Set up depreciation (Russia)
This article explains how to set up depreciation for Russian fixed assets.
Set up depreciation methods
Depreciation methods define the rules for calculating depreciation.
Go to Fixed assets (Russia) > Setup > Depreciation methods.
Select New to create a depreciation method.
In the Depreciation method field, enter the identification code of the depreciation method for the fixed asset. In the Name field, enter the name of the depreciation method.
In the Method field, select the depreciation method:
- Linear − This method is a uniform accrual method. A capital allowance is calculated proportionately for each period or interval that you set up, such as monthly, quarterly, semi-annually, or annually, or for the whole service life of the asset.
- Reducing remainder − This method decreases the depreciation value over the service life of the asset. The depreciation amount is based on the residual value of the fixed asset at the start of the reporting year. The depreciation rate is calculated based on the remaining useful life and the acceleration factor.
- Manual − The depreciation schedule is defined as a percentage value for each period. In this method, you can manually define the depreciation rate for each depreciation period.
- Factor − The depreciation amount is calculated as a remaining amount that is multiplied by a fixed ratio.
- By number of years − The asset value is based on the number of years of useful life that remain.
- Product output/mileage − The asset value is proportionate to the volume of units that are produced or the distance that is traveled.
- Tax nonlinear − The accrued monthly depreciation for the asset is calculated by multiplying its remaining value by the depreciation rate. The depreciation rate is defined as K = (2 ÷ n) × 100 percent, where n is the asset's useful life in months.
- Tax nonlinear group method − The accrued monthly depreciation for the asset group is calculated by multiplying its remaining value by the depreciation rate. The depreciation rate is defined as K = (2 ÷ n) × 100 percent, where n is the asset group's useful life in months.
In the Interval field, select the period that the depreciation must be accrued for. If you select Quarterly, you must enter three monthly transactions instead of a single transaction for the whole quarter.
If you selected Reducing remainder or Factor as the depreciation method, in the Factor field, enter the factor or percentage that must be reduced per interval.
Note
The Factor field is available only if you select Reducing remainder or Factor as the depreciation method.
If you selected Tax nonlinear as the depreciation method, in the Cost limit field, enter the cut-off percentage value. When the accrued depreciation amount is calculated, the depreciation amount for the year is recalculated based on the asset's service life and depreciation profile. The amount is allocated across the specified periods in the year.
If you selected Manual as the depreciation method, on the Action Pane, select Schedule of depreciation to manually create depreciation schedules for fixed assets.
Note
The Schedule of depreciation button is available only if you select Manual as the depreciation method.
Change the depreciation method for tax accounting
Go to Fixed assets (Russia) > Periodic > Changing depreciation method.
In the Changing depreciation method dialog box, in the Year field, specify the year when the new depreciation method goes into effect.
In the Old depreciation profile field, select the depreciation method that was previously used for tax accounting.
In the New depreciation profile field, select the new depreciation method.
On the Records to include FastTab, select Filter to open the Inquiry dialog box, and then enter the criteria that are used to select fixed assets.
Select OK. The Depreciation method field on the General FastTab of the FA value models page is updated with the new depreciation method.
Tip
To open the FA history page to view these changes, go to Fixed assets (Russia) > Common > Fixed assets, select the fixed asset, and then select Value models. Then, on the FA value models page, select FA lifetime history.
Set up analysis codes for fixed asset depreciation
Analysis codes are used to calculate the depreciation accrual for a fixed asset. You can set up an annual depreciation rate that is applied to fixed assets or to a depreciation group.
Go to Fixed assets (Russia) > Setup > Analysis codes.
Select New to create an analysis code.
In the Analysis code field, enter the analysis code. In the Name field, enter a description of the analysis code.
In the Depreciation group field, select a depreciation group.
In the Depreciation type field, select the depreciation type:
- From cost − The analysis code is applied to all fixed assets except vehicular fixed assets.
- On 1000 km mileage − The analysis code is applied to vehicular fixed assets.
On the Lines FastTab, select Add to create a line.
In the Start date field, specify the date when the depreciation rate becomes active.
In the Depreciation rate field, enter the annual depreciation rate as a percentage.
In the Factor field, enter the factor that the specified depreciation rate is increased or decreased by, relative to the fixed value that is defined by the Russian Federation legislation for a fixed asset group.
Set up depreciation groups
By defining depreciation groups for fixed asset value models, you can specify asset details that are generated when a fixed asset is depreciated. These details include the depreciation profile, service life, and deferral parameters.
If a fixed asset is registered after it's put into operation, depreciation is calculated from the first day of the month of registration. If a fixed asset is registered before it's put into operation, depreciation is calculated from the first day of the month after the fixed asset is put into operation.
Go to Fixed assets (Russia) > Setup > Depreciation groups.
In the Value model field, select the value model that you're creating a depreciation group for.
Select New to create a depreciation group.
In the Depreciation group field, enter the depreciation group code. In the Name field, enter the name of the depreciation group.
In the Depreciation method field, select a depreciation method for the depreciation group.
On the General FastTab, in the Lifetime field, enter the maximum service life, in years, that depreciation is accrued for the fixed assets in the depreciation group.
If you selected Reducing remainder as the depreciation method, in the Minimal depreciation field, enter the minimum depreciation amount.
In the Depreciation start date field, select the type of start date for depreciation:
- From month when put into operation – Depreciation is calculated from the first day of the month when the fixed asset is put into operation after acquisition.
- Next month start – Depreciation is calculated from the month after the fixed asset is put into operation after acquisition.
- Next quarter start – Depreciation is calculated from the quarter after the fixed asset is put into operation after acquisition.
- Next half year start – Depreciation is calculated from the half-year after the fixed asset is put into operation after acquisition.
- Next year start – Depreciation is calculated from the year after the fixed asset is put into operation after acquisition.
- Date of the registration – Depreciation is calculated from the date of registration.
Note
Starting in Finance version 10.0.24, you can select the From date when put into operation value in the Depreciation start date field. If this value is selected, the system calculates the depreciation from the date of putting into operation and completes the depreciation on the date of disposal.
In the Depreciation bonus field, enter the maximum depreciation bonus percentage. The Depreciation bonus percentage that is selected in the Putting into operation transaction can't exceed this value.
On the Deferrals FastTab, in the field above the grid, select Disposal to set up the parameters that are used to create deferrals on the disposal of fixed assets that accrue a loss. Select Partial dismantlement to set up the parameters that are used create deferrals on the partial write-off of fixed assets that accrue a loss.
Note
When you create a transaction for the disposal or partial write-off of a fixed asset, if the transaction causes a loss, the transaction details are posted to a deferral account. This account contains the values of the calculated loss and the write-off time. The write-off time is calculated by using the fixed asset depreciation factor and the difference between the useful life of the depreciated asset and the actual amount of time that the asset was used before disposal.
Select Add to create a line.
In the Model number field, select the model number of the deferral.
In the Deferrals group field, select the deferrals group for deferred expenses.
In the Expense code field, select the expense code for deferrals.