Currently the assets are depreciated on straight line basis on net book value for remaining useful life of the assets.
We are following SORP requirements in UK for revaluation.
Asset is purchased on 01.04.2009 for 120000. Current Values as well as Historic costs are 120000. (Gross Book Value)
Life time of the asset is 10 Years (120 Months). The depreciation planned for each month is 1000.
Now the asset is revalued below historic cost on 02.04.2009 at 100000. As per SORP requirement, if the asset is revalued below historic cost, then over and above the historic cost, must be posted as unplanned depreciation. We have posted the revaluation of 20000 by using AB01 as unplanned depreciation. We have posted this as unplanned depreciation, but NOT as revaluation, because of SORP requirement.
Currently the system is still calculating the depreciation of 1000 GBP per month.
Whereas client expects the depreciation of 833 per month. (100000 GBP / 120 months)
How can the system calculate the depreciation at 833 GBP instead of 1000 GBP per month. This problem only happens when I post a transaction as unplanned depreciaation.
Any valuable inputs will be highly appreciated.
Thanks in advance.