Group Deprn White Paper PDF

ORACLE APPLICATIONS
WHITE PAPER
Group Depreciation
Prepared by
Author: Anshu Malhotra Fixed Asset Support
Updated by: Kathy White -- Fixed Asset
Support
Creation Date: 01-Mar-2006
Last Updated: 10-Nov-2011
Control Number: 1
Version: 2
Copyright (C) 1995 Oracle Corporation
All Rights Reserved
Product Design and Architecture
Group Depreciation White Paper Ver 1.0
Table of Content
1
SCOPE............................................................................................................................. .............. 4
INTRODUCTION ........................................................................................................................ . 5
A GLOBAL PERSPECTIVE ..................................................................................... ................... 6

3.1
3.2
3.3
3.4
3.5
CANADA ............................................................................................................................. . 6
INDIA ................................................................................... ................................................ 8
JAPAN ............................................................................................................................. ..... 9
UNITED KINGDOM ........................................................................................................... 11
UNITED STATES .............................................................................................................. . 12
OVERVIEW............................................................................................................................... . 14
SETUP ............................................................................................................................. ............ 16

5.1
5.2
5.3
GROUP ASSET SET UP AT BOOK CONTROLS LEVEL FOR CORPORATE BOOK.............................. 16

GROUP ASSET SET UP AT BOOK CONTROLS LEVEL FOR TAX BOOK. ........................................ 18
GROUP ASSET SET UP ON ASSET CATEGORIES ........................................................................ 20
CREATION OF A GROUP ASSET .......................................................................................... . 21
6.1
A. GROUP ASSET ADDITION VIA DETAIL ADDITION ON ASSET WORKBENCH .............................. 24
6.1.1
Depreciation Tab: Method. ............................................................................................. . 24
6.1.2
Depreciation Tab: Depreciation limit............................................................................... 24
6.1.2.1
6.1.2.2
6.1.3
Advanced rules tab: Retirement options. .......................................................................... 27
6.1.3.1
6.1.3.2
6.1.4
Over depreciate.....................................................................................................................24
Super Group .........................................................................................................................25
Retirement options: Recognize gain and loss..........................................................................28
Retirement options: Terminal gain and loss............................................................................34
Advanced rules tab: Tracking options .............................................................................. 35
6.1.4.1
6.1.4.2
Allocate Group Amount ........................................................................................................ 36

Calculate Member Asset Amount ..........................................................................................39
6.1.5
Advanced rules: Reduction rules ..................................................................................... .41
6.2
GROUP ASSET ADDITION VIA QUICK ADDITIONS ON ASSET WORKBENCH ...............................43
6.3
GROUP ASSET ADDITION VIA PREPARE MASS ADDITIONS ......................................................45
6.4
GROUP ASSET ADDITION VIA WEB ADI ................................................................................ .45
7
MEMBER ASSET ADDITION ................................................................................................. . 46

7.1
7.2
7.3
7.4
7.5
7.6
MEMBER ASSET ADDITION VIA DETAIL ADDITION ON ASSET WORKBENCH ............................... 46

MEMBER ASSET ADDITION VIA QUICK ADDITIONS ON ASSET WORKBENCH ............................ 48
MEMBER ASSET ADDITION: CATEGORY ................................................................................ . 49
MEMBER ASSET ADDITION VIA PREPARE MASS ADDITIONS.................................................... 50
MEMBER ASSET ADDITION VIA APPLICATION DESKTOP INTEGRATOR (ADI) ........................... 50
MEMBER ASSET ADDITION VIA WEB ADI .............................................................................. 50
DISABLING GROUP ASSETS .................................................................................................. 50
QUERYING A GROUP ASSET ON THE ASSET WORKBENCH OR INQUIRY FORMS... 52
10
ONE TIME ENTRY AND UPDATABLE PARAMETERS ....................................................... 55
10.1
10.2
11
GROUP ASSET ...................................................................................................................... . 55

MEMBER ASSET .................................................................................................................... 58
ASSIGNING MEMBER ASSET COST TO THE GROUP ....................................................... 60
11.1
11.2
11.3
CURRENT PERIOD MEMBER ADDITION .................................................................................... 60

PRIOR PERIOD MEMBER ADDITION .......................................................................................... 62
FUTURE PERIOD MEMBER ASSET ADDITION ........................................................................... 66
11.4
12
ADDING A GROUP OR A MEMBER ASSET WITH RESERVE ........................................... 67

12.1
12.2
13
CIP MEMBER ASSET ADDITION ............................................................................................ . 66
ADDING A GROUP ASSET WITH RESERVE ................................................................................. 67

MEMBER ASSET ADDITION WITH RESERVE ............................................................................. 67
DEPRECIATION........................................................................................................................ 67
13.1
GROUP DEPRECIATION WITHOUT MEMBER TRACKING OPTION. ................................................ 70
13.2
GROUP DEPRECIATION WITH MEMBER TRACKING OPTION........................................................ 70
13.2.1
Allocate group amount ............................................................................................... . 73
13.2.1.1
13.2.1.2
13.2.1.3
13.2.2
13.2.2.1
13.2.2.2
Allocate Group Amount with Distribute Excess .....................................................................73

Allocate group amount with reduce excess.............................................................................77
Allocate Group amount with Allocate to fully retired and reserved Assets...............................81
Calculate member amount.......................................................................................... . 81

Calculate Member amount with sum Member Asset Depreciation to Group disabled. ..............81
Calculate Member amount with sum Member Asset Depreciation to Group enabled................83
13.3
DEPRECIATION LIMIT ............................................................................................................ 86
13.4
OVER DEPRECIATE ............................................................................................................... . 90
13.5
DEPRECIATION OVERRIDE ..................................................................................................... 91
13.5.1
Allocate group amount ............................................................................................... . 91
13.5.1.1
13.5.1.2
Group amount override .........................................................................................................91

Member amount override ...................................................................................................... 93
13.5.2
Calculate member Asset amount ................................................................................. . 94
13.6
UNPLANNED DEPRECIATION ................................................................................................. . 95
13.6.1
Allocate group amounts.............................................................................................. . 95
13.6.1.1
13.6.1.2
13.6.2
14
Unplanned depreciation performed at group level...................................................................95

Unplanned depreciation performed at Member level...............................................................97
Calculate member amount.......................................................................................... 102
JOURNAL ENTRIES FOR GROUP ASSETS..........................................................................104

14.1
14.2
DEPRECIATION OVERRIDE .................................................................................................... 107

UNPLANNED DEPRECIATION .................................................................................................109
15
REPORTS113
15
SUMMARY ...................................................................................................................... ..........114

15.1
16
GROUP DEPRECIATION RULES.............................................................................................. 116
APPENDICES ................................................................................................... .........................116

16.1
APPENDIX 1: HOW TO READ THE GROUP AND MEMBER ASSET TRACES? .................................116
16.2
APPENDIX 2: NEW T ABLES CREATED FOR GROUP ASSET........................................................118
SCOPE
This paper is intended for an audience familiar with Oracle Fixed Assets and seeking an
insight into how the new functionality of Group Depreciation introduced from Patchset
11i.FA.M is built to cover the statutory requirement in many countries of maintaining
assets in a Group.
This paper is functional in nature keeping in sight Oracles existing literature that has
adequate details on the technical aspect of the Oracle Fixed Assets, though adequate
insight is given to the table level details relevant to the topic. This is more so, in the light
of the Asset trace being available as a concurrent program, thus making table level details
easily accessible to the user. Thus we have tried to handle the topic from the available
functionality as well as the data perspective level.
To prevent this document from becoming too bulky, and also to maintain focus
throughout the paper, the scope of this paper is limited to the basic set up need for adding
group assets, factors to be kept in mind while adding a group asset as well as its member
assets and the various factors that affect the depreciation calculation for a Group asset as
well as its member asset. However, this paper does not handle how various transactions
performed on the group assets (like cost adjustment, group reclassification, retirements
and group adjustments) are treated and how they affect depreciation calculations for the
group as well as its member assets. It is assumed that the audiences are aware of the
basics of fixed assets, as only the behavior peculiar to group assets is handled in the
paper.
This document is intended to be supplementary in nature and does not in any way,
purport to be a substitute for any official literature being drafted or currently published.
INTRODUCTION
Group Depreciation was first developed by Oracle Capital Resource Logistics (CRL) to
provide an Asset Management Solution to meet the financial accounting needs of the
communications industry in the United States. Communications companies typically own
and maintain a large network infrastructure enabling them to offer communication
services to their many customers. These networks consist of many individual pieces of
equipment, such as routers, switches, cables, transmitters, etc. The large volume of assets
require pooling of similar assets into groups to ease reporting. This logical pooling of
asset is referred to as GROUP ASSETS.
Group assets reduce data entry substantially as the member assets default the
depreciation rules from the group assets. The group asset cost is equal to the sum of
member asset cost. A Group may contain a number of assets with different date placed
in service but depreciation expense goes to only one account maintained at the Group
asset level. A member asset can be moved in and out of a group and between groups.
This is called Group Reclassification. Retirement may only be performed on a member
asset. It is optional to recognize gain or loss on retirement of an asset. You can
postpone the recognition till the time the last member of the group asset is retired.
Depreciation can also be tracked at the member asset level for Reporting and auditing
purpose.
Due to globalization, most multinational companies need to satisfy multiple tax
regulations across geographical boundaries. In many countries it is required to depreciate
their assets in Groups rather than as individual assets. For example the Indian
Block of asset where similar assets as defined in the tax regulations, are grouped and
then depreciated. Group depreciation caters to many of these regulatory requirements,
thus facilitating companies to meet global regulatory requirements.
A GLOBAL PERSPECTIVE
In many countries, Accounting Principles and Tax regulations require depreciation to be

calculated and reported by Group of Assets. Group Asset allows the companies to meet
the global regulatory requirement needs. Examples of business requirements for some
countries are provided in the following section. This is not designed to be a complete
review, just examples.
3.1 CANADA
Under the Canadian Income Tax System, expenditure of a capital nature is generally not
deductible from the income in the year they are incurred. Instead capital expenditures are
deducted over several years. These annual charges to income are known as the Capital
Cost Allowance commonly referred to as CCA.
CCA requires that similar assets as defined in the tax regulations be grouped in CCA
Classes. CCA requires depreciation to be calculated and tracked at the group asset level
only.
An asset becomes available for use at the earlier of, the year it begins being used by the
taxpayer and the first taxation year that begins more than 357 days after the year in which
asset is acquired (available for in use). When the asset becomes available for use, it
should belong to the regular grouping and should start being depreciated. This implies
that in Canada, assets at CIP status can be depreciated as a part of the Group. Each cost
Addition to the CIP asset automatically becomes available for depreciation. It starts
depreciating in the second year of after the year of acquisition or in the year it begins
being used which ever is earlier. Thus controlling the depreciation start date for each cost
adjustment. Refer to Group Asset Set up at Book Controls level for Corporate Book.
The table below lists some of the requirements of CCA and how they are met by Group
asset.
Table 1: Requirement for CANADA
Regulatory Requirement
How Group Asset meets these requirements?
Assets classified under respective Add a group asset and add member assets to it. The
grouping prescribed by law
group asset cost is the sum of its member asset cost.
The member asset inherits the depreciation rules
entered at the Group asset level.
Depreciation to be tracked only Depreciation is calculated and tracked at the group
for the Group.
asset level. Do not enable member tracking at book
level.
Group depreciation is required The group asset must exist in the corporate Book to
only for the Tax book.
get copied onto the tax book. Thus Corporate book
must allow group assets also. Refer Group Asset
Set up at Book Controls level for Tax Book.
Add individual asset with reserve Enter a standalone asset with reserve and then
to the group.
reclass it to the Group asset. Direct addition of a
member asset with reserve is not allowed. Refer to
Member asset addition with Reserve
It is not required to claim the

entire calculated depreciation
amount in any given year. Any
amount between Zero and
calculated depreciation could be
claimed in a given year.
User to control treatment of
transferred/retired member asset
from the Group. Remove the
NBV of these member assets
from the group.
Add CIP asset to the group and
depreciate it as part of the group.
Able to control the depreciation
start date for each cost addition to
CIP assets.
Depreciation is calculated as a
percentage of NBV balance at the
end of fiscal year.
Special treatment of asset added
and retired in the fiscal year. 50%
rule on inclusion of incremental
cost in the depreciation basis.
Postponing
recognition
of
Gain/loss on retirement of asset
till the retirement of the last asset
in the Group.
Limit net proceeds of sale to the
cost of the retiring member and/or
to the group NBV.
Group, selected Group assets into

higher-level grouping.
This is done via entering Override depreciation at

the group level. Refer to Depreciation override for
more details.
Select the transfer type ENTER to enter the

amount of reserve/expense to be removed from the
Group while transferring member asset.
Enter the retired reserve while retiring the member
asset.
Enable CIP asset Addition to the Group at Book
level.
Able to depreciate selected Source lines as part of
Group at asset level. Inclusion of any source line in
the depreciation calculation is taken as a current
period adjustment.
Select depreciation basis rule Year end balance
with positive reduction while entering the
depreciation method.
For the group asset, Enter reduction rules as
follows:
Reduction Rate as 50%.
Addition check box :ON
Adjustment check box :ON
Retirement check box :ON
If (Addition plus/minus Adjustments less proceeds
of sale > 0), Then half of such excess amount must
be deducted from the depreciation basis of the
Group. In case this condition is not satisfied than
the rule is ignored. Refer Advanced rules:
Reduction rules and depreciation basis rule white
paper note number 276453.1.
Retirement option defaults as Do not recognize
gain or loss.
Set Terminal gain and loss to be Recognize
Immediately.
Check the Limit Net Proceeds to Cost and
Recapture Excess Reserve checkboxes.
Excess amount of (Net proceeds-less Cost of the
retired Member assets) is booked as gain/loss. And
(Net proceeds less NBV of Group) recaptured for
the group to bring NBV to 0. Refer Advanced rules
tab: Retirement options.
Maintain Super group to facilitate high-level
grouping. Only flat rate methods can be set for a
Super Group. Refer Super Group for more details

on this.
Note: Net proceeds here refer to sales proceeds less cost of removal.
3.2 INDIA
Group Asset Rules for India are defined in India Tax regulations only. India requires that
similar Assets (as defined in the tax regulations) be grouped together in Block.
Depreciation is calculated and tracked at member level and summed up to the group total.
Reporting is done at group asset only.
The table2 below lists some of the requirements of India and how they are met by Group
asset.
Table 2: Requirement for INDIA
Assets classified under respective Add a group asset and add member assets to it.
The group asset cost is the sum of its member
asset cost. Refer to Advanced rules tab: Tracking
options
Add individual asset with reserve to Enter a standalone asset with reserve and than
the group.
member asset with reserve is not allowed. Refer
to Member asset addition with Reserve
Group depreciation is required only The group asset must exist in the corporate Book
for the Tax book.
to get copied onto the tax book. Thus Corporate
book must allow group assets also. Refer Group
Asset Set up at Book Controls level for Tax
Book.
Depreciation calculated and tracked Enable member asset tracking at Book level.
at Member asset level and summed Choose calculate member asset amount and
check sum member asset to group check box in
up to the group.
the tracking option for the group asset.
User to control treatment of Select the transfer type ENTER To enter the
transferring the member asset out of amount of reserve/expense to be removed from
the Group. Remove the NBV of the Group.
transferred member assets from the
group.
Depreciation is calculated as a Select depreciation basis rule Year end balance
percentage of NBV balance at the end with Half year Rule while entering the
of fiscal year.
depreciation method.
If Date in service of the newly For the group asset, Enter reduction rules as
acquired asset falls in the first half of follows:
the fiscal year, 100% cost included in Reduction Rate as 50%.
the depreciation basis. While if it fall Addition check box :ON
in the second half of the fiscal year, Adjustment check box :OFF
50% cost included in the depreciation Retirement check box :OFF
basis of the Group.

