you forget to post depreciation during a month, the system will only post this for you if you change the Sage Line 50 program date to a date that falls within the month you missed.

For example, if you are in July and forgot to post JuneÆs depreciation values. When you post the July depreciation, JuneÆs depreciation will not also be posted. To post JuneÆs depreciation you need to change the Sage Line 50 program date to a date in June then run the month end. Do not forget to change the date back!

At the end of every month, through the Month End option, you can ask Sage Line 50 to make the monthly depreciation postings automatically for you.

The postings made are as follows (no VAT is involved):

$image\bullet.gif$ The Profit & Loss nominal ledger expense account defined in each asset record (DepÆn P&L N/C) is increased by the monthly depreciation amount (debit posting).

$image\bullet.gif$ The balance sheet fixed asset depreciation account defined in each asset record (DepÆn BS N/C) is increased by the monthly depreciation amount (credit posting). The transactions will appear as JCÆs and JDÆs (Journal debits and credits) on the audit trail and be given the reference, "DEPREC" automatically for you. No VAT is involved and these transactions do not need to be reconciled with any bank.