Internal Training Oracle Asset (FA) December 5TH, 2009 Iwan Herdian Iwan.Herdian@metrodata.co.id Heryasin T Heryasin.Tedjawardana@metrodata.co.id

Agenda Other Miscellaneous Information – Accounting Process

Current and Prior Period Addition The recoverable cost is $4,000 and the method is straight-line 4 years. You purchase and place the asset into service in Year 1, Quarter 1.

Continued You place an asset in service in Year 1, Quarter 1, but you do not enter it into Oracle Assets until Year 2, Quarter 2. Your payables system creates the same journal entries to asset clearing and accounts payable liability as for a current period addition.

Merge Mass Additions When you merge two mass additions, Oracle Assets adds the asset cost of the mass addition that you are merging to the asset account of the mass addition you are merging into. Oracle Assets records the merge when you perform the transaction. Oracle Assets does not change the asset clearing account journal entries it creates for each line, so each of the appropriate clearing accounts clears separately.

Construction-In-Process (CIP) Addition You add a CIP asset. (CIP assets do not depreciate)

Deleted Mass Additions Oracle Assets creates no journal entries for deleted mass additions and does not clear the asset clearing accounts credited by accounts payable. You clear the accounts by either reversing the invoice in your payables system, or creating manual journal entries in your general ledger.

Capitalization A capitalization transaction is similar to an addition transaction: you place the asset in service so you can begin depreciating it. When you capitalize an asset in the period you added it, Oracle Assets creates the following journal entries:

Continued When you capitalize an asset in a period after the period you added it, Oracle Assets creates journal entries that transfer the cost from the CIP cost account to the asset cost account. The clearing account has already been cleared.

Asset Type Adjustments If you change the asset type from capitalized to CIP, Oracle Assets creates journal entries to debit the CIP cost account and credit the asset clearing account. Oracle Assets does not create capitalization or reverse capitalization journal entries for CIP reverse transactions.

Cost Adjustments to Assets You place an asset in service in Year 1, Quarter 1. The recoverable cost is $4,000. The life of your asset is 4 years, and you are using straight-line depreciation. In Year 1, Quarter 4, you receive an additional invoice for the asset and change the recoverable cost to $4,800.

Continued Expensed Amortized

Cost Adjustment by Adding a Mass Addition to an Existing Asset Oracle Assets creates the following journal entries for a capitalized $2,000 mass addition added to a new, manually added $500 asset, where the asset uses the category of the mass addition:

Asset Depreciation in Corporate Book and Tax Book Oracle Assets creates the following journal entries for a current period depreciation charge of $200:

Retirements Current Period Retirements You place an asset in service in Year 1, Quarter 1. The asset cost is $4,000, the life is 4 years, and you are using straight-line depreciation. In Year 3, Quarter 3, you sell the asset for $2,000. The cost to remove the asset is $500. The asset uses a retirement convention and depreciation method which take depreciation in the period of retirement.

Continued If you enter the same account for each gain and loss account, Oracle Assets creates a single journal entry for the net gain or loss.

Continued

Reinstatement Current Period Reinstatement

Transfer Asset In Year 2, Quarter 2, you transfer the asset from cost center 100 to cost center 200 in the current period.

Continued In Year 3, Quarter 4, you transfer the asset from the ABC Manufacturing Company to the XYZ Distribution Company.

Continued you place the same $4,000 asset in service with two units assigned to cost center 100. In Year 2, Quarter 3, you realize the asset actually has four units, two of which belong to cost center 200. If all units remain in the original cost center, Oracle Assets does not create any journal entries.

Reclassification You reclassify an asset from office equipment to computers in Year 1, Quarter 3. The asset cost is $4,000, the life is 4 years, and you are using straight-line depreciation.

Continued