Hi All,
I am new to ASSET ACCOUNTING. I need your assistance on the following business scenario requirement from our business.
Account #1404000 for Machinery needs to be the beginning of the year amount. We need to have Account #14040001 activated to act as the adjustment account for any additions and 14040002 activated to act as the account to record the disposal amount.
14040000 - Beginning Year Balance
14040001 - Machinery Adjustments(Any additions) throughout the year.
14040002 - Disposals(Retirement of Assets) throughout the year.
Account #14780000 for Machinery Accumulated Depreciation needs to be the beginning of the year amount. We need to have Account #14780001 to act as the adjustments account to record accoumulated depreciation throughout the year.
14780000 - Beginning of Year Balance
14780001 - Adjustments Account to record depreciation throughout the year.
Once these accounts are setup, we will need to have the ability or need direction on how to reclass the balance in the adjustments accounts (14780001) to the beginning of the year accounts (14780000) which will happen at the beginning of each new year.
Also, once the Accumulated Depreciation accounts are added we will need to change the posting of the automatic process that is run each month. This process creates and posts the new depreciation amount each month. The current month accumulated depreciation will need to go to the Accumulated Adjustment account instead of the current account that is getting used.
The reasoning for the need to add this accounts is for mapping into BPC as we need to split out the accounts between Opening balance and Current Year adjustments. Right now this process is very manual since all transactions are in one account. The is also a requirement for Corporate IFRS reporting in that we have to identify current activity with prior year activity.
Do provide your suggestion, on how to achieve it.
Do revert.
Regards,
Gibson.