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AM02.1 - Methods
Use Methods (AM02.1) to define the methods that asset books use for
calculating depreciation, replacement cost, and insurance values. Lawson
provides
six standard depreciation methods and lets you define your own as well.
If you select the Straight Line (SL) depreciation optimizing method,
you must indicate the Straight Line calculation. If you leave this field
blank,
the default calculation is used. See More Help for calculation options.
Methods can calculate depreciation in one of three ways: compute statements,
annual percent tables, or units of production (UOP) tables (annual or by
period).
**Processing Effect
- If your method uses a compute statement, you can also select
an optimization method. The Asset Management system will switch to the
optimization
method whenever it is advantageous to the company, if the book that uses the
principal method is defined with the Method Switch field set to Yes.
- If your method uses a UOP annual table, you must enter actual
UOPs at the end of each year. The system uses the actual UOPs for its
calculations.
If the asset life is more than 13 years, you must continue defining the method
on the UOP Table Yr 14-26 form tab. The system keeps track of the total
estimate
units.
- For each year that you define on the UOP Table form tabs,
you can choose the Periods button to define depreciation calculations by
period.
**More Information
If you select the straight-line depreciation method, you must select
one of the following calculations to derive the depreciation values:
- `blank', Default: If you leave this field blank, when the
SL value calculated using current remaining values exceeds the value
calculated
by the current method, AM switches to using the depreciation method of
calculation.
The actual calculation shall use the SL value calculated based on remaining
asset values.
- O, Original: An `O' indicates that the switch occurs when
the SL value determined from original asset values exceeds the value
calculated
by the current method. The actual SL calculation shall use this original SL
value to continue depreciating the asset.
- M, Mixed: An `M' indicates that the switch occurs when the
SL value determined from original asset values exceeds the value calculated
by the current method. The actual SL calculation shall then be based on
straight
line calculations using current remaining values.
- N, not applicable: An `N' indicates that the SL Classification
field is not applicable to the method switch.
Once this method is created and assets have begun depreciation, you
should not modified the SL Classification selection. If the SL classification
flag is modified while assets are past the optimization switch point,
depreciation
amounts would be affected.
Updated Files
AMCOMPUTE -
AMMETHOD -
AMTABLEPCT -
AMUOPPDS -
Referenced Files
AMDICT -
AM02.2 - Units of Production Table Periods
Use U O P Table Periods (AM02.2) to maintain estimated and actual units
of production by period. You can define up to 55 periods, divided into three
sections. You can define depreciation calculations by period for each year
that you define on the UOP Table form tabs on Methods (AM02.1).
**Processing Effect
UOP depreciation calculations by period let you choose one of three
period conventions:
- If you select Actuals or Estimate (AE), the system calculates
depreciation using the actual number of units produced for the period over
the blended number of actual and estimated units produced in its lifetime.
- If you select Actuals Only (AO), the system calculates depreciation
using the actual number of units produced for the period over the total number
of units the asset is estimated to produce in its lifetime.
- If you select Estimates Only (EO), the system calculates depreciation
using the estimated number of units produced for the period over the total
number of units the asset is estimated to produce in its lifetime.
Updated Files
AMCOMPUTE -
AMMETHOD -
AMTABLEPCT -
AMUOPPDS -
Referenced Files
AMDICT -
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