Changing Useful life of an asset

[former_member1231565]

Hi Experts,

I have an asset whose life will end in Dec 2016 but my client want it to be fully depreciated by march 2016.

I heard from some one that if we change the useful life in P1 of any fiscal year , the depreciation amount will be equally calculated as per the useful life.

Is that correct??

My question is if I need to fully depreciate the asset by March, how much do i need to enter in useful life column, is it  3 months  or 1 year 3 months (as this asset capitalized in Dec 2014).

I do not have ERS & ERQ access to test also I am not able to change the useful life in production as the 2015 table are still not closed.

Your help is highly appreciated.

Thanks

Praveen

[Former Member]

Hi,

According to me if you have purchased asset in Dec 2014 and you want the asset to be fully depreciated then you have to maintain 1 years and 3 months as useful life of asset. Also please note that the Asset Value will be come nil only if the depreciation key assigned is LINR or other depreciation key based on LINR which means the depreciation will be calculated on the base of useful life and not on any percentage. Also in T-Code AW01N- Asset Explorer, there is a simulation button :

By activating this Simulation Mode you can make changes in the Parameters and you can check by making changes in the Useful life and then different options can be checked. But once testing is done please come out from screen and don't save the same.

Regards,

Malhar.

[Former Member]

Hello Praveen,

You calculate the useful life from the depreciation start date (you do not enter just the useful life for the current year). So 1 year 3 months in your case.

Regards, Michael

[former_member1231565]

Hi Michael,

Thank for your reply. I will try once the FY year close issue is fixed.

Regards

Praveen

[ajaycwa1981]

Hi Praveen

You have multiple options

1) Change useful life as 1 Yr and 3 months as said above

2) Simply Charge Unplanned Dep (ABAA) in March and charge off the whole NBV as depreciation

Also, you must not have Smoothing Indicator turned ON in OAYR, as you want the Dep Charge to end by March 2016

Regards

Ajay M