Definition
CAUTION!
The following description does not contain any information on applicable tax law.
For more information on depreciations, please contact your tax advisor or auditor.
Depreciation is a common practice in financial accounting which is used to record and account for the loss in value of fixed assets or current assets. Typically, the purchase price of an asset, e.g., a machine or a license, is allocated evenly over its expected useful life. This way, the loss in value of an asset is reflected in the balance sheet and the accurate calculation of company assets is facilitated.
Typical causes for an asset's loss in value include wear and tear, weathering, technological advancements, or changed legal conditions. Depending on the type of value loss, different depreciation methods are possible. A distinction is also made between scheduled and non-scheduled depreciation.
In TRASER DMS 365, depreciation can be posted either automatically via batch processing or manually via the fixed asset G/L journal. To facilitate correct calculation, the number of depreciation months (based on the expected useful life) can be stored directly in a Service Item model or subcategory.
In addition to the financial depreciation described here, it is also possible to calculate and post calculatory depreciation in TRASER DMS 365.
Read More
Depreciation Methods for Fixed Assets at Microsoft
Depreciation at Wikipedia