Depreciation

Depreciation spreads an asset's cost across its working life, so the register shows what things are worth now rather than what they cost when new.

Fisetra handles this in three parts, under Depreciation in the sidebar:

Screen	Purpose
Depreciation Settings	Company-wide rules
Depreciation Template	Reusable rule sets applied to assets
Depreciation Report	Calculated results by period

What depreciation reads from an asset

Before any of this works, the asset's Purchase tab must be complete:

Field	Role
Acquisition value	What is being depreciated
Depreciation start date	When it begins — often later than the purchase date
Useful life	Over how long
Residual value	What remains at the end

An asset missing these will not depreciate. That is the most common cause of a blank depreciation figure. See Managing assets.

Depreciation Settings

Requires the capability to view or update depreciation configuration.

Settings apply company-wide and decide how calculations behave.

Depreciation type

Fisetra distinguishes Fiscal from Commercial depreciation, so the same asset can be depreciated one way for tax purposes and another for management reporting.

If your organisation does not make that distinction, use one and be consistent.

Rounding

Setting	Effect
Rounding rule	How fractional amounts are rounded: banker's rounding, half up, always up, always down
Decimal adjustment	Where the accumulated rounding difference is absorbed — in December, or at end of life

Rounding sounds trivial and is not. Over a long life, a fraction of a currency unit per month accumulates, and the adjustment rule decides where that lands. Match it to what your accountants expect.

Depreciation Template

A template is a reusable set of depreciation rules applied to many assets, so a policy is defined once rather than per asset.

Methods

Method	How it behaves	Suits
Straight-line	The same amount every period	Assets that wear evenly — furniture, buildings
Declining balance	A percentage of the remaining value, so more early and less later	Assets that lose value fastest when new — vehicles, IT equipment

Straight-line

Depreciation per year = (Acquisition value − Residual value) ÷ Useful life
Book value            = Acquisition value − Accumulated depreciation

Declining balance

Depreciation = Book value at start of period × Declining factor
Book value   = Book value at start of period − Depreciation

Because it applies a percentage to a shrinking balance, declining balance never quite reaches zero on its own. The declining balance policy decides how it ends:

Policy	Effect
Switch to straight-line	Switches method partway so the asset finishes cleanly
Force residual at end	Forces the final value to the residual value
No adjustment	Leaves it as the formula produces

Residual value

Residual value is set either as a percentage of the acquisition value or as a fixed amount. Percentage suits a policy applied across a class of assets; fixed suits a known resale value.

Creating a template

1. Open Depreciation → Depreciation Template.
2. Select the create option.
3. Give it a name and code.
4. Choose the method, the default useful life and the residual value.
5. For declining balance, set the factor and the end policy.
6. Save.

Templates can be assigned to many assets at once, which is far quicker than setting each asset individually.

Running a calculation

1. Create a period
2. Preview the result
3. Run the calculation
4. Review the report

1. Open Depreciation → Depreciation Report.
2. Create a period — the month or year to calculate.
3. Preview the calculation to see the figures before committing them.
4. Run it. Fisetra calculates each eligible asset and records the charge and the new book value.
5. Large calculations run in the background.

Preview first. It is much easier to spot a wrong template before the numbers are written than to explain them afterwards.

The report

The report shows, per period and per asset, the depreciation charged, the accumulated total and the current book value, filterable by period, category, location and department, and exportable — see Reports.

Each asset also has its own Depreciation tab showing only its own figures.

Depreciation and other transactions

Event	Effect
Disposal	Depreciation stops. The last depreciation date on the document decides where
Reverse disposal	Depreciation resumes — review the dates afterwards
Capitalization	Later periods use the higher value and any extended life. Earlier periods are not recalculated
Asset changes on purchase values	Changes the basis from that point on

Common problems

Problem	Why	What to do
An asset shows no depreciation	Purchase fields incomplete, no template assigned, or the start date is in the future	Check the asset's Purchase tab, then its template
Figures differ from your own calculation	Rounding rule, residual type or method differs from your assumption	Compare against Depreciation Settings and the template
Declining balance never reaches residual	That is how the method behaves	Set an end policy on the template
A disposed asset is still depreciating	The last depreciation date on the disposal was set later than expected	Check the disposal document
Capitalization did not change past periods	It applies going forward only	Expected
A calculation seems stuck	Large runs are processed in the background	Wait, then refresh; if it never finishes, contact your system administrator