Fixed Asset has Negative Accumulated Depreciation


You may discover that an asset has a negative accumulated depreciation value. As the depreciation is subtracted from the asset's value to calculate the current net value, the asset has a greater value than initially introduced; for example: Cost = 3310.00 / NBV = 11112.08 / LTD DEPN = -7802.08.

You may be wondering why this occurred and how to resolve it.


The most likely cause for this issue is that an adjustment was introduced to the asset's depreciation value, setting it to a negative number. The depreciation has continued past its normal course because the net value is still positive. The adjustment can be undone via Fixed Assets > FA Transaction Entry Menu > Trans Process Reverse.

Depending on the settings, a GL posting entry may be generated that one wishes to avoid. This can be manually reversed in General Ledger >GL Transaction Processing > On Line Transaction Entry.

For detailed instructions on using the Trans Process Reverse function, please refer to chapter 4.14 of the FA Operations Guide. For detailed instructions on using the On Line Transaction Entry function, refer to chapter 6.1 of the same guide.



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