Introduction to configuring the default depreciation book
Fixed assets functionality in Business Central provides an overview of your fixed assets and ensures correct periodic depreciation. It also enables you to keep track of maintenance costs, manage insurance policies, post fixed asset transactions, and generate various reports and statistics about your fixed assets.
For each fixed asset, you need to set up a card that contains information about the asset. You can set up buildings or production equipment as a main asset with a component list, and you can group them in various ways, such as by class, department, or location. Then, you can begin to acquire, maintain, and sell fixed assets that you no longer need. Additionally, you can set up budgeted assets. This feature makes it possible to include anticipated acquisitions and sales in reports.
To keep track of fixed asset depreciations and other financial transactions that are related to fixed assets, you can set up one or more depreciation books for each fixed asset in your company. Depreciation is done by running a report to calculate periodic depreciation and fill in a journal with the resulting entries that are ready to be posted. Dynamics 365 Business Central supports several depreciation methods, which are set up in depreciation books. Multiple depreciation books are allowed for each fixed asset that can be used for different purposes, such as one for tax reporting and another for internal financial reporting.
Each fixed asset can be attached to one or more insurance policies. You can verify that insurance policy amounts are in accordance with the value of the assets that are linked to the policy, which helps make it easier to monitor annual insurance premiums.
Before you start setting up assets, it's a good idea to complete some setup pages, including the Fixed Asset Setup page. This page is used to select the default settings that you want to use for managing your fixed assets.
To access the Fixed Asset Setup page, select the Search for page icon in the upper-right corner of the page, enter fixed assets setup, and then select the related link.
The Default Depr. Book field contains the default depreciation book. You can enter one of the depreciation book codes in this field. The default depreciation book is automatically suggested on journal lines, sales lines, purchase lines, and batch jobs such as Calculate Depreciation. If you have a default depreciation book assigned in the setup, it doesn't prevent you from creating multiple depreciation books.
If the asset is one main asset that consists of multiple component assets, you can select whether you want to be able to post only to the components or to the main asset as well. Turn on the Allow Posting to Main Assets option to post transactions to a main asset.
Use the Allow FA Posting From and Allow FA Posting To fields if you want to restrict posting to fixed assets from a certain date, to a certain date, or in a specific time interval, for example, to restrict posting to the fixed assets within the current year or any previous period. If you leave these fields empty, no time restriction is applied to posting transactions to fixed assets.
If your configuration includes insurance facilities, enter a code in the Insurance Depr. Book field to enable posting of insurance coverage ledger entries.
If the Automatic Insurance Posting toggle is turned on, Business Central allows for the acquisition costs that are posted to fixed assets to automatically post to the insurance coverage ledger.