Add an investment to an asset
You can change the value of an asset within the depreciation period. You might do this, for example, if the value of an asset is revised upwards or if an asset suddenly decreases in value because of the emergence of more advanced equipment. Changes in the purchase value result in additional depreciation period amounts that start from the last finalised depreciation period.
You can view the investment lines with the purchase value and add or delete new investments on the Investment tab in the asset properties.
You can add changes (investments) using the New button. Use the Properties button to view investment lines and to adjust the last line. You can delete the lines (except for the initial line) provided they have not been journalised. The first line in the ‘Investments’ view is the initial purchase value. You cannot delete this even if it has not yet been journalised: at least 1 line must be present. You can only change the initial purchase value if you undo the journalising for this asset.
Both methods are explained using an example.
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Add a investment to an asset (revaluation)
If an asset gets a higher value, you can add an extra investment. You can also add a negative investment if the value of an asset decreases. You can only revalue a main asset or a non-linked asset.
To add an investment to an asset (revaluation):
- Enter the invoice or credit invoice of the investment or disinvestment in the purchase journal in the usual way.
For the entry on the balance sheet account, you do not add a new asset. It is not possible to add the invoice to an existing asset during the entry. From the assets view or in the properties of the asset itself, you can submit a dossier item and record the PDF of the invoice.
- Go to: Financial / Fixed assets / Asset.
- Open the asset properties.
- Go to the tab: Dossier if you want to record the PDF of the invoice.
You add a new dossier item. In order to be able to record a dossier item on an asset, you need to configure the Asset destination for the dossier item type in question.
- Go to the tab: Investment.
- Click on: New.
- Enter the description.
- Select a value for Calculation type.
- Select With retroactive effect from start of depreciation if you want to revalue an asset before the first depreciation period, for example to show the value increase as a result of a renovation.
- Enter a value in Purchase date.
This date must be later than the last depreciation period.
- Enter the value increase in Purchase value.
For a value reduction, you enter a negative amount. However, the asset sale book value may not become negative as a result of this. Otherwise you would get negative depreciation period amounts. The negative investment may not be more than the current asset sale book value. For example: a negative investment with a purchase value of -1,000 is not allowed if the asset sale book value is 950.00.
Note:
When an investment is added, Profit checks if the asset sale book value becomes negative and a negative depreciation/calculation basis is created. If this is the case then Profit displays a blocking message.
- If required, enter a value for Additional costs.
- Complete the fields for Invoice details. A direct entry for a new asset from the purchase journal automatically links the purchase invoice.
- Click on: Finish.
Profit recalculates the future depreciation period amounts. The already journalised period amounts are not recalculated.
Change the purchase value of an asset after journalisation
After you have depreciated an asset, it is no longer possible to correct the purchase value, unless you undo the journalising made for this asset.
To change a purchase value:
- Go to: Financial / Fixed assets / Asset.
- Select the asset.
- Click on the action: Undoing journalizing.
With this, you delete the journalising for all periods up to and including the depreciation start date.
- Open the asset properties.
- Go to the tab: Investment.
- Open the properties of the investment.
- Enter a value in Purchase value.
- Click on: OK.
- Go to the tab: Depreciate fiscally.
- If required, enter a value for Previous asset reinv. reserve.
The calculation of the depreciation amount per period now takes account of the modified amounts.
To generate journal entries again:
- Go to: Financial / Fixed assets / Journalise.
- Generate the journal entries for the periods for which the depreciation was already finalised.
Examples of calculation type when changing the purchase price of an asset
You can change the purchase value of an asset using one of the following methods:
- Method T – Retrospectively from the start of the depreciation
- Method D – Starting from the change date
Below you can read how this works for the depreciation method 'Linear percentage'.
Method T – Retrospectively from the start of the depreciation
This method distributes the amount of the change across all the depreciation periods in the complete term. The journalising is as follows:
- Already journalised periods remain unchanged.
- Because of the changed amounts the additional journal entries come in the next period that has not yet been journalised.
- The remaining periods contain the complete new period amount.
Example:
Asset purchase value: € 60,000.00
Term: 5 years / 60 periods
Depreciation method: Linear percentage
Year
Period
Calculation basis
Kind of depreciation
Depreciation period
Depreciation until current year
Total depreciation
Book value asset sale
2014
1
60,000
Basis
1,000
0
1,000
59,000
2014
2
60,000
Basis
1,000
0
2,000
58,000
2014
3
60,000
Basis
1,000
0
3,000
57,000
2014
4
60,000
Basis
1,000
0
4,000
56,000
2014
5
60,000
Basis
1,000
0
5,000
55,000
2014
6
60,000
Basis
1,000
0
6,000
54,000
Periods 1 - 6 have been journalised.
In period 7, a change in the purchase value takes place as from the change date.
Amount of change € 6000.00
The change date is day 1 of period 7
The periodic depreciation should really have been 1,100 (€ 66,000 / 60). Now, 6 x 1,000 has been depreciated which is 600.00 too little. Profit corrects this in the next period to be journalised. This amount of € 600.00 is thus included in the depreciation period amount (€ 600 + € 1,100) = € 1,700.
Year
Per.
Calculation basis
Kind of depreciation
Depreciation period
Depreciation until current year
Total depreciation
Book value asset sale
2014
7
66,000
Basis
1,700
7,700
7,700
58,300
2014
8
66,000
Basis
1,100
8,800
8,800
57,200
2014
9
66,000
Basis
1,100
9,900
9,900
56,100
etc.
etc.
etc.
etc.
etc.
etc.
etc.
2018
12
66,000
Basis
1,100
13,200
66,000
0
Method D – Starting from the change date.
- The change date is later than the end date of the last journalised period.
- This method distributes the amount of the change across the depreciation periods from the change date until the end of the term.
- The recalculated period amounts contain the complete new period amount.
Example:
Asset purchase value: € 60,000.00
Term: 5 years / 60 periods
Depreciation method: Linear percentage
Year
Period
Calculation basis
Kind of depreciation
Depreciation period
Depreciation until current year
Total depreciation
Book value asset sale
2014
1
60,000
Basis
1,000
0
1,000
59,000
2014
2
60,000
Basis
1,000
0
2,000
58,000
2014
3
60,000
Basis
1,000
0
3,000
57,000
2014
4
60,000
Basis
1,000
0
4,000
56,000
2014
5
60,000
Basis
1,000
0
5,000
55,000
2014
6
60,000
Basis
1,000
0
6,000
54,000
Periods 1 - 6 have been journalised.
In period 7 a change in the purchase value takes place as from the change date. This amount is calculated for the remaining still to be journalised periods and then these newly calculated period amounts are accumulated with those already present.
Amount of change € 6,000.00
The change date is day 1 of period 7
Number of period amounts remaining € 60.00 - 6.00 = € 54.00.
Calculation of period amounts € 6,000.00 / 54 = € 111.11
Year
Period
Calculation basis
Kind of depreciation
Depreciation period
Depreciation until current year
Total depreciation
Book value asset sale
2014
7
66,000
Basis
1,111.11
7,111.11
7,111.11
58,888.89
2014
8
66,000
Basis
1,111.11
8,822.22
8,222.22
57,777.78
2014
9
66,000
Basis
1,111.11
9,333.33
9,333.33
56,666.67
etc.
etc.
etc.
etc.
etc.
etc.
etc.
2018
12
66,000
Basis
1,111.11
13,333.32
66,000
0
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