This rules applies only to positive
cost addition.
Postponing recognition of Gain/loss
on retirement of asset till the
retirement of the last asset in the
Group.
Group NBV cannot be negative.
Refer Advanced rules: Reduction rules and

depreciation basis rule white paper note number
276453.1.
Retirement option default to Do not recognize
gain or loss.
Set terminal gain and loss to Recognize
Immediately.
Check Recapture Excess Reserve checkbox.
(Net proceeds less NBV of Group) recaptured for
the group to bring NBV to 0. Refer Advanced
rules tab: Retirement options.
Perform unplanned depreciation at Unplanned depreciation is allowed at member
member asset level.
asset level since member asset tracking is
enabled. Refer Unplanned depreciation.
Allow backdated transaction for the Not possible to enter backdated transactions for
group and/or member asset at the group assets.
book level
3.3 JAPAN
Group depreciation rules for Japan are defined for Financial as well as Tax Regulations.
The assets are grouped together by usage or location. Depreciation is calculated and
reported at the group asset level. However, the group depreciation needs to be allocated
to its member asset for auditing purpose.
The table3 below lists some of the requirements of Japan and how they are met by Group
asset.
Table 3: Requirement for JAPAN

The group asset cost is the sum of its member
asset cost. The member asset inherits the
depreciation rules entered at the Group asset
level.
Add individual asset with reserve to Enter a standalone asset with reserve and than
the group.
member asset with reserve is not allowed. Refer
to Member asset addition with Reserve
Add individual asset with a prior
Enter an asset with any DPIS between the Group
period DPIS.
DPIS and the current period date.
Group depreciation is required only Enable group asset for the tax as well as the
for the Tax as well as fiscal reporting corporate book. Refer Group Asset Set up at
purpose.
Book Controls level for Tax Book.
Depreciation is calculated and
(a) Select Allocate Group Depreciation in the
reported at the Group level. Though
Tracking option for the Group Asset. Do not
depreciation needs to be calculated

and tracked at member asset level as
well, but depreciation methods at
member asset level can be different
than that of the group.
Annual depreciation is calculated as
Aggregate of the period to date
depreciation amount. The period to
date depreciation
amounts
is
calculated as percentage of aggregate
balance of depreciation basis of
member asset at the end of each
period. Thus depreciation can be cost
or NBV based.
Treatment of the fully reserved asset
in depreciation calculation.
When member tracking is enabled:
Cost based Method: fully reserved
member asset to be excluded from the
depreciation calculation.
NBV based Method: fully reserved
member asset should remain included
in the depreciation Calculation.
enable Allocate to fully retired or reserved

assets and check Reduce excess check box.
(b) Select Calculate Member asset amount and
pick member or group depreciation method.
Enable the ability to restrict member

reserve amount to depreciation limit
Depreciation limit can be set at member level

and summed up to the group. Refer Depreciation
Tab: Depreciation limit
Depreciation basis = Cost less salvage value if
depreciation method is Flat rate Cost based.
Select the transfer type ENTER To enter the
amount of reserve/expense to be removed from
the Group.
Enter the retired reserve while retiring the
member asset.
Unplanned depreciation is allowed at member
asset level since member asset tracking is
enabled.
Override allowed on at group asset as well as
Member level. But override cannot be specified
for the group as well as the member in the same
period for allocate group amount. Refer to
Depreciation override for more details.
Retirement option is grayed out with default as
Recognize immediately when retired gain/ loss.
Refer Advanced rules tab: Retirement options.
Enable CIP asset Addition to the Group at Book
level. Refer to Group Asset Set up at Book
Deduction of salvage value from

depreciation basis.
transferred/ retired member asset
from the Group. Remove the NBV of
the transferred assets from the group.
Perform unplanned depreciation at
member asset level.
Override depreciation at the group
level
Gain and loss need to be recognized

on retirement.
Add CIP asset to the group.
Select depreciation basis rule Flat rate

extension while entering the depreciation
method. Refer Advanced rules: Reduction rules
and depreciation basis rule white paper note
number 276453.1.
For the tracking method Calculate Member

Amount. Depreciation basis of fully reserved or
fully retired member assets is excluded from the
depreciation calculation. Refer Advanced rules
tab: Tracking options
10
Controls level for Corporate Book.
3.4
UNITED KINGDOM
Written Down Allowance (WDA) is defined in UK Inland Revenue for corporation tax
purposes. WDA requires that similar assets (as defined in the tax regulation) be grouped
together in Block. Depreciation is calculated and tracked at group asset level only. No
depreciation is calculated or tracked for the Member asset in the group.
The table4 below lists some of the requirements of United Kingdom and how they are
met by Group assets.
Table 4: Requirement for UNITED KINGDOM

The group asset cost is the sum of its member asset
cost. The member asset inherits the depreciation
rules entered at the Group asset level.
Depreciation to be tracked only for Depreciation is calculated and tracked at the group
the Group.
level.
Group depreciation is required only The group asset must exist in the corporate Book
for the Tax book.
to get copied onto the tax book. Thus Corporate
book must allow group assets also. Refer Group
Asset Set up at Book Controls level for Tax Book.
Group, selected Group assets in to Maintain Super group to facilitate high-level
higher-level grouping.
grouping. Only flat rate methods can be set for a
on this.
Postponing recognition of Gain/loss In the retirement Option, select Do not recognize
on retirement of asset till the gain or loss. Set terminal gain and loss to
retirement of the last asset in the Recognize Immediately.
Group.
Check the Limit Net Proceeds To Cost
Limit net proceeds to the cost of the Excess amount of (Net proceeds less Cost of the
retiring member. The group can retired Member assets) booked as gain/loss. Refer
Advanced rules tab: Retirement options.
have a negative NBV.
Depreciation basis calculated as a Select depreciation basis rule Year end balance
percentage of NBV balance at the while entering the depreciation method. Refer
end of fiscal year.
Advanced rules: Reduction rules and depreciation
basis rule white paper note number 276453.1.
User to control treatment of Select the transfer type ENTER and enter the
transferred member asset out of the amount of reserve/expense as zero since the
Group. Remove only the COST of reserve is not to be moved out.
the transferred assets.
11
Note: Net proceeds here refer to sales proceeds only. No cost of removal is adjusted
against reserve.
3.5 UNITED STATES
The group depreciation feature can be used to cater to the needs of the US
telecommunications industry, as one example.
Federal Communications Commission (FCC) for the telecommunication industry
requires similar asset to be grouped together by category.
US Federal Energy Regulatory Committee (FERC) for the Utilities industry requires
similar asset to be grouped together by FERC code. Asset groupings may be further
subdivided by vintage year and location.
Asset depreciation Range (ADR) for Income Tax regulations require similar assets to be
grouped (as defined in the tax code) first in Vintage Accounts by year of acquisition.
Depreciation is calculated and tracked at group level only. No depreciation is to be
calculated or tracked at member level.
The table5 below lists some of the requirements of United States and how they are met
by Group asset.
Table 5: Requirement for UNITED STATES
The group asset cost is the sum of its member asset
cost. The member asset inherits the depreciation
rules entered at the Group asset level.
Add individual asset with a prior
Enter an asset with any DPIS between the Group
period DPIS.
DPIS and the current period date.
Group, selected Group assets into Maintain Super group to facilitate high-level
higher-level grouping based on rate grouping. Only flat rate methods to be set for a
category.
on this.
Depreciation to be tracked only for Depreciation is calculated and tracked at the group
the Group.
level.
Postponing recognition of Gain/loss In the Retirement option select Do not recognize
on retirement of asset till the gain or loss.
retirement of the last asset in the Set terminal gain and loss to Recognize
Group. And limit the proceeds to Immediately.
the cost of the retiring member Check Limit Net Proceeds to Cost check box.
asset cost. Though the NBV of the Excess amount of (net proceeds less Cost of the
group can be negative.
retired member asset) booked as gain/loss. Refer
Advanced rules tab: Retirement options.
For retirements with gain and loss While performing a retirement on a member asset,
to be recognized immediately on do not enter the reserve retired; the cost and
retirement, remove the cost and reserve of the retiring asset will be removed from
reserve of the retiring asset from the the Group.
12
group.
transferred member asset out of the
Group.
Transfer of group reserve between
groups without transferring any
member asset.
Depreciation projections
Select the transfer type ENTER and enter the

amount of reserve/expense to be transferred out.
Use the Reserve transfer button on the asset
workbench to transfer the reserve between groups.
What-IF analysis can be used for group

depreciation projections.
Future period asset transaction
Future transaction like depreciation rate change or
salvage value change is not possible.
Adjustments
resulting
from All adjustment are amortized, expensed
Changes to the assets are amortized adjustments are not possible for Group asset.
over the remaining periods.
Use Half year prorate convention
Prorate conventions are not relevant for group
assets.
Change the depreciation rate for a Depreciation rate change is treated as a current
group and backdate the change To a period adjustment only.
prior period.
Additional opportunities for Group Depreciation use in the US include industries regulated
by the Federal Energy Regulatory Commission (FERC). For those industries, it is common
to see member tracking enabled as Allocate with Distribute Excess. An extension of that is
the use of Units of Production depreciation with Energy Period End Balance depreciation
basis rule for businesses in extractive industries such as oil & gas or mining.
13
OVERVIEW
Group asset is a collection of Individual Assets or Member assets.
Group Asset
Member Asset
Cost = 100
Cost = 300
Member Asset
Member Asset
Cost = 100
Cost = 100
Group Assets cost is the aggregate of its Member Assets cost. Depreciation rules
defined at the Group asset level supersede the rules defined at member asset level.
This has only one exception, when member tracking option is enabled, and set to
Calculate Member Asset Amount with Sum Member Asset Depreciation To Group is
enabled. Depreciation start date is the group Assets date placed in service. A member
asset can be added with any date placed in service between the group asset date placed in
service and current period date.
A group asset has to be of the asset type GROUP while member assets can either of the
assets type Capitalize or CIP. All adjustments to the group or its member asset are
amortized adjustment only.
Member asset can be moved in and out of the Group and between Groups. This is Group
Reclassification. There are two transfer types of group reclassification.
1. Calculate: System will calculate the group reclassification based on the Group
amortization start date entered.
2. Enter: The user is required to enter reserve and/or expense amount to be
transferred. System will process group reclassification using manually entered
amounts.
Note: Enter can only be used if member asset tracking is disabled.
Only member asset can be retired, as the Group Asset does not have a cost of its own. But
the Retirement options are set at the Group asset level only and apply to all its members.
There are two types of rules for group assets retirement.
1. Do Not Recognize Gain and Loss at the time of retirement. The proceeds of sale
cost of removal and retired cost is adjusted with the Group reserve. And no gain
and loss is booked for asset.
2. Recognize Gain and Loss at the time of retiring a Member asset.
After retiring the last asset in the group, the remaining reserve will be booked as the
Terminal Gain and Loss.
14
Depreciation is calculated and tracked at Group asset level, but for reporting and auditing
purposes Member Asset tracking may also be enabled. There are two options for
member asset tracking:
1. Allocate Group amount: The group depreciation amount is allocated based on
depreciation basis of member asset. Reduce Excess, Distribute Excess, or Allocate
to Fully Reserved and Retired Assets can be checked to facilitate treatment of
excess depreciation which would have been allocated to a fully reserved asset
had it not been fully reserved. Only one option can be taken.
2. Calculate member asset amount: Member asset amount is calculated based on the
group or member depreciation method. And the depreciation can be summed up
to the group level also. The Group as well as member asset depreciation are
calculated.
15
5
5.1
SETUP
Group Asset Set up at Book Controls level for Corporate Book.
To be able to add a group asset in a book, the Allow Group Depreciation Flag must be
checked for the book. This flag can be updated at any point of time after the creation of
the Book.
Allow Amortized Change checkbox must also be enabled. This is because every
addition or adjustment to the group or the member asset is an Amortized adjustment.
Thus the book should have Allow Amortized Changes to have group asset added to this
book.
The rest of the boxes are on need basis. Revaluation cannot be performed on a group or
its member asset. Add a standalone asset on which revaluation has been performed
cannot become a member of a group asset.
Allow CIP Member in Group Assets

To Allow CIP member asset in a Group check the Allow CIP Member in Group Assets
checkbox. This will allow CIP member asset to the group though the cost of the CIP asset
will not be included in the depreciation calculation for the Group asset until the CIP asset
is capitalized.
16
Allow CIP Depreciation in Group Assets

In Canada tax regulations, CIP asset may be added to a Group asset and depreciated as
part of the Group asset cost. To Allow depreciation of CIP asset as a part of the group
asset cost check the Allow CIP Depreciation in Group Asset. This just enables the
functionality. This would not make all CIP assets to be depreciated.
In fact when a CIP asset is ready for depreciation, user can select the applicable source
line(s) and check the Depreciate in Group Asset flag on the source lines form.
The selected Source line cost will be included in the Group asset cost and the group
assets depreciable basis. System will default this transaction as a current period amortize
adjustment, however user may optionally enter any amortization start date from the
current period to the CIP member assets Date placed in service. Change of any attributes
in the source line is not allowed when Depreciate in Group asset flag is updated.
17
Allow Member Asset Tracking

The depreciation is calculated and tracked at Group asset level but for reporting and
auditing purpose depreciation may need to be tracked at member asset level also. To
allow Member asset tracking for the Book check Allow Member Asset Tracking.
Allow Intercompany Member asset Assignments
Check Allow Intercompany Member asset Assignments if member assets are required
to have different balancing segments than the balancing segment value of the Group
Asset. Intercompany journal entries will be create to balance the balancing segment
within a single journal entry batch posted to GL. If the flag is not set, the member asset
must have the same balancing segment as the group asset.
5.2
Group Asset Set up at Book Controls level for Tax Book.
To be able to create group asset in the Tax book, the Allow Group Depreciation Flag
must be checked. The four flags explained in the previous section, function the same as
for the corporate book.
Mass copy allows copy of assets and transaction from the Corporate book to the Tax
book. Group asset and its member assignments can also be copied from the Corporate
book to the tax book. A Group Asset must exist in the corporate book before it can be
added to the tax book. Thus if the requirement is to have group asset only in the tax book,
group asset will need to be added in the Corporate book first.
Mass Copy does not copy an type of group adjustment, including group reserve transfer,
group retirement adjustments, and group unplanned depreciation.
Allow mass copy
Allow mass copy enables mass copy for the tax book. Copy addition, Copy adjustment,
Copy retirements, Salvage value, last period dictate mass copy of individual and member
assets from the Corporate book to the Tax book.
These setup options do not apply to a Group asset. Member Asset will be copied as stand
alone asset to the Tax book. Members Group asset assignments to the group will only be
copied based on the setup in the group rules.
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Group Rules-Group Addition

