on 04-09-2013 5:06 PM
Hi All Experts,
I have query regarding Low Value Asset class ( India ) . Why do we define LVA asset class in AA ? What is the legal requirement behind this ? I tried searching Google but failed.
So can anyone please guide me !
Regards,
Sharvari Joshi.
Hi Joshi,
The deparment of company affairs-India ,issued notification during 1993 Dec,which has
inserted as Schedule XIV note No.8 to companies act 1956 about depreciation on low value
assets.Example :- Actual cost doesn't exceed INR 5000.00 shall be provided 100% dep.with
in fiscal year. According to Schedule XIV ,the individual items of fixed assets whose actual
value doesn't exceed INR 5000.00 ,shall be charged depreciation@ 100%.
For more information.Please read to AS 14.
Regards
Mani
You must be a registered user to add a comment. If you've already registered, sign in. Otherwise, register and sign in.
Hi All Experts,
Thank you for replying and providing a true guidance.
Thanks Mani, by providing reference from Indian scenario for which I was looking.
Appreciating your help.
Regards,
Sharvari Joshi.
You must be a registered user to add a comment. If you've already registered, sign in. Otherwise, register and sign in.
Hi Sharvari,
Low Value Assets is an asset class defined in SAP where all values equal to or less than 5000 (For India) will be booked. You can figure out with client as to, in which asset class they expect to have purchases amounting to Rs. 5000 or less and in all those Asset classes, you can have LVA asset class also.
In LVA Asset class, 100% amount will be depreciated in the first depreciation run itself. and the amount of Rs. 5000 is specified in configuration. Node is Asset Accounting> Valuation>Amount Specifications>Specify max amount for LVA.
BR, Sakshi
You must be a registered user to add a comment. If you've already registered, sign in. Otherwise, register and sign in.
Hi Sharvari
This is mainly required for consolidation purposes.
For instance, As per US GAAP, all assets related expenses below 5000 USD are required to be posted into expenses accounts.
Similarly, as per EMEA GAAP, all assets related expenses below 2000 USD should be expensed off.
Assume if the consolidation happens in US, then you need to show the EMEA assets above 2000 USD also as expense as per US GAAP. Hence, we need to adopt different practices in leading and non-leading ledgers.
This is just one scenario which I know. Better to discuss with business and get the exact requirements.
Hope this helps.
Regards
Srini
You must be a registered user to add a comment. If you've already registered, sign in. Otherwise, register and sign in.
Hi Joshi,
Low Value Assets are assets with low values and the benchmark has been decided by Client that for example below $500 amount all assets should come in the category of LVA.
Like Tea Machines, Chillers and Kitchen Items usually comes in LVAs. Its not a legal requirement it is solely depends upon your client's requirement.
Regards,
Zain Bashir.
You must be a registered user to add a comment. If you've already registered, sign in. Otherwise, register and sign in.
User | Count |
---|---|
91 | |
11 | |
10 | |
6 | |
5 | |
5 | |
5 | |
3 | |
3 | |
3 |
You must be a registered user to add a comment. If you've already registered, sign in. Otherwise, register and sign in.