Group asset addition dictates mass copying of a group asset Addition from the Corporate
to tax book. There are two values: Copy and Do Not Copy. The default value is Do Not
Copy
Copy: Addition of a group asset is copied from the corporate book to tax book. The
category must exist in the corporate and tax books for copying the group asset onto the
Tax book.
Do Not Copy: Group asset is not copied from the corporate to the tax book. The member
asset will be added as a standalone asset in the tax book. The group asset will not exist in
the tax book unless manually adding the group asset in the Tax book via Asset
workbench.
Group Rules- Member Asset Assignments

Group Asset Assignments dictates mass copying members Group Asset assignments
from the Corporate to Tax book. Otherwise, Member assets are copied as a standalone
asset from the corporate book to tax book. The group asset must exist in both the
corporate and tax book when copying member assets group membership.
There are two values: Copy and Do Not Copy. The default value is Do Not Copy.
Copy: The same Group membership will be copied to the tax book. This option
supersedes the default Group assignments on the tax book category default.
Do Not Copy: Assets will be added to the default group asset in the tax book category
defaults. If there is no default group in the tax book category default, the member asset
will be added as a standalone asset in the tax book. This standalone asset can be
reclassified to a group asset later.
19
For example let us take a Group asset GROUP A that has two members MEMA and
MEMB. Let us see what will be copied in the following table:
Scenario Group asset
addition
A
Copy
Member asset
assignment
Copy
Group asset
in Tax book
GROUP A
Do Not Copy Copy
None
Copy
Group A
Do Not Copy Do Not Copy
Do Not Copy
None
MEMBER asset in the

tax book
MEMA and MEMB added
to GROUP A
None
MEMA and MEMB will
be added to the group
based on group asset in
the tax book category
defaults
None
In the scenarios B and D the MEMA and MEMB will be copied as a standalone asset
in the tax book.
Group Rules- Group Change
Group Asset Group Change dictates mass copying member reclasses into/out of Group
Assets from the Corporate to Tax book. All group assets involved in any reclass must
exist in both the corporate and tax book when copying member asset reclasses.
There are two values: Copy and Do Not Copy. The default value is Do Not Copy.
Copy: The Group membership reclassification will be copied to the tax book.
Do Not Copy: Reclassifications to/from Group Assets for any members will not be copied to
the tax book.
5.3 Group Asset Set up on Asset Categories

As of Release 12, all group variables can be defaulted at the category default level. In
11i, only the group asset assignment itself c a n default at the category level. This
group asset will default for any assets added to this category, implicitly requiring that this
category be only used for Group Depreciation.
The group asset default set in the tax books category default, dictates members Group
Asset assignments for the tax book when Group Rules- Member Asset Assignments is
set to do not copy. This is set in a scenario where the tax book needs to have a different
members Group Asset assignments than the corporate book.
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CREATION OF A GROUP ASSET
A group asset can be added in many ways. Following are the various methods of adding a
Group Asset:
A. Detail Addition on Asset Workbench,
B. Quick addition on Asset workbench.
C. Mass Additions
D. Application desktop integrator.
E. Web ADI
6.1
A. Group asset addition via detail addition on asset workbench
The additions button on the asset workbench can be used for detail addition of a Group
Asset. All the fields on the asset workbench are available for a group asset also. Detailed
descriptions of the exception for a group asset addition are listed below.
21
Asset type
Asset type of Group must be selected when creating a group asset.
22
Parent Asset
A group or its member cannot be assigned a parent or child asset. Thus after selecting
group as the asset type Parent asset field is grayed out.
In physical Inventory
Physical inventory is not allowed for a group asset. Thus after group is selected as the
asset type the In physical inventory check box is unchecked and is non-updatable.
In the books window enter information for the Group Asset.
Certain financial information such as Current cost, Original cost, recoverable cost and
net book value cannot be updated for a group asset. YTD depreciation and
accumulated depreciation can be updated for a group asset in the period of addition
after a member asset is assigned to the group if member tracking is not enabled. More
information will be provided later on converting accumulated depreciation if member
tracking is enabled.
Revaluation ceiling and revaluation reserve cannot be updated for a group.
Revaluation is not available for group assets.
Salvage value
There are two options to calculate salvage value for the group asset:
Percentage: Salvage value will be calculated as percentage of group asset cost.
Group salvage value= Group Asset Cost* salvage value percentage.
Sum of member asset: The salvage value will be the total of the salvage value of its
member asset.
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6.1.1 Depreciation Tab: Method.

Depreciation methods
All depreciation methods can be entered for group assets. However, unit of
production method can only be used with ENERGY PERIOD END BALANCE depreciation
basis rule.
Date in service
Date placed in service is used for determining the group depreciation start date. It can be
current period as well as prior period date.
Prorate convention and prorate date
Prorate convention is not used for group or member assets. The depreciation start date is
determined using the group assets Date in service. Prorate convention is for display only.
Amortizations start date and Amortize adjustment checkbox.
Amortization start date defaults to the date in service. All additions or adjustments to the
group are amortized so the amortize adjustment checkbox is always checked and is nonupdatable.
6.1.2 Depreciation Tab: Depreciation limit
Type
There are three depreciation limit options for the group asset:
Null: No depreciation limit is set up for the group asset.
Percentage: Depreciation limit will be calculated as percentage of the group asset cost.
Group asset depreciation limit=Group asset cost* depreciation limit percentage
Sum of member Assets: Group asset depreciation limit is the sum of the member assets
depreciation limit
6.1.2.1 Over depreciate
Over depreciation field allows the group asset to depreciate beyond its cost that is the
group asset reserve may exceed group asset cost.
There are three options available:
Do Not Allow: This is the default option. The group asset will stop depreciating once the
group reserve reaches the group assets recoverable cost. After every transaction on the
group asset a validation will happen to check if the reserve is greater than the cost. And
the transaction that fails this validation will error.
Allow: The group asset depreciation can exceed group asset cost but depreciation will
stop for the group asset when the accumulated depreciation is greater than the
recoverable cost unless member tracking is not enabled, in which setup depreciation will
continue regardless.
Allow and depreciate: The Group asset accumulated depreciation may exceed the group
asset recoverable cost, and depreciation will continue for the group assets until the group
asset cost becomes zero.
Note: OverDepreciate will default to No for certain setups and be greyed out. It cannot
be overridden when that occurs.
24
Allow depreciation cannot be set to Allow or Allow and Depreciate if anyone of the
following condition are true:
Depreciation method is calculate, table, formula or Flat-NBV. Though formula
and Flat-NBV are allowed if over depreciate is set to Allow.
Recapture Excess Reserve flag in the retirement option is set to Yes.
Allocate to Fully Retired or Reserved Flag in the tracking option is set toYes.
Depreciation limit is allowed to be set when Over Depreciate is set to Allow or
Allow and Depreciate.
6.1.2.2 Super Group
Super Group is a grouping of group assets.
Super Group
Group A
Group B
Group C
Super group facilitate high level grouping requirement for the telecom industry. The
group asset inherits the depreciation rule from the super group.
Super group is defined at the super group form. From Fixed Asset Manager navigator:
Setup> Depreciation>Super group.
25
Enter the super group name and description. The enabled check box needs to be checked
for active super group. This can be used to deactivate the super group as well. The table
FA_SUPER_GROUPS stores data entered here.
Books and depreciation rule facilitates the attachment of a single super group to many
books. The table FA_SUPER_GROUP_RULES stored the data entered here.
Book
Many corporate and tax books can be attached to the same super group. Thus the super
group can be active in many books together.
Periods from
The range of periods for which the depreciation rules are effective.
Method
Depreciation with flat rate method can be entered for the super group. The methods need
to be picked form the List of values which shows only flat-cost depreciation methods.
Depreciation limit
The depreciation limit percentage needs to be entered for the super group. The
depreciation limit has to be a positive limit and is validated to be anything from zero to
any positive value. The value of the depreciation limit can be greater than 100% percent
for a group asset.
26
A super group can be attached to a group asset in the depreciation limit block on the
books window on the asset workbench.
Super group rules:
To add a super group to a group asset, over depreciate should be Allow or Allow
and Depreciate for the group asset.
One super group can be attached to a number of group assets. This can be done as
a backdated group adjustment as well.
Group assets depreciation will be calculated collectively using the method defined
by the super group, and allocate to each group asset based on the weighted group
cost (each group asset cost/aggregate group asset cost belonging to the same
group asset).
Super group depreciation will be validated against the super group depreciation
limit.
Any change in the depreciation method and depreciation limit for the super group
is processed for the group asset via a concurrent program: Process Super group
change. This change can be identified by the calling interface being FAPSGC and
transaction key as SG in the fa_transaction_headers table for the group asset.
Any change to the depreciation method or depreciation limit for the super group is
treated as a current period transaction for the group asset.
6.1.3 Advanced rules tab: Retirement options.
The retirement rules at the group asset level will apply to all member assets belonging to
such group. Retirement transaction is performed at the member asset only. The retired
member asset will inherit their group assets retirement rules.
Member asset retirement can only be a current period transaction. And retirement prorate
convention is just a display field.
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6.1.3.1 Retirement options: Recognize gain and loss

There are two types of retirement rules regarding recognition of gain and loss for group asset.
1. Immediately when retired.
Gain and loss is recognized at the time of retiring a member asset. Cost and
reserve of the retiring member asset would be removed from the group. Therefore,
retiring member assets reserve must be determined in order to calculate gain and loss.
This is usually proportionate to the retiring member assets cost in the Group.
Retiring member asset reserve = (Member asset cost/ Group asset cost) * Group asset
reserve when member tracking is not enabled. When member tracking is enabled, the
tracked reserve will be used.
The retiring member assets reserve can also be entered manually, if the reserve retired is
required to be a different figure that the proportionate reserve amount and member
tracking is not enabled.
And this reserve will be used to calculate the gain and loss on retirement. In the
retirement form the Retiring reserve amount field can be populated with the
reserve retired. Though the default is the proportionate reserve amount for the retiring
member asset.
28
The retiring reserve entered is restricted to values between Zero and the lesser of the
following: The recoverable cost of the retiring member asset
The reserve of the group Asset.
Though if member asset tracking is enabled, the retiring reserve entered is
restricted to values between zero and retiring member asset reserve amount.
The journal entry that is passed is as follows:

DR
Reserve
(Retiring member assets Reserve) DR
NBV retired
CR
Cost
(Retired member assets Cost) DR
Proceeds clearing
(Proceeds of sale)
CR
Proceeds
(Proceeds of sale) DR
Removal cost
(Cost of Removal)
CR
Removal cost clearing (Cost of Removal)
The gain or loss on retirement is the difference between NBV retired and net
proceeds (proceeds of sale less cost of removal)
2. Do not recognize gain and loss.

In Do Not Recognize gain and loss option, gain and loss is not recognized at
the time of retirement. At Each member asset retirement proceeds of sale, cost of
removal and the retired cost are adjusted with the group reserve. No gain or loss is
recognized.
Group Reserve before member asset retirement.
Add Proceeds of Sale
Less Cost of removal
Less retired cost
----------------------------------------------------- Group
reserve after member asset retirement
-----------------------------------------------------The following journal entry is create for the above:
DR
CR
DR
CR
DR
CR
Proceeds Clearing
Group Reserve
Group Reserve
Cost
Reserve
Removal Cost Clearing
(Sales of Proceeds)
(Sales of Proceeds)
(Retired member asset Cost)
(Retired member asset cost)
(Cost of Removal)
(Cost of Removal)
29
For Example:
Group A
Cost: 100000
Member 1
Cost: 50000
Member 2
Cost: 30000
Member 3
Cost: 20000
The group reserve as on date is 23142.85
Member 1 is retired with:
Proceeds of sale
6000
Cost of removal
1000
23142.85
6000.00
1000.00
Less retired cost
50000.00
-----------------------------------------------------------------------------Group reserve after member asset retirement
-21857.20
------------------------------------------------------------------------------The journal entry passed for the above is as follow:
For Do Not Recognize gain and loss option we have two more options:
a) Limit Net proceeds to Cost
Limit net proceeds to cost flag restricts the proceeds amount for the member
asset to the retiring member assets cost. This flag is only enabled if recognize
gain and loss is set to Do not recognize.
If this flag is set, net proceeds from retirement can be added to the group
reserve until it is equal to the retiring assets adjusted cost any additional
amounts are recognized as gain.
The calculation is as follows:
NBV retired = Net proceeds (Proceeds of Sale less Cost of Removal)
Less Cost.
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The journal entry that is passed is as follows:

DR
CR
DR
CR
CR
DR
CR
Proceeds Clearing
Group Reserve
Group Reserve
Cost
NBV retired
Group Reserve
(Sales of Proceeds)
(Sales of Proceeds)
(Net proceeds in excess of Cost)
(Cost of Removal)
(Cost of Removal)
For Example:
Group A
Cost: 80000
Member 1
Cost: 50000
Member 2
Cost: 30000
Member 1 is retired in the current open period.
Depreciation reserve is 13333.33
Proceeds of sale
55000
Cost of removal
3000
The NBV gain to be booked is calculated as followed:
= Net proceeds (Proceeds of sale less cost of removal) less
cost retired.
= 52000 (55000-3000) -50000
= 2000
Thus since the net proceeds of sale exceed the cost of the asset retired, the
excess amount is booked as a gain or a loss.
The Journal entry will be as follows:
31
b) Recapture Excess Reserve

Recapture Excess Reserve dictates whether a group asset can have a negative
NBV. This flag is enabled for both the retirement options. (Refer Retirement
options: Recognize gain and loss)
If this flag is set and do not recognize is set for retirement option, the
proceeds from retirement can only be added to the group reserve until it is
equal to the group asset cost. Any additional amounts are recognized as gain
or loss. The NBV is reduced to zero and the depreciation stops for the group.
The Recapture Excess flag is updatable only if the over depreciate field is set
to Do Not Allow.
The calculation is as follows for the two retirement options:
b.1. Do Not recognize gain or loss
The group reserve is adjusted with the proceeds of sale, cost of
removal and cost retired.
Less retired cost
----------------------------------------------------Group reserve after member asset retirement
-----------------------------------------------------Recaptured Reserve amount = Group reserve after Retirement
Group cost less Group asset cost
The recaptured amount is booked as NBV retired. And the NBV of
the Group is set to Zero.
32
The journal entry passed for the above is as follows:

DR
Proceeds Clearing
(Sales of Proceeds)
CR
Group Reserve
(Sales of Proceeds)
DR
Group Reserve
CR
Cost
CR
NBV retired
(Recaptured reserve)
DR
Reserve
(Cost of Removal)
CR
(Cost of Removal)
For Example:
Group A
Cost: 35000
Member 1
Cost: 15000
Member 2
Cost: 20000
Member 1 is retired in the current open period.
Depreciation reserve is 5833.33
Proceeds of sale
30000
Cost of removal
500
5833.33
30000.00
500.00
Less retired cost
15000.00
------------------------------------------------------------------------Group reserve after member asset retirement
20333.33
------------------------------------------------------------------------But the group asset cost after retirement is only 20000.
The NBV of the Group after retirement:
= Cost after retirement less group reserve after retirement
= 20000-20333.33
= -333.33
Since the NBV of the group cannot be negative thus 333.33 will be
recaptured and booked as gain or loss.
The Journal entry will be as follows:
33
b.2 Immediately when retired.

While retiring the member asset the Retiring reserve amount is
calculated proportionality for the retiring member asset but this can be
entered manually as well when member tracking is not enabled. In such a
case recapture excess reserve flag checks whether the group asset will
have a negative NBV after retirement. If yes, that excess amount is
recaptured and recognized as the gain or loss in addition to the gain
and loss already recognized.
Recaptured Reserve amount = Group reserve after retirement less
Group cost after retirement
With Do Not Recognize it is common to see a member assets retirement cause the
Group Asset to become overdepreciated, if sufficient reserve is not present to handle
the cost of the group.
Note that when Units of Production depreciation is used, the member retirement
option Do Not Recognize is required. In this case only, when a member is retired
when it is not fully reserved, not only can a group become overdepreciated, but there
is rolldown of that reserve adjustment to the members, and members can themselves
become overdepreciated.
6.1.3.2 Retirement options: Terminal gain and loss
When the last member of the asset is retired from the group the remaining reserve
balance is treated as terminal gain and loss. Terminal gain and loss will recognized only
when group asset cost becomes zero.
There are three methods in recognizing terminal gain and loss.
A. Recognize immediately.
The terminal gain and loss is recognized immediately in the period when it
occurred. That is the terminal gain and loss is recognized on the retirement of the
last member in the group Asset.
34
B. Defer recognition to end of fiscal year

The recognition of terminal gain and loss is postponed to the last period of the
current fiscal year. However, if an asset is added to the group before the end of
the current fiscal year, terminal gain and loss is no longer valid. Therefore, no
terminal gain and loss will be recognized.
C. Do not recognize
Terminal gain and loss will not be recognized. The reserve amount will remain in
the group. Thus this group will have a negative NBV.
6.1.4 Advanced rules tab: Tracking options

Depreciation is usually calculated and tracked at the group asset level. But in some
countries statutory requirement mandate that the depreciation is tracked and/or
calculated as well as tracked at member asset level also. The Member Asset Tracking
feature provides this flexibility.
Member Asset 1
Cost = 10000
Depreciation= 500
Group Asset
Cost = 90000
Depreciation = 4500
Member Asset 2
Member Asset 3
Cost = 20000
Depreciation= 1000
Cost = 60000
Depreciation= 3000
This option will only be available on the asset workbench if Member Asset Tracking is
enabled at the book level. Once enabled, group depreciation amounts will be calculated
and allocated to the member asset according to the rules specified. Thus depreciation
gets calculated at group as well as tracked at member asset level. Member tracking
also applies to unplanned depreciation entered at the Group asset level.
The main advantage of member tracking is that it facilitates member asset depreciation
amounts like member asset reserve which is needed for transaction performed at member
asset level like retirement, reclassification etc.
There are two tracking methods:
a) Allocate Group Amounts.
b) Calculate Member Asset Amounts
35
6.1.4.1 Allocate Group Amount

This method allocates the depreciation calculated for the Group to its member asset
based on depreciation basis of the member asset.
Allocated depreciation amount = (Depreciation basis of a member asset/ Depreciation
Basis of the Group asset)* Group depreciation.
With this tracking method the following options are also used:
Allocate to Fully Retired and Reserved Assets
If the Allocate to Fully Retired or Fully Reserved Assets flag is check the
depreciation will be allocated to the fully retired and fully reserves member
asset also. Thus bypassing all validation done for fully reserved and retired
asset while calculating depreciation. Once this flag is checked the reduce
excess and distribute excess check box are disabled, and cannot be updated.
If the Allocate to Fully Retired or Fully Reserved Assets option is not
checked than the Group asset depreciation will not be allocated to the fully
36
retired or fully reserved member asset. This works with one of the following
two options:
Reduce Excess.
This option is picked as default for Allocate Group Amounts tracking
method. When the depreciation is being allocated to a member asset,
validation happens as to whether the current period depreciation will make the
member asset to become fully reserved. The excess amount is reduced from
the depreciation expense charged to the group asset for the period.
For example:
Group Asset
Member 1
Member 2
Member 3
Asset Cost
31500
18000
9000
4500
Current reserve
21510
17910
2400
1200
Depreciation basis
14200
2200
8000
4000
The depreciation method is a NBV based with 20% rate quarterly

Group asset depreciation=14200*0.2/4=710
37
Depreciation basis of the group asset is 14200

Member Asset 1 = 2200
Allocated depreciation to Member Asset 1= 710* (2200/14200) = 110
Allocated depreciation to Member Asset 2= 710* (8000/14200) = 400
Allocated depreciation to Member Asset 3= 710-(110+400) = 200
After allocation a validation is done as to whether the member asset is becoming
fully reserved after allocation: Allocated depreciation to Member Asset 1 = 17910+110 = 18020>18000 (Cost)
Allocated depreciation to Member Asset 2 = 2400+400 = 2800<9000 (Cost)
Allocated depreciation to Member Asset 3 = 1200+200 =1400<4500 (Cost)
For Member Asset 1, if 110 are allocated to the asset, it ends up being fully
reserved, in fact it will have a negative NBV of 20. Thus Depreciation will be
allocated only till the Member asset becomes fully reserved. The balance
amount of 20 will be reduced from the depreciation expense for the group.
Thus, the depreciation charged for the group would be 690 (710-20).
Thus the depreciation charged for member asset is as follows:
Member Asset 1 = 90
Distribute Excess
When the depreciation is being allocated to a member asset, validation
happens as to whether the current period depreciation will make the member
asset to become fully reserved. The excess amount is redistributed between
the other member assets of the group that are not fully reserved, based on their
depreciation basis of the remaining member assets.
Like in the above Example for Reduce Excess:
The balance 20 will be distributed between member 2 and Member 3.
Recalculate the group amount as Original Group = Depreciation less allocated
amount to Member 1.
The recalculate group amount = 710 90 = 620.
38
Distribute the recalculated group level amount to the other member assets:
Member Asset-2 Recalculated Allocated Amount =
=620 * 8,000/(8,000 +4,000) = 413.33
Member Asset-3 Recalculated Allocated Amount = 620 413.33 = 206.67
Check the amounts again
Member Asset-2: Reserve Amount = 2,400 + 413.33 = 2,813.33 < 9,000
Member Asset-3: Reserve Amount = 1,200 + 266.67 = 1,466.67 < 4,500
Member Asset-1: Allocated Depreciation = 90.
Member Asset-2: Allocated Depreciation = 413.33
Member Asset-3: Allocated Depreciation = 206.67.
The reduce excess and distribute excess are mutually exclusive options.
6.1.4.2 Calculate Member Asset Amount

This method calculates the depreciation amount of member assets individually.
The member asset can be depreciated by:

Group Method: The depreciation method used to calculate the Member asset
depreciation is the group assets depreciation method. With this option the total
of member and group depreciation expense will always be the same as the
depreciation method used for both is the same.
Member Method: The depreciation method used to calculate the Member
asset depreciation is the member assets depreciation method. With this option
the total depreciation expense amount of the Member may not be equal to the
group asset. In such a situation the group depreciation amounts will be booked
at the Group asset level, the member asset amount are just for calculation
purpose.
39
To facilitate a way by which this mismatch between the group and the
sum of member asset depreciation can be avoided is Sum Member
Asset Depreciation to Group option.
Sum Member Asset Depreciation to Group: When this checkbox is check
the Member asset depreciation expense amount will be summed up to the
Group asset level. The group level depreciation amount will be replaced by
this amount. In such a case the Member asset depreciation amount will be
booked at the Member asset level only.
Note that when Sum Member Asset Depreciation to Group is enabled,
retirement gain/loss must be recognized, Do Not Recognize is not supported in
this setup.
For example:
Asset cost
Group Asset
Member Asset 1
Member Asset 2
Member Asset 3
45000
20000
15000
10000
Depreciation method with Four periods

in a Year
Flat cost 20%
Flat cost 10%
Flat cost 20%
Flat cost 30%
Depreciate by Group Method:

Member Asset 1 = 20000*0.2/4 = 1000
Member Asset 2 = 15000*0.2/4 = 750
Member Asset 3 = 10000*0.2/4 = 500
------------Total of Member asset Depreciation = 2250
-----------Group Asset depreciation = 45000*0.2/4 = 2250 which the same as the Total of the
Member asset depreciation amounts.
Depreciation by Member Method:
Member Asset 1 = 20000*0.1/4 = 500
Member Asset 2 = 15000*0.2/4 = 750
Member Asset 3 = 10000*0.3/4 = 750
------------Group Asset Depreciation = 45000*0.2/4 = 2250 which is not equal to the Total of the
Member asset depreciation amounts.
Now if Sum up member option is enabled when depreciate by Member Method is
selected:
40
Member Asset 1 = 20000*0.1/4 = 500

Member Asset 2 = 15000*0.2/4 = 750
Member Asset 3 = 10000*0.3/4 = 750
------------After all member asset calculation is done, the group level depreciation which displays
online will be a dynamic summation of the depreciation expense of member asset. No
depreciaton is stored at the Group Asset level. Plus the depreciation will be posted from
the member asset level only.
Group Asset Depreciation = 2250
2000
6.1.5 Advanced rules: Reduction rules
Reduction Rule- Reduction Rate, Addition, Adjustment, Retirement

The reduction rate will be applied when calculating the depreciation basis for the group
asset. This is used to satisfy the 50% rule in Canada and India. User will set up the
default reduction rate for a group asset. Such reduction rate will be defaulted to its
members assets. This reduction rate is only a default setup at the group asset level, and
may be changed at each of the member transaction (i.e. addition, adjustment, retirement).
41
The reduction rate is used to reduce a percentage of the transaction amount from the
depreciation basis of the group before depreciation is calculated for the group asset. The
range of transactions on which this rate is to be applied can be selected by checking the
checkbox for addition, adjustment or retirement.
For example in Canada (CCA) if Addition plus/minus adjustments less Proceeds of sale
is a positive amount in a given period for a group asset, that half of such amount must be
deducted from the depreciable basis when calculating the group depreciation amount. The
depreciation basis must be Year End balances with positive reduction amount for the
depreciation method attached at the group asset level. Reduction rate is set to 50% and all
three checkboxes (Addition, Adjustment, and Retirement) are checked.
Beginning depreciation basis
Add Addition
Add Adjustment
Less Proceeds of Sales
100000
40000
20000
(10000)
------------Balance before 50% Reduction rule
150000
Less 50% of excess amount (150000-100000)
(25000)
------------Group depreciation basis after Reduction rule
125000
------------Reduction Rules can only be set up if the depreciation method attached to the group asset
has one of the following depreciation basis:
Year End balances with positive reduction amount
To do a set up for Canada (CCA) set the reduction rate to 50% and set the
Adjustment check box :ON
Retirement check box :ON
Year End balance with half year Rule.
To do the set up for India 50% rule set the reduction rule to 50% and set the
Adjustment check box: Unchecked
Retirement check box: Unchecked
Refer to Canada and India tax requirement in the Topic: Global Perspective and
depreciation basis rule white paper note number 276453.1. Note that it is highly
recommended to set reduction rate to 0% for the purposes of conversion and reset to
correct value when conversion is done.
After this enter the distribution in the assignments form just as it is done for any other
asset.
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6.2 Group Asset Addition via Quick Additions on Asset Workbench

A group asset can be entered via quick additions as well. The asset type should be
Group. The depreciation rules like depreciation method, depreciate flag, Prorate
convention will default from the category. The date placed in service will default to a
current period date, which can be changed to a prior period as well. The cost will be Zero,
as Group asset cannot have a cost of its own. Group asset cost is the sum of its member
assets cost.
In the assignments block enter the distributions.

After the quick addition has been saved, the group asset is queried again to see what is set
as default for other fields.
In the depreciation tab, Salvage value type, salvage value percentage, depreciation limit
default from the category defaults. Though if salvage value type is required as sum of
member assets, it will not be defaulted, as there is no such option in the categories form.
The salvage value type will need to be updated from the asset workbench. Same is the
case with depreciation limit.
Over depreciate: It defaults to Do not allow.
Super group: It grayed out as the over depreciation flag is set to Do Not Allow.
43
In the advanced rule tab, the retirement options are defaults as follows
Retirement options
Recognize gain and loss: It defaults to Do Not Recognize with both recapture excess
reserve and limit net proceeds checkboxes unchecked.
Terminal gain and loss: It defaults to Recognize Immediately.
Tracking options
These will not be enabled even if member tracking is enabled at the Book level.
Reduction rules
The reduction rate will be grayed out, though if the depreciation basis is set to Year End
balances with positive reduction amount or Year end balance with half year Rule for
the depreciation method attached to the Group asset. Than the reduction rate will default
to 0% and the addition, adjustment, and retirement check boxes will not be checked but
will be updateable fields.
44
6.3 Group Asset Addition via Prepare Mass Additions

A Group asset can be added via mass addition also. This is similar to mass addition of
any other asset except the fact that the Asset type must be Group. A future addition can
be performed for a Group Asset though a future adjustment or a future capitalization
cannot be done. When creating the asset via prepare mass addition, depreciation rules
default from the category. The Other fields like in retirement or member tracking options
will default the same way as for quick additions. Though these fields may be changed if
required via the asset workbench.
6.4
Group Asset Addition via Web ADI
Navigate to Mass Additions>Additions Integrator>Excel 2000>Integrator Fixed AssetsAdditions>Book>layout Add Assets-default.

The Asset type Group Asset should be picked from the Asset type List of values.
45
The Rest of the mandatory fields need to be added just like any other assets. The
depreciation rules will default from the category set up. The rest of the fields are set as
default similar to the defaults when the asset is added via quick additions. Most of the
retirement or member tracking option can be updated from the asset workbench if a value
different than the default is required. Though no validation happens as to the zero cost of
the group asset. If a cost is entered it will get picked up while uploading the data to
interface but post mass addition will set the cost back to zero.
MEMBER ASSET ADDITION
A Member Asset can be assigned to a Group asset in many ways. Following are the
various methods of assigning a member asset to a Group:
A. Detail Addition on Asset Workbench,
B. Quick addition on Asset workbench.
C. Category
D. Mass Additions
E. Web ADI
7.1 Member Asset addition via detail addition on asset workbench

The Member asset addition is just like any other asset except for the Group asset tab on
the asset Workbench.
Group asset fields need to be populated with the Group Asset Number. This is the
group to which the member asset will belong.
46
In the group reclassification tab:

Transfer type defaults to calculate and it cannot be updated.
Group Amortization start date: Every member asset addition is an amortized
adjustment to the group so the amortization start date is the date on which this member
asset addition will take affect for the group asset. It defaults to the Date placed in service
of the member asset but can be updated to any date from Date placed in service of the
group asset to the current date.
Reduction Rate: Reduction rate is enabled when the group asset is populated. The rate
defaults from the rate entered for the group. But additions check box should also be
checked in the Reduction Rules for the Group Asset to get the fields enabled for member
asset additions.
The expense account for the member asset defaults to the expense account entered for the
group asset. This is more so because the journal entries are to be passed at the group asset
level only. If it is desirable for a reporting reason to override this, that is allowable, but
no posting will be done with the member depreciation information unless member
tracking is enabled with sum up option enabled.
If the group asset has member tracking enabled with sum up option the expense account
can be different from the group, as the journal entries will be passed at the Member asset
level. The company segment has to be the same as the group asset if Allow
intercompany Member Assets Assignments is not enabled for the book. If Allow
intercompany Member Assets Assignments is enabled than any expense account can be
given for the member asset.
47
7.2 Member Asset Addition via Quick Additions on Asset Workbench

A member asset can be assigned to a group asset by populating the group asset field with
the group asset number, in the books region of the Quick Addition form. This is the group
asset to which this member asset will belong.
7.3 Member Asset Addition: Category

A group asset default can be set at the category level. This Group asset will default while
adding any asset to the category from the Asset Workbench.
Other setup options will default from the Group Asset, in case the Group Asset has
different defaults than the category defaults.
48
For all assets added in this category via post mass addition this group asset will default.
And this is irrespective of the fact that no Group asset id was entered for the asset in the
fa_mass_additions table.
7.4 Member Asset Addition via Prepare Mass Additions
A member asset can also be added via prepare mass additions. The group asset number
needs to be added in the group asset field on the header in the Mass additions form,
unless it will default from the category. This asset will be added as a member asset belongs to
a group. The group asset number given here will supersede what is entered as a default in
the category setup.
Every member asset addition is an amortized transaction for the group asset. The
amortization start date defaults to the member assets date placed in service.
49
7.5 Member Asset Addition via Web ADI

A member asset can be added to the Group via Web ADI also.
Navigate to Mass Additions>Additions Integrator>Excel 2000>Integrator Fixed AssetsAdditions>Book>layout Add Assets-detail.
The group_asset_id field needs to be entered to assign the member asset to the group.
This will supersede the default entered at the category level.
8
DISABLING GROUP ASSETS
A group asset cannot be deleted once a member asset is added to the Group asset. The
group asset cost is a sum total of its member asset cost, it does not have any cost of its
own. Thus, a retirement transaction may not be performed on a group asset.
So how to remove a group asset from the Book?
A group asset can be disabled from the asset workbench by checking the disable
checkbox on the depreciation tab of the books window.
50
Prerequisites for disabling a group asset:

Fully retire all the member asset of this group, or
Reclassify the members out of this group, and
The cost of the group asset must be zero.
51
Disabling a group asset in one book has no affect on its status in other books. A disabled
group asset will not depreciate and no transaction can be performed on it. Disabled Group
assets are excluded from the group asset list of values in the asset workbench, Mass
Additions, mass change, and mass reclassification window. A disabled group asset should
not be set as default in category defaults as a member asset cannot be added to a disabled
group.
A disabled group asset can also be re-enabled via the asset workbench. All restrictions
are removed after a group asset has been enabled. Thus the group asset can depreciate
and transaction can be performed on it.
QUERYING A GROUP ASSET ON THE ASSET WORKBENCH OR

INQUIRY FORMS.
In order to search for group asset, member asset or individual asset, there are additional
search criteria on the asset workbench and the Inquiry forms.
If all assets attached to a book are needed than no criteria except the book needs to be
entered in the find form. All assets will come up whether group, member or stand alone
assets.
If only group asset need to be queried, the asset type needs to be give as Group in the
selection criteria.
52
To search for the member asset belonging to a particular group, let the asset type be blank
and enter the group asset number in the Group asset Field. All members assigned to that
group asset will come up.
To search for all the disabled assets in a group, enter the book and enable the Show
Disabled Groups. All disabled group asset will come. This is more so, when these
disabled assets are not shown in any list of values of group asset, in any of the forms.
53
The asset type of Capitalized as the selection criteria will output all member or
standalone asset entered in that book. The group asset will not be output via this selection
criterion. The asset type needs to be CIP if only CIP asset entered in the book need to
be queried.
Usually, disabled Group assets are excluded from the group asset list of values in the
asset workbench, and other windows. Thus even if the asset type of Group is entered, as
selection criteria the disabled assets will not be queried.
To search for disabled asset the check box Show Disabled Groups needs to be checked.
Only disabled group asset will come up in this case.
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10 ONE TIME ENTRY AND UPDATABLE PARAMETERS

10.1 Group asset
Cost, original cost, recoverable cost, net book values are not updatable fields.
Salvage value type
The salvage value type can be changed at any point of time in the group asset life. The
change of Salvage value will be treated as a current change only.
YTD and depreciation reserve can be updated/entered for the Group asset only in the
period of addition after a member asset is assigned to the Group and only when member
tracking is not enabled. This type of update should only be done after conversion of
members is complete.
Depreciation tab:
Depreciate
This flag is updatable at any time. It is checked by default. If it is unchecked than
depreciation will not be calculated for that group asset. But a catchup will happen once it
is checked again.
Method
The depreciation method can be changed at any time in the Group asset life.
55
Date Placed In Service

The date placed in service can be changed before depreciation begins for the Group asset
and no member asset has been assigned to the group. After one depreciation run is done
this field is no longer updatable.
Prorate convention and prorate date
Prorate convention and dates are not updatable after the period of addition. Anyways they
are display only field, the depreciation start date is the date placed in service of the group
asset.
Amortized Adjustment
All transactions on the group or its member are amortized thus this field cannot be
updated.
Amortization start date
The Form always shows the current period date as the amortization start date. But this
can be updated depending on the amortization start date need to be entered for a
transaction being performed on the Group or its member.
Depreciation limit
Depreciation limit can be changed any time in the group asset life. But the change will be
taken as a current period change only.
Over depreciate
Over depreciation parameter can be changed at any time in the asset life if the Group
asset reserve is less than the total group asset recoverable cost at the time of change. The
change is a current period change only.
Super group
Super group is an updatable field provided the over depreciation parameter is set to
Allow or Allow and depreciate but the change is taken as a current period change only
for the affected assets. The same is the case with the depreciation rate and /or salvage
value percentage change for a super group.
56
Retirement options
Retirement option can only be changed in the period of addition and before any member
asset is assigned to the group.
Tracking option
Tracking option can only be changed in the period of addition and before any member
asset is assigned to the group.
Reduction Rule
Reduction rule can be changed for the Group asset in the subsequent period. The change
will be a current period change only.
The distribution information can be change at any time for the group asset and behaves
similarly to a transfer in standalone assets.
57
10.2 Member Asset
Depreciate
This flag is updatable at any time. It is checked by default.
It has no effect if member tracking is not enabled.
If unchecked and member tracking is enabled with calculate member amount
is enabled then that member asset will not calculate depreciation.
If unchecked and member tracking is enabled via Allocate, the particular member will
not receive any allocation.
In order to reclass a member into the group for conversion when ENERGY UOP is
used, this flag must be disabled. It then needs to be reenabled after conversion to
ensure that allocation occurs.
Depreciation method
The depreciation method can be changed at any time. This will have no effect unless
member tracking is enabled for the Group and the tracking method is calculate member
amount. This will be treated as a current period adjustment only.
Date in service
Date in service can be changed at any time in the member asset life, provided it is
between the group asset date in service and the current period date. Though it will be
treated as a current period change for the Group asset.
Amortized Adjustment
All transactions on the group or its member are amortized thus this field cannot be
updated.
58
Amortization start date

The Form always shows the current period date as the amortization start date. But this
can be updated depending on the amortization start date needed to be entered for a
transaction being performed on the Member asset.
Depreciation limit
Depreciation limit can be changed any time for the member asset. But this will have an
effect only if the depreciation limit type for the Group asset is Sum of member assets.
The change will be taken as a current period change only.
Group Asset
The group asset can be changed at any time in the member asset life. The transaction will
be taken as a group reclassification. This can be current as well as prior period
transaction.
Reclassification is performed in the Group reclassification block in the Group asset tab on
the Asset workbench. The fields in this block are generally grayed out except when a
reclass is performed.
Reclassification can also be done via API or via Mass Change.
Reduction rate
The Group Assets reduction rate defaults to the member asset, but it can be changed
while performing the transaction on the member asset.
59
11 ASSIGNING MEMBER ASSET COST TO THE GROUP

The following are the scenarios for Assigning Member Asset Cost to the Group:
A. Current Period addition
B. Prior period Addition.
C. Future period addition.
D. CIP asset addition
Some rules to keep in mind while assigning Member asset to a Group:
Addition of a member asset will be treated as a Cost Adjustment to the Group
asset level.
The cost is Stored and tracked at member asset level and summarized to the
group asset.
Group asset cost = Sum of Member assets cost
The member asset Date placed in service cannot be older than the group asset
date placed in service.
Group asset may contain member asset with date placed in service in different
periods. (i.e. Assets placed in service is disparate accounting periods)
The asset cost is tracked and posted to GL from member asset level.
The depreciation expense and accumulated depreciation is calculated and stored
at the Group asset level, unless member tracking is enabled for the Group. With
member tracking the depreciation is also tracked and stored at the member asset
level.
The journal entries will be posted to GL from the Group asset level only except
if member tracking option of Calculate Member Asset Amount with Sum up
member asset depreciation to group checked.
11.1 Current period member addition
Addition of member asset is treated as a cost adjustment to the group. The group asset
cost is the sum of its member assets.
For example
Group Asset:
Member Assets
Depreciation Method
Depreciation calendar
Group A Added in Jan-00 (DPIS: OCT-1999)

Member 1 (DPIS: JAN-2000; Cost: 10000)
Member 2 (DPIS: FEB-2000; Cost: 15000)
Straight line; life in Months: 12
Monthly
No matter how many member assets are added, the member asset addition will be taken
as a group adjustment (transaction_type_code).
The addition transaction code will be used for the Group Asset addition itself and that will
generate no accounting due to the zero cost.
60
Group A
Note: ADDITION/VOID transactions no longer occur as of R12, this is an 11i screen shot. In
R12, the original ADDITION remains and any adjustments are ADJUSTMENT type.
The transaction header id 13434 is for the group As Addition while
transaction_header_id 13438 if for the Member 1s addition in Jan-2000. The member 2
is added through the transaction_header_id 13456 in Feb-2000.
All member asset additions are amortized adjustments to the Group. Thus the transaction
subtype is amortized and the amortization start date is the date placed in service of the
Member asset.
The cost is stored at the Member asset level only. And the journal entries all happen at
the member asset level. There are no journal entries for cost at the group asset level.
Member 1
Member 2
Group asset cost is the sum total of its member cost. This cost forms the basis of the
groups depreciation calculation.
Our example does not have member tracking enabled thus the depreciation tracked at
stored at the Group asset level only.
The following section explains the group depreciation calculation:
61
Group A
Calendar period
Member 1
Member 2
Group Asset Cost
Depreciation basis
Group depreciation
Jan-2000
10000
10000
10000
833.33
Feb-2000
10000
15000
25000
24166.67
3020.83
Group depreciation For JAN-2000

= Cost/life in months
= 1000/12
= 833.33
Depreciation basis for the Month of Feb-2000
= New Cost-Reserve
= 25000-833.33
=24166.67
Group depreciation for the Feb-2000
= Depreciation Basis/Remaining life of the Group Asset
= 24166.67/8
= 3020.83
Remaining life as on Feb-2000
Date placed in service for the group asset is Oct-1999. So 4 periods have
already passed leaving only 8 months in the Group Assets life. This can
also be calculated as follows:
=Rate adjustment factor*life in months
= 0.6666672*12
= 8 Months
62
Group A
11.2 Prior period member addition

Prior period member asset addition is treated as an amortized adjustment to its group in
prior period. Process group adjustment (FAPGADJ) concurrent program is spawned to
process the prior period member asset addition to the Group. The transactions work quite
similarly to current period addition except for the catchup calculated due to the prior
period addition.
Note: When UOP depreciation with Energy Period End Balance is used, all transactions
must be amortized to the current period.
For example
Group Asset:
Member Assets
Depreciation Method
Group A Added in Jan-00 (DPIS: Oct-1999)

Member 1 Added in Jan-00 (DPIS: Dec-1999; Cost: 10000)
Member 2 Added in Mar-00 (DPIS: Feb-2000; Cost:15000)
Monthly
Group A
The transaction header id 13439 is for the group As Addition while

transaction_header_id 133443 if for the Member 1s addition in Jan-2000. The member 2
is added through the transaction_header_id 13461 in Mar-2000.
The cost is stored, tracked and posted from the member asset level.
Member 1
63
Member 2
Our example does not have member tracking enabled thus the depreciation tracked at
stored at the Group asset level only.
The following section explains the group depreciation calculation:
Group A
Calendar period
Member 1
Member 2
Group Asset Cost
Depreciation basis
Total Depreciation Charged for the period
Catchup
Jan-2000
10000
Feb-2000
10000
10000
10000
2000
1000
10000
10000
1000
Mar-2000
10000
15000
25000
23000
4750
1875
The depreciation charged for Jan-2000 (Member 1 added with DPIS in Dec-99)
= Current period depreciation + Catchup depreciation
= (Cost/remaining life for the group asset)+ Catch up depreciation
= (10000/10)+(10000/10)
= 1000+1000
= 2000
Catch up depreciation = (Cost/remaining life for the group asset)*No of periods for
Catchup
= (10000/10)*1
= 1000
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Remaining life For the Group Asset:

DPIS for the group asset is Oct-1999 and the Member 1 is added with
DPIS of Dec-99, So 2 periods have already passed leaving only 10 months
in the group assets life. This can also be calculated as follows:
= 0. 833334*12
= 10 Months
Depreciation charged for the Month of Feb-00
= Cost/remaining life for the group asset
= 10000/10
= 1000
Depreciation basis for the Month of Mar-2000
= New Cost-Reserve charged till Jan-00 (Since the DPIS of Member 2 is
Feb-00)
= 25000-2000
= 23000
Catch up depreciation = (Depreciation Basis/remaining life for the group asset) * No. of
periods for catchup- depreciation already charged for Feb00
= (23000/8)*1-1000
= 2875-1000
= 1875
Depreciation charged for the Month of Mar-2000 (Member 2 added with DPIS in Feb-00)
= Current period depreciation + Catchup depreciation
= Depreciation Basis/Remaining life of the Group Asset + Catchup
depreciation
= (23000/10)+1875
= 2875+1875
= 4750
Remaining life for the Group asset:
DPIS for the group asset is Oct-1999 and the Member 2 is added with
DPIS of Feb-00, So 4 periods have already passed leaving only 8 months
in the group assets life. This can also be calculated as follows:
= 0.6666672*12
= 8 Months
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Group A
The catch up depreciation is booked as an expensed depreciation adjustment for the

group asset.
11.3 Future period Member Asset Addition
A member asset may be added as a future period addition. Future period addition is
enabled only via mass additions form. If an asset is added with future period transaction
date, the system will the asset when the future transaction date becomes current.
This addition will behave just like a current period member asset addition.
11.4 CIP Member Asset Addition
CIP asset can be added to a group if CIP assets are allowed in the for Group asset at the
book level. The cost of the CIP member asset will not be included in the group asset cost.
It would be included in the Group depreciation basis when CIP asset are capitalized.
Capitalization of a CIP asset behaves just like a current period member asset addition.
Though a prior period capitalization date can also be given provided it falls between the
group asset date placed in service and the current period date.
To satisfy Canada tax requirements a CIP asset can also be depreciated. The cost of the
source line will be included in the depreciation basis of the Group asset only if the
following conditions are met:
Book Controls-allow CIP depreciation in Group Asset flag
Source line-Depreciate in Group asset check box.
In such a case the source line addition to the depreciation basis is taken as a current
period member asset addition. And the assets behave exactly the same way like a Current
period member assets addition.
66
In the source line form after checking the Depreciate in Group asset check box a prior
period amortization start date can be entered, though it has to be between the date placed
in service of the CIP member asset and the current date.
For mote details refer Group Asset Set up on Book Controls for Corporate Book
12 ADDING A GROUP OR A MEMBER ASSET WITH RESERVE
12.1 Adding a group asset with reserve
A group asset cannot be added with a reserve. The YTD and Accumulated depreciation
fields are grayed out.
But reserve and YTD can be entered for a group asset in the period of addition after one
Member has been added to the Group asset when member tracking is not enabled.
12.2 Member asset addition with Reserve
A member asset cannot be added to the group with an Accumulated depreciation or YTD
figure. In fact YTD and Accumulated depreciation fields are grayed out the moment a
group number is attached to the member asset. And the group asset field is grayed out for
the asset that had YTD and Accumulated depreciation figures entered for them.
The only way to add a member asset with reserve is to add the asset as a standalone asset
with YTD and Accumulated depreciation. Than reclassify the standalone asset to the
Group. The reserve of the standalone asset is added to the group asset reserve.
YTD does not move to the group however, as YTD always remains with the
distribution_id upon which it occurred. The concurrent program Process Group
Adjustment is spawned to process the reclassification.
For example:
Group Asset:
Stand alone asset
Depreciation Method
Group A Added in Apr-00 (DPIS: Jan-00))

Member 1 Added in Apr-00 (DPIS: Jan-00; Cost: 10000;
Reserve= 4000)
Monthly
Reclassification of the Member 1 to the Group A in Apr-00 with the Group amortization
start date as 30-Apr-00 in the group asset tab for the stand-alone asset.
67
Group A
The transaction header is 13612 is the reclassification of the Member 1 to Group A with
the group amortization start date of 30-Apr-00, the reclassification is recognized by the
GC in the transaction_key field.
The same transaction is reflected for the Member 1 via transaction header id 13611.
Member 1
Group A
Member 1
68
Member 1 was added with a reserve of 4000 that is added to the Group asset reserve. The
reserve transfer entry happens for group A and the balancing entry happens in the
Member 1.
This reserve amount will be knocked off with the cost of the asset to calculate the
adjusted cost which is the depreciation basis for Group A.
Group A
Adjusted cost for Group A

=10000-4000
= 6000
Remaining life for the Group asset:
DPIS for the group asset is Jan-2000 and the Member 1 is reclassed to
Group A with Group Amortization start date of Apr-00, So 3 periods have
already passed leaving only 9 months in the group assets life. This can
also be calculated as follows:
= 0.750001*12
= 9 Months
Depreciation for the month of Apr-00
= Depreciation basis/Remaining life of the Group Asset
= 6000/9
= 666.66
Member 1 shows a YTD of 4000 still while the reserve shows Zero as it has been moved
to Group A. A reclass transaction will not move YTD amounts just the reserve amounts
are moved. Thus YTD will not be in sync for the group A and Member 1. The YTD of
Member 1 is 4000 while the YTD of Group A is 666.66 only, that is, the depreciation
expense for Apr-00.
Group A
69
Member 1
Thus the Group Asset behaves like an asset added with reserve and adjusted cost is the
net book value of the group.
13 DEPRECIATION
Depreciation is calculated at the Group asset level. Thus one depreciation reserve would
be maintained and reported for the group.
The Group asset depreciation rules will be used for calculating group depreciation
expenses.
Depreciation for Group Asset= Group rate *Group depreciation basis/ No. Of periods
There is only one exception to the above that is when member tracking is enabled and the
tracking method is calculate member amount, with sum up option. In such a case there is
one depreciation reserve account for each member asset.
Depreciation for group asset = Sum of the depreciation of Member Assets.
Depreciation methods available for group assets include:
Flat rate
Life based method
Formula based
Unit of production with ENERGY PERIOD END BALANCE basis rule
In addition to the depreciation method the depreciation basis rule also determine how
depreciation basis and depreciation amount are derived. There are about eleven
depreciation basis rules available. For more detail on depreciation basis rule refer to
depreciation basis rule white paper note number 276453.1.
13.1 Group depreciation without member tracking option.
The depreciation is calculated, tracked and posted at the group asset level. There
is only one depreciation reserve account for the Group. The depreciation rules of
the Group asset are used to calculate depreciation for the Group Asset.
70
For example:
Group A
Cost: 25000 (DPIS: Oct-2000)
Member 1
Cost: 15000 (DPIS: Oct-2000)
Member 2
Cost: 10000 (DPIS: Oct-2000)
Depreciation Method for Group A 80% Flat rate NBV Based
Depreciation Method for Member 1 and Member 2 is 60% Flat rate
Depreciation basis rule
Use transaction period basis
Monthly
Group A
Member 1
71
Member 2
The basis of the depreciation calculation is the sum of the member assets cost.
Group Assets depreciation basis is
= Member 1 Cost + Member 2 Cost
= 15000 + 10000
= 25000
Depreciation is calculated for the group asset only. The depreciation method is
different for the Group and the member asset but the method used to calculate
depreciation will be the Group assets depreciation method.
Thus the depreciation method used to calculate depreciation is 80% Flat rate NBV
Based
The Monthly depreciation is
=(Group Asset Cost* Rate)/No of periods in a year
= (25000*0.80)/12
=1666.66
Group A
Member 1
72
Member 2
No depreciation is calculated for the member assets. Since depreciation is

calculated only at the group asset level, it is posted to GL from Group asset level
itself.
13.2 Group depreciation with member tracking option.
With member asset tracking option enabled the depreciation is tracked at the
group asset as well as member asset level. But the way depreciation is calculated
for a member asset differs for different tracking options.
The following section will explain how member asset tracking behaves with
different tracking options.
13.2.1 Allocate group amount
The group depreciation amount is distributed among its members based on the
depreciation basis of each member in proportion to the Group assets depreciation
basis. The depreciation amount is posted at group level only. There is only one
depreciation reserve account for the Group. The depreciation rules of the Group
asset are used to calculate depreciation for the Group Asset.
13.2.1.1 Allocate Group Amount with Distribute Excess
After every depreciation run a validation happens as to whether the member
asset is becoming fully reserved after the current period depreciation amount
is allocated. In case one of the member becomes fully reserved than the excess
depreciation that could not be charged to the member asset due to it becoming
fully reserved, is distributed among the remaining members. This validation
happens after every depreciation calculation.
For example:
Group A Cost: 35000 (DPIS: Jan-2000)
Member 1 Cost: 20000 (DPIS: Jan-2000)
Depreciation Method
80% Flat rate NBV Based
Monthly
No depreciation limit is set.
73
Period 1 (Jan-00 period counter 24001)

=(Group Asset Depreciation basis* Rate)/No of periods in a year
= (35000*0.80)/12
= 2333.33
Group A
Member 1
Member 2
Allocation of Group depreciation happens as follows:

=Group asset depreciation * (member asset depreciation basis/Group Assets
Depreciation basis)
Member 1 = 2333.33* (20000/35000) = 1333.33
Member 2 = 2333.33* (15000/35000) = 1000.00
Period 2 (Feb-00 period counter 24002)
An override of 25000 is entered for Group A
=Group asset depreciation * (member asset depreciation basis/Group
Assets Depreciation basis)
Member 1 = 25000* (20000/35000) = 14285.71
Member 2 = 25000* (15000/35000) = 10714.29
74
Depreciation is run for 3rd (Mar-00 period counter 24003) and 4th (Apr-00
period counter 24004) period, with calculations similar to period 1 (Jan-00
period counter 24001).
Period 5 (May-00)
Member 1 = 1000* (20000/35000) = 571.43
Member 2 = 1000* (15000/35000) = 428.57
Period Group As
Depreciation basis
1
35000
2
35000
3
35000
4
35000
5
35000
Total
Override
entered
25000
1000
Group A
Member 1
Member 2
2333.33
25000.00
2333.33
2333.33
1000.00
32999.99
1333.33
14285.71
1333.33
1333.33
571.43
18857.13
1000.00
10714.29
1000.00
1000.00
428.57
14142.86
Thus the NBV for the group at the end of period 5 is as follows:
=Cost less depreciation charged till the 5th period.
Group A NBV = 35000 - 32999.99 = 2000.01
Period 6 (Jun-06 period counter 24006) a new Member 3 is added.
Member 3
Cost: 10000 (DPIS: Jun-2000)
After the member asset is added to the group, the depreciation basis of the group is
calculated as follows:
= New member asset cost + Group A NBV at the end of 5th period
=10000+2000.01
=12000.01
75

=(Group Asset Depreciation Basis* Rate)/No of periods in a year
= (12000.01*0.80)/12
= 800
Member 1 = 800* (20000/45000) = 355.56
Member 2 = 800* (15000/45000) = 266.67
Member 3 = 800* (10000/45000) = 177.77
Depreciation is run for the 7th (Jul-06 period counter 24007), 8th (Aug-00
period counter 24008) and 9th (Sep-00 period counter 24009) periods with
the same calculations.
Period
6
7
8
9
Total
Group As
Depreciation
basis
12000.01
12000.01
12000.01
12000.01
Group A
Member 1
Member 2
Member 3
800
800
800
800
355.56
355.56
355.56
355.56
20279.37
266.67
266.67
266.67
266.67
15209.54
177.77
177.77
177.77
177.77
711.08
As usual the validation as to whether any of the member asset becomes fully
reserved after depreciation is calculated for the 9th period.
Check the allocated amount:
Member 1 = Total Reserve Amount = 20279.37 > 20000
The depreciation that can be charged for the Member 1 = 76.19
Excess Depreciation Allocated = 279.37
Member 2 = Total Reserve Amount =15209.54 > 15000
The depreciation that can be charged for the Member 2 = 57.13
Excess Depreciation Allocated = 209.54
Member 3 = Reserve Amount= 533.31+ 177.77 = 711.08 < 10000
But since we have distribute excess check box checked. The excess depreciation
on Member 1 and Member 2 will now be charged to remaining members of the
Group. In this example, the excess depreciation will be charged to the Member 3.
Thus the Depreciation charged for Member 3 =
=Excess depreciation for Member 1+ Excess depreciation for Member 2+
Depreciation allocated to Member 3.
= 279.37 + 209.54 + 177.77
= 666.68
76
Here the group depreciation amount remains the same irrespective of some of its
member asset becoming fully reserved, the remaining member take the burden of
extra depreciation.
Group A
Member 1
Member 2
Member 3
Note that if all depreciation cannot be allocated, the Groups depreciation will be reduced by the amount not
available for allocation. This occurs when Distribute Excess cannot distribute all the excess.
77
13.2.1.2 Allocate group amount with reduce excess

After every depreciation run a validation happens as to whether the member asset is
becoming fully reserved after the current period depreciation amount is allocated. In
case one of the member assets becomes fully reserved than the excess depreciation
that could not be charged to the member asset due to it becoming fully reserved, is
reduced from the Group asset depreciation amount. This validation happens after
every Depreciation calculation.
For example:
Group A
Cost: 25000 (DPIS: Jan-2000)
Member 1
Cost: 15000 (DPIS: Jan-2000) Member 2
Cost: 10000 (DPIS: Jan-2000)
Depreciation Method
Monthly
Group A
Member 1
Member 2
Period 1 (Jan-00 Period counter 24001)

=(Group Asset Depreciation Basis* Rate)/No of periods in a year
= (25000*0.80)/12
= 1666.67
78

Member 1 = 1666.67* (15000/25000) = 1000
Member 2 = 1666.67* (10000/25000) = 666.67
Period 2 (Feb-00 Period counter 24002)
A depreciation override of 20000 for Group A

Member 1 = 20000* (15000/25000) = 12000
Member 2 = 20000* (10000/25000) = 8000
Period 3 (Mar-00 Period counter 24003)
Member 1 = 1666.67* (15000/25000) = 1000
Member 2 = 1666.67* (10000/25000) = 666.67
Period Group As
Depreciation basis
1
25000
2
25000
3
25000
4
25000
Total
Override
entered
20000
550
Group A
Member 1
Member 2
1666.67
20000.00
1666.67
1216.66
24550.00
1000.00
12000.00
1000.00
550.00
14550.00
666.67
8000.00
666.67
666.67
10000.00
Period 4 (Apr-00 Period counter 24004)

A depreciation override of 550 is entered for the Member 1
79
Thus,
Member 1 = 550 (due to override)
Member 2 = 1666.67* (10000/25000) = 666.67 (Allocated depreciation amount)
Thus the Depreciation charged to Group A, and since the checkbox Reduce
excess is checked the excess depreciation that could not be charged for the
member 1 is reduced from the Group asset amount.
=550+666.67 = 1216.66
Period 5 (May-00 Period counter 24005)
Member 1 = 1666.67* (15000/25000) = 1000
Member 2 = 1666.67* (10000/25000) = 666.67
A validation happened as to whether asset would become fully reserved after the
depreciation is allocated.
Member 1 = Cost - Reserve till period 4 = 15000- 14550 = 450
Thus depreciation to the extent of 450 out of 1000 can be allocated to the asset.
Member 2 = Cost - Reserve till period 4 = 10000-10000 = 0.00
Thus no depreciation can be allocated to Member 2.
The depreciation charged for Group A for period 5 will be 450 instead of the
monthly charge of 1666.66. The excess depreciation that couldnt be charged to
the member asset due to the fact that they were fully reserved is reduced from the
group asset depreciation.
Group A
80
Member 1
Member 2
13.2.1.3 Allocate Group amount with Allocate to fully retired and reserved Assets
In this case no validation happens as to whether a member asset is becoming fully
reserved or not. Depreciation is allocated even if the member asset is fully
reserved. The allocation of depreciation happens to fully retired member assets as
well.
13.2.2 Calculate member amount
The member asset depreciation amount is calculated based on the depreciation
rule entered at the group or member asset level.
If the group depreciation rules are used than group asset depreciation will always
be equal to the sum of its member asset. Since the same depreciation rules are
used to calculate the group as well as member level depreciation.
If the member depreciation rules are used than the Group asset depreciation may
not be equal to the sum of its members as the depreciation rules attached to the
Member and the Group may be different. The group asset rules will be used to
calculate Group depreciation while member asset rules will be used for the
member asset.
13.2.2.1 Calculate Member amount with sum Member Asset Depreciation to
Group disabled.
The member asset amounts are calculated based on the group or the member asset
depreciation rules. If the member asset depreciation rules are different than the
group asset rules, the group asset depreciation and the total of the member asset
depreciation may not be equal. Indeed, it is expected that over time these values will
diverge.
There is only one depreciation reserve account for the Group and depreciation is
posted to GL at group asset level only.
81
For example:
Group A Cost: 50000 (DPIS: Jan-2004). Depreciation method: STL 60 months
Member 1 Cost: 30000 (DPIS: Jan-2004). Depreciation method: STL 36 months
Member 2 Cost: 20000 (DPIS: Jan-2004). Depreciation method: Flat 33%
Monthly
Tracking Method: Calculate member amount
Depreciation by: Member Method
Group A
Member 1
Member 2
Group A Depreciation:
=(Group Asset Cost/life in months)
= (50000/60)
=833.33
Member 1 Depreciation:
= (Member Asset Cost/life in months)
= (30000/36)
= 833.33
82
Member 2 Depreciation:
= (Member Asset Cost*rate)/No. Of periods in a Year.
= (20000*.33)/12
= 550
Sum of Member asset depreciation:
= Member 1 depreciation + Member 2 Depreciation
= 833.33+550
= 1383.33
The sum of member asset depreciation is not equal to the Group asset
depreciation
Group A
Member 1
Member 2
Though the depreciation of 833.33 will be posted to GL from the group asset level
only.
13.2.2.2 Calculate Member amount with sum Member Asset Depreciation to Group
enabled.
The Member asset depreciation will be summed up to the Group asset. This
makes sure that the group asset depreciation is always equal to the sum of the
member asset depreciation. This is irrespective of whether the depreciation rules
used are of the member or the Group asset.
The depreciation is posted to GL from the member asset level. There is one
depreciation reserve account for each member asset.
83
For example
Group A Cost: 60000 (DPIS: Feb-2004). Depreciation method: STL 60 months
Member 1: 30000 (DPIS: Feb-2004). Depreciation method: STL 36 Months
Member 2: 30000 (DPIS: Feb-2004). Depreciation method: STL 60 months
Monthly
Tracking Method: Calculate member amount
Depreciation by: Member Method
And Sum Member Asset Depreciation to Group is checked.
Group A Depreciation:
=(Group Asset Cost/life in months)
= (60000/60)
= 1000
Group A
Member 1
Member 2
Member 1 depreciation:
= (Member Asset Cost/life in months)
= (30000/36)
= 833.33
Member 2 depreciation:
= (Member Asset Cost/Life in months).
84
= (30000/60)
=
55
0
Sum
of
Member
asset
depreciation
= Member 1 depreciation + Member 2 Depreciation
= 833.33+500
= 1333.33
The sum of member asset depreciation is set as the Group asset depreciation.
The
Depreciation will be posted at the Member asset
level
Group Asset Depreciation
= 833.33
1333
.33
Group A
There is no depreciation booked for the group asset as the depreciation is

calculated, booked and posted from the member asset level. A
depreciation amount of 833.33 will be booked to GL from Member 1 and
500 will be booked to GL from Member 2.
Member 1
Member 2
There are other factors that affect the calculation of depreciation for the group and
its member asset.
They are as follows:
85
Depreciation Limit
Over Depreciate.
Depreciation
Override.
Unplanned
depreciation.
The following section handles how these factors affect depreciation calculation for the
group asset and its member asset.
13.3 Depreciation limit

Depreciation limit can be set for the Group asset. It can either be a set as a percentage of
group asset cost or sum of member assets depreciation limit. The group depreciation
charged is validated against the depreciation limit set for the Group similar to stand alone
assets. This validation is also done at the member level if member tracking is enabled.
The following explains how depreciation limit affects group depreciation calculation with
member asset tracking enabled.
For example:
Group A
Cost: 25000 (DPIS: Jan-2000)
Member 1
Cost: 15000 (DPIS: Jan-2000)
Member 2
Cost: 10000 (DPIS: Jan-2000)
Depreciation Method
Monthly
Member tracking is enabled with allocate group amounts enabled and reduce
excess checked.
Depreciation limit: Sum of Member assets.
Group A
Depreciation limit: 17000
Member 1
Member 2
Group A
86
Member1
Member 2

= (25000*0.80)/12
=1666.66
Depreciation basis)
Member 1 = 1666.66* (15000/25000) = 1000
Member 2 = 1666.66* (10000/25000) = 666.66
87
In the second period (Period counter 24002) depreciation override of 5700 is

entered for Group A.
Depreciation basis)
Member 1 = 5700* (15000/25000) = 3420
Member 2 = 5700* (10000/25000) = 2280
At the end of second period, compare the total depreciation charged for the asset and the
adjusted recoverable cost i.e. the cost available for depreciation after reducing
depreciation limit.
Asset
Group A
Member 1
Member 2
Depreciation (A)
7366.66
4420
2946.66
Adjusted recoverable cost (B)

8000
5000
3000
C= B-A
633.33
580
53.33
The column C represents the depreciation that can be charged to the asset in the next
period.
Thus despite the monthly group depreciation of 1666.66 the depreciation charged at the
group level is only 633.33 for the third period (Period counter 24003). This is the result
of the validation at the Group asset level.
Now when this 633.33 is distributed among the member assets
Member 1 = 633.33* (15000/25000) = 380
Member 2 = 633.33* (10000/25000) = 253.33 but only 53.33 will be charged to
the asset as the adjusted recoverable cost for the asset is 3000 and 2976.66 is
already charged for the asset.
Thus depreciation charged for this month is 433.33.
At the end of third period (period counter 24003), compare the total depreciation charged
for the asset and the adjusted recoverable cost i.e. the cost available for depreciation after
reducing depreciation limit.
Asset
Group A
Member 1
Member 2
Depreciation (A)
7800
4800
3000
Adjusted recoverable cost (B)

8000
5000
3000
C= B-A
200
200
0
The column C represents the depreciation that can be charged to the asset in the next
period. Thus Group A will be charged with the depreciation amount of 200 for the fourth
period (Period counter 24004) and full amount will be allocated to the Member 1.
Thus the validation happens at both levels, first for the Group and than for the member
assets.
88
Group A
Member 1
Member 2
13.4 Over depreciate

Over depreciation field allows the group asset to depreciate beyond its cost that is the
group asset reserve may exceed group asset cost. There are three option here Do not
allow, Allow and Allow and depreciate. Do not allow means the group NBV cannot
be negative at any time (unless caused by an external event like retirement of a member).
89
If over depreciate is set to Allow or Allow and depreciate then the validation as to
NBV being equal to zero or negative does not happen here. For Allow, the group asset
depreciation can exceed group asset cost but depreciation will stop for the group asset
when the accumulated depreciation is greater than the recoverable cost. But for Allow
and depreciate the depreciation will continue.
For example:
Group A
Cost: 10000 (DPIS: Jan-2000)
Member 1
Cost: 10000 (DPIS: Jan-2000)
Depreciation Method
Monthly
Member tracking is not enabled.
Over depreciate is set to Allow and depreciate.
Group A
As we can see that the group NBV became negative only in the period counter 24007. If
over depreciate was set to Allow then only 24007 period depreciation would have been
charged and no further depreciation would be charged on the Group asset. But since the
over depreciate is set to Allow and depreciate in this example, it continues to depreciate
every period even when the group asset has negative NBV.
Though if the over depreciate was set to Do not allow depreciation for period 24007
would have been charged only to the extent of 300 and than stopped as the group asset
NBV would have become Zero.
13.5 Depreciation override
Depreciation override allows the user to enter a group depreciation amount instead of the
calculated depreciation amount. The overriding amounts are to be inputted via an open
interface table FA_DEPRN_OVERRIDE. From FA.M the table can be populated from
the override form.
Navigation>Depreciation>Override
90
This feature is intended to satisfy Canada CCA requirement. In Canada, companies are
not required to claim the system calculated group depreciation in any given year. Instead
they may choose to claim depreciation amount from zero to the system calculated amount
as group asset depreciation in the current fiscal year.
Depreciation override can be set at group level since depreciation is stored and tracked at
the Group asset level only. The entered amount overrides the amount calculated by the
depreciation engine.
The periodic depreciation for the asset is:

= (Cost*0.60)/12
= (10000*0.60)/12
= 6000/12
= 500
A depreciation override amount of 7000 is entered for May-00 (Period counter 24005) for
the Group asset. Thus after depreciation run for May00 a periodic depreciation of 500 is
overridden by 7000 entered in the fa_deprn_override table. Though validation is done as
whether the group asset is becoming fully reserved after the depreciation override. If the
group asset becomes fully reserved then the depreciation run will error, provided over
depreciate is set to Do not allow.
91
Depreciation override can be entered for a member asset as well, if Member tracking is
enabled. Though the behavior is different for the two tracking methods:
13.5.1 Allocate group amount
For allocate group amount override cannot be entered for both Group and its
members in the same period.
13.5.1.1 Group amount override
When the manual override for the group will be allocated, even if Reduce
Excess is selected. The calculation will be treated as Distribute Excess.
The accumulated depreciation amount after calculation will be validated against
the recoverable cost or depreciation limit of the member as well as the group. If
after allocation a member asset becomes fully reserved, the excess amount will be
allocate proportionately to the other member assets in the group.
For example:
Group A Cost: 35000 (DPIS: Jan-2000)
Depreciation Method
Monthly
Period 1 (Jan-00 period counter 24001)
= (35000*0.80)/12
= 2333.33
Depreciation basis)
Member 1 = 2333.33* (20000/35000) = 1333.33
Member 2 = 2333.33* (15000/35000) = 1000.00
Period 2 (Feb-00 period counter 24002)
Member 1 = 25000* (20000/35000) = 14285.71
Member 2 = 25000* (15000/35000) = 10714.29
92
Group A
Member 1
Member 2
13.5.1.2 Member amount override

While processing the override for a member asset, a validation will happen as to
whether the member or the group asset becomes fully reserved after depreciation
override. In case the asset becomes fully reserved the depreciation run will error.
For example:
Group A
Cost: 50000 (DPIS: Jan-2000)
Member 1
Cost: 10000 (DPIS: Jan-2000)
Member 2
Cost: 15000 (DPIS: Jan-2000)
Member 3
Cost: 25000 (DPIS: Jan-2000)
Depreciation Method
Monthly
=(Cost* Rate)/No of periods in a year
= (50000*0.60)/12
=2500
Depreciation basis)
93
Member 1 = 2500* (10000/50000) = 500

Member 2 = 2500* (15000/50000) = 750
Member 3 = 2500* (25000/50000) = 1250
For Member 1 a depreciation override amount of 7500 is entered in May-2000
(period Counter 24005)
Member 1
Thus the monthly depreciation of 500 is overridden by 7500. After the override is
processed the reserve for the member asset is 9500 that is lesser then recoverable
cost 10000. Thus the override is successfully processed.
Group A
For the Group asset the depreciation is calculated at as follows:

Member 1 = 7500
Member 2 = 2500* (15000/50000) = 750
Member 3 = 2500* (25000/50000) = 1250
Thus total group depreciation for the period is 9500. Including the override
entered for Member 1 and the other assets will have monthly allocated
depreciation
94
13.5.2 Calculate member Asset amount

The override amounts for the member asset or the group are applied instead of
the calculated amount. Though if sum-up option is enabled, system will replace
the Group level amounts with sum of member amounts. Thus depreciation
override cannot be set at the Group asset level under sum up option.
13.6 Unplanned depreciation
An unplanned depreciation amount can be entered for a group asset via Asset
Workbench-book form. Unplanned depreciation is available if the depreciation
method is Flat for the Group asset. It can also be entered if the Group
Assets method is Units of Production with ENERGY PERIOD END
BALANCE depreciation basis rule. Unplanned depreciation cannot be
entered for an asset that has no member assigned to it.
A zero cost asset cannot have an unplanned transaction performed except for the
case where the cost is Zero but the over depreciate is Allow or Allow and
depreciate. The behavior of unplanned depreciation for group asset is quite
similar to standalone asset if member tracking is not enabled. Though here also a
validation is done as to the fully reserved status of the group as well as the
member asset.
With member Asset tracking enabled unplanned depreciation with behave as
follows with different tracking methods:
13.6.1 Allocate group amounts
Unplanned depreciation can be entered for the group as well as its member:
13.6.1.1 Unplanned depreciation performed at group level
When the unplanned depreciation is entered for the group asset, it will be
allocated among its member asset. Even if Reduce Excess is selected, the
calculation will be treated as Distribute Excess.
The accumulated depreciation amount after depreciation calculation will be
validated against the recoverable cost or depreciation limit of the group as well as
the member asset. If after the depreciation calculation, any member asset becomes
fully reserved, excess amount that cannot be charged due to asset becoming fully
reserved, will be allocate proportionately to the other member assets in the group.
For example:
Group A
Cost: 15000 (DPIS: Oct-2000)
Member 1
Cost: 10000 (DPIS: Oct-2000)
Member 2
Cost: 5000 (DPIS: Oct-2000)
Depreciation Method
Monthly
=(Group asset depreciation basis* Rate)/No of periods in a year
= (15000*0.80)/12
= 1000
95
In the second period (Period counter 24011) an unplanned depreciation of 12000

is entered for group A.
Thus the depreciation for the period is 13000 i.e. 12000 unplanned depreciation
plus 1000 Monthly depreciation.
Group A
This depreciation charged for the group will be allocated to the member asset
based on their depreciation basis.
Depreciation basis)
Member 1 = 1000* (10000/15000) = 666.67
Member 2 = 1000* (5000/15000) = 333.33
The same way the unplanned depreciation is also allocated:
Member 1 = 12000* (10000/15000) = 8000
Member 2 = 12000* (5000/15000) = 4000
Thus total depreciation charged for the member assets are as follows:
=Allocated unplanned depreciation +monthly depreciation
Member 1 =8000+666.67 = 8667.67
Member 2 = 4000+333.33= 4333.33
Member 1
96
Member 2
Unplanned depreciation is charged as an expense for the group asset and the
allocated amount is also charged as an expense doe the member asset as well.
Though this just facilitates drill down of depreciation expense, the depreciation
will be posted to GL from the group asset level only.
13.6.1.2 Unplanned depreciation performed at Member level
The unplanned depreciation is added to the depreciation allocated from the group
asset. Whenever an unplanned depreciation is entered for the member asset a
validation happens as to whether the unplanned depreciation is more than the
NBV of the member asset.
For example:
Group A
Cost: 15000 (DPIS: Oct-2000)
Member 1
Cost: 10000 (DPIS: Oct-2000)
Member 2
Cost: 5000 (DPIS: Oct-2000)
Depreciation Method
Monthly
97

= (15000*0.80)/12
= 1000
In the second period (period counter 24011) an unplanned depreciation of 8333.33
is entered for Member1.Thus the group depreciation for the period is 9333.33 i.e.
8333.33 unplanned depreciation plus 1000 Monthly depreciation. The
depreciation is entered at the member asset level but the journal entry is posted
from the Group asset level only.
Group A
The net unplanned depreciation entered is 9000-666.67 that is 8333.33.

Depreciation basis)
Member 1 = 1000* (10000/15000) = 666.67
Member 2 = 1000* (5000/15000) = 333.33
= Unplanned depreciation entered for Member Asset +monthly depreciation
Member 1 =8333.33+666.67 = 9000
Member 2 = 0+333.33= 333.33
Though unplanned depreciation is entered for Member 1, it has no entry for the
unplanned depreciation in FA_adjustments.
98
Member 1
Member 2
Member 2 is not affected by the unplanned depreciation entered for the member 1.
The validation that happens for member asset while allocating depreciation
from the Group Asset
In Continuation of the above test case, an unplanned depreciation of 900 is done
for Group A.
Let us see what validations happen when the depreciation is allocated. Even if the
reduce excess is enabled for the Group asset, it will behave just like distribute
excess.
Group A
99
The depreciation for the group in the period is 1900 i.e. 900 unplanned
depreciation and 1000 monthly depreciation (period counter 24012).
Depreciation basis)
Member 1 = 1000* (10000/15000) = 666.67
Member 2 = 1000* (5000/15000) = 333.33
The same way the unplanned depreciation is also allocated:
Member 1 = 900* (10000/15000) = 600
Member 2 = 900* (5000/15000) = 300
Member 1
= Allocated unplanned depreciation+ monthly depreciation
Member 1 =600+666.7 = 1266.67.
After allocation of current period (period counter 24012) the member asset
reserve will be:
= 9666.67+1266.67
= 10933.34
The cost of Member asset is 10000.
Out of the unplanned depreciation of 600 to be allocated to the Member one only
333.33 can be allocated to member 1 as it is becoming fully reserved.
Thus excess depreciation allocated to member 1
=10933.34-10000
=933.34
100
Will be charged to member 2 in addition to the already allocated depreciation

amount.
Member 2 =(300+333.33)+933.37= 1566.67
Member 1
Member 2
Since the unplanned depreciation was 900 and out of which 333.33 was allocated
to member 1, remaining 900 less 333.33 that is 566.67 is allocated to member 2.
Thus despite the asset having reduce excess due to the unplanned depreciation
the validation happens similar to distribute excess. This means distributing the
excess depreciation to the remaining member of the group.
Member asset 2 is will be charged the full monthly depreciation calculated for the
group that is 1000 as well as the remaining unplanned depreciation (After
allocation of 333.33 to member 1) 566.67. Thus a total depreciation amount of
1566.67 is charged for member 2 for the current period (period counter 24012).
101
13.6.2 Calculate member amount

Unplanned depreciation can be entered for the group as well as the member when
the tracking method is set to calculate member amount. If sum up option is
enabled than unplanned depreciation cannot be entered at the group asset level.
For example:
Group A
Cost: 35000 (DPIS: Jan-2000)
Member 1
Cost: 10000 (DPIS: Jan-2000)
Member 2
Cost: 15000 (DPIS: Jan-2000)
Depreciation Method
Monthly
Tracking Method: calculate member amount
Depreciation method: Group Methods
Sum Member Asset Depreciation to Group checkbox is checked.
In this case the group A will not store any depreciation and depreciation will be
calculated at member level and stored thereof. The group asset will show only the
sum of member asset depreciation on the asset workbench.
Group A
The Monthly depreciation for Member 1 is

= (15000*0.60)/12
= 750
The Monthly depreciation for Member 2 is
=(Cost* Rate)/No of periods in a year
= (20000*0.60)/12
= 1000
An unplanned depreciation has been performed on Member 1 of 1500 in Jul-00
(Period counter 24007).
Member 1
The depreciation for the month of Jul-00 (Period counter 24007) is

= Unplanned depreciation + monthly depreciation
= 1500+750
= 2250
102
The member 2 or the Group A are unaffected by the unplanned depreciation

performed on Member 1.
Member 2
Group A
103
The depreciation charged for the member assets are as follows:

Member 1 = 2250
Member 2 = 1000
Depreciation will be posted to GL from member asset only. Thus the group A will
show 3250 for the period Jul-00 (Period Counter 24007) on the asset workbench
as well as inquiry form. Though this amount will not be visible at the table level
(fa_deprn_summary table). The sum up option will sum member asset
depreciation amounts and show it on the forms.
14 JOURNAL ENTRIES FOR GROUP ASSETS

In the group asset set up various attributes of an asset are divided among the group and its
member. Like cost is always booked at the member asset level while depreciation is
booked at the group asset level. Thus in a group asset set up the journal entries handled a
bit differently, to avoid double booking of the same amounts. The following section
explains how journal entries for group asset are created.
Cost is posted to GL from the member asset. The member asset stores the cost, as the
group asset cost is the total of the member asset cost. The cost adjustments also happen at
the member asset level.
For Example, in the retirement entry the cost side is posted from the member asset while
the rest of the lines in the journal entry go from the group asset. This is due to the fact
that reserve is posted from the group asset, thus reserve and NBV retired is calculated at a
group asset level.
104
The retirement of a member asset is a Group adjustment for the Group asset thus all other
lines except the cost line come with the transaction type of Group Adjustment. The cost
line has the transaction type of Full retirement
Group A
Member 1
FA_adjustments table in the member asset has the Cost line for retirement while the rest
of the entry is seen in the Group asset.
105
Depreciation journal is always posted to General Ledger at the group Asset level only. If
member tracking is enabled and tracking method is Allocate group amount than
depreciation figures might be allocated to the member assets but the journals will be
posted from the group asset only. No depreciation journal will be created for the member
asset.
The one exception to the above, is a situation when tracking method is calculate member
amount and sum member asset depreciation to group enabled. Here the depreciation
journal will be posted to General ledger at the member asset level.
For example: Take four group assets.
Group Asset Member Asset
Number
Number
DEPRN1
MEMDEPRN1
DEPRN2
MEMDEPRN2
DEPRN3
MEMDEPRN31
MEMDEPRN32
MEMDEPRN33
DEPRN4
MEMDEPRN41
MEMDEPRN42
Tracking method
Depreciation
the period
Member tracking not enabled
500
0
500
0
Allocate Group amount
2500
500
750
1250
Calculate Member asset
0
amount with sum up option
enabled
7500
1000
for
106
The above drill down report shows the depreciation charged for Feb-00 in the book.
DEPRN1 and DEPRN2 are group Assets, which do not have Member tracking enabled
While DEPRN3 has member tracking set to Allocate group amount. For all the three
groups the depreciation is posted to GL only at the Group asset level.
DEPRN4 has member asset tracking set to calculate member amount and sum up option
enabled. Here the depreciation is posted to GL only at the member asset level.
Besides the depreciation calculated via the depreciation engine there are two ways of
manually entering depreciation. They are depreciation override and unplanned
depreciation and are handled in the following sections.
14.1 Depreciation Override
Depreciation Override entered for the group asset is posted to GL at the level of the group
asset in all scenarios. Whether the Override has been entered for the group or the member
asset depreciation override is booked from the Group asset level only.
In the case where member tracking is set and sum up option is enabled, override is not
possible at the Group asset level thus it will be posted to GL from the member asset level
only.
For example: Take five group assets.
Group
Asset
Number
DEPRN1
Member
Number
Asset Tracking method

MEMDEPRN1
DEPRN2

MEMDEPRN2
DEPRN3

MEMDEPRN31
MEMDEPRN32
MEMDEPRN33
DEPRN4
Calculate
Member
asset
amount with sum up option
enabled
MEMDEPRN41
MEMDEPRN42
DEPRN5

MEMDEPRN51
MEMDEPRN52
Depreciation
the period
for
500
0
500
0
2500
500
750
1250
0
750
1000
1500
500
1000
107
An override of 7000 and 2000 respectively has been set for the Group asset DEPRN1 and
DEPRN2 while an override of 7500 is entered for member asset MEMDEPRN31.
The above drill down report shows the depreciation charged for May-00 in the book.
DEPRN1 and DEPRN2 have a depreciation override posted to GL of 7000 and 2000
respectively.
For the group asset DEPRN3 the override is entered for a member asset MEMDERPN31
for an amount of 7500.
The depreciation amount of 9500 posted to GL from the group asset DEPRN3 is
calculated as follows:
108
MEMDEPRN31
MEMDEPRN32
MEMDEPRN33
7500 (Override amount entered)

750 (Monthly amount allocated from the group depreciation of 2500)
1250 (Monthly amount allocated from the group depreciation of 2500)
--------9500
---------
14.2 Unplanned depreciation

Unplanned depreciation entered for the group asset is posted to GL at the level of the
group asset. Unplanned depreciation cannot be entered for the member asset if member
tracking is not enabled.
In the case Member tracking is enabled the unplanned depreciation is booked at the group
level only, irrespective of the fact that the unplanned has been entered for the group or
the member asset. There is only one exception to the above that is the case where
member tracking is set and sum up option is enabled. Here unplanned depreciation is not
possible at the Group asset level. Thus unplanned depreciation will be posted to GL from
the member asset level only.
The behavior of unplanned depreciation is a bit different only in the situation where the
member tracking is enabled and sum up option is not enabled.
There could be two cases here
1. Unplanned depreciation at group asset level (Refer Group All6 in example below)
2. Unplanned depreciation at member asset level. (Refer Group All7 in example
below)
For example: Take three group assets.
Group
Member
Asset No. Asset No.
ALL3
Tracking method
Member tracking
enabled
Depreciation
for the period
not
800
MEMAll3
ALL6

MEMALL61
MEMALL62
ALL7

MEMALL7
MEMALL72
0
1000
666.66
333.34
1000
666.66
333.34
Unplanned
depreciation
12000
8333.33
In the Month of Nov-00, unplanned depreciation of 12000 is entered for Group All6.
Allocation of Unplanned depreciation for Group ALL6 is as follows:
=Unplanned depreciation * (member asset depreciation basis/Group Assets
Depreciation basis)
MEMALL61 = 12000* (10000/15000) = 8000
MEMALL62 = 12000* (5000/15000) = 4000
109
ALL6
MEMALL61
MEMALL62
The unplanned depreciation entry comes as a debit to Expense account. But the same
debit is allocated to the member asset assets.
In the drilldown report (available only in 11i -- in R12, SubLedger Accounting views
present similar information), the unplanned depreciation will be shown on
JE_LINE_NUM 3 and the normal depreciation will be shown in JE_LINE_NUM 1. The
total depreciation posted for ALL6 is 13000, out of which 12000 is unplanned
depreciation and 1000 is monthly depreciation.
The drill down report will show the unplanned depreciation allocated to the member asset
amounts as well in JE_LINE_NUM 5 but the depreciation is only booked from the group
asset ALL6. This is due to the fact that the unplanned depreciation allocated to the
member asset also needs to be tracked.
110
Due to the member asset amounts also figuring in the drilldown report the batch total
seem to be mismatched but the journal entries are balanced as shown below:
This was a case where the unplanned depreciation is entered at the Group asset level but
the same can also be entered at the member Asset level. An unplanned depreciation for
8333.33 is entered for the member asset MEMALL7. This Asset belongs to the Group
ALL7. The unplanned depreciation will be charged only to MEMALL7 but the
depreciation will be posted to GL from the Group asset only.
111
ALL7
MEMALL7
MEMALL72
The unplanned depreciation entered for the MEMALL7 is a positive figure of 9000 and
than a negative unplanned depreciation was performed for 666.66 thus the net unplanned
depreciation will be 8333.33.
Thus we see two rows with amounts 8333.33 and 666.67 for the group asset. Besides that
there is a monthly depreciation of 1000 charged for the group asset. A total of 9333.33 is
charged for the group ALL7. And No drilldown is done at the member asset level, and
the unplanned depreciation amount is posted to GL at the group asset level.
112
Thus to summarize if the unplanned depreciation is entered at the group asset level it is
allocated to member asset in addition to the normal depreciation being allocated but the
journal is posted from the Group asset only. Though there is a drill down to the member
also in this case. But if the unplanned depreciation is entered at the member asset level it
is allocated to that member asset though the journal is posted from the group asset level
only and no drill is available to the member.
15 REPORTS
Only the following reports are enabled for Group Depreciation:
The exceptions are noted on the reports included below:
Group Asset Report
Asset Cost Balance Report*
Accumulated Depreciation Balance Report***
Reserve Ledger Report***
Retirements Report**
CIP Cost Balance Report*
Additions by Period Report*
Mass Additions Report
Cost Adjustments Report*
Transfers Report
What-if Depreciation Analysis
Cost Clearing Reconciliation Report*
Mass Reclassification Preview Report
Mass Reclassification Review Report
Mass Change Preview Report
Mass Change Review Report
113
*The member cost amounts are used in this report. Group asset cost is not displayed to
avoid potential user double counting of asset costs.
**This report only displays retired member assets. Group assets do not appear on this
report since group asset cannot be retired.
***This report only displays group asset accumulated depreciation amounts. Member
asset amounts do not appear on this report since only group asset amounts are
maintained and posted to General Ledger.
16 SUMMARY
16.1 Group Depreciation
Rules
1. Group Asset and its member assets must belong to the same book (either within
the same corporate book or same tax book).
2. Cost is stored and tracked at the member asset level and summarized to the group
asset.
Group asset cost = sum of member assetss cost.
3. Asset cost will be posted to GL from the member asset.
4. The Group Assets date placed in service is used to determine when
depreciation starts for the group. This date cannot be updated after depreciation
has started for the group asset. The members DPIS cannot be earlier than the
Groups.5. Depreciation rules defined for the group asset generally supersede
its member assets depreciation rules. Depreciation is generally calculated and
stored for the group asset only. However, if Member Asset Tracking is
enabled depreciation may also be tracked and stored at the member asset level. It
is only calculated at the member level if member tracking via Calculate is enabled.
6. Member assets can be stored with different categories, depreciation methods, etc
than their Group. Unless Member Asset Tracking is enabled with Calculate, this
will not result in any calculation impacts.
7. Depreciation expense is generally posted to GL from the Group asset only.
Account coding is taken from the Group Asset in this case. There is only one
exception here, if Member Asset Tracking is set to calculate member asset amount
and sum member asset depreciation to the group is enabled, the depreciation
expense will be posted to GL from the Member asset itself and will use member
coding.
8. Reserve is generally stored and tracked for the group asset only. There is usually
one reserve account for the group asset. Though there is only one exception here,
if Member Asset Tracking is set to calculate member asset amount and sum
member asset depreciation to the group is enabled. In this case there is going to be
one reserve account for every member asset in the group.
114
9. Member asset transactions (including addition, adjustment and group

reclassification) will be treated as a cost adjustment to the group asset. All
adjustment to the group asset will be treated as amortize adjustments to the group
asset, because expense adjustment is not possible for a group asset.
10. Both capitalized and CIP member assets may be added to a group asset.
However, cost of a CIP member asset will not be included in the group asset cost
until it has been capitalized. Only capitalized member assets costs are included
in the group assets cost. CIP member asset cost may be added to its group
assets depreciable basis if the Allow CIP Depreciation in Group Asset flag on the
Book Controls form and the Depreciate flag on the Source Line form are both
checked.
11. Unplanned depreciation can be entered for the Group Asset only if member
tracking is not enabled. It can be entered for the Group or Member Asset if
tracking is enabled.
12. The group asset may contain member assets with DPIS in different periods / years
(i.e. assets placed in service in disparate accounting periods).
13. A group asset cannot be deleted after a member asset is added to the group. The
member can also not be deleted. A group asset can be disabled if all the member
asset are either retired or reclassified out of the group and cost of the group asset is
zero.
14. Bonus Depreciation is not supported for Group or Member Assets.
15. Depreciation Projections is not supported for Group or Member Assets.
16. A Group Asset cannot be a parent or a child asset.
17. Member asset will inherit the retirement rules defined at the group asset.
Retirement rules include Recognize Gain and Loss, Recapture Excess Reserve,
Limit Net proceeds to Cost, and Terminal Gain and Loss.
18. Revaluation is not supported for Group or Member Assets.
19. Short Fiscal Year: Short fiscal year accounting is not currently supported for group
or member assets.
20. Depreciation ceiling functionality is not supported for Group or Member Assets.
21. Tax Reserve Adjustments are not supported for Group or Member Assets. Also, if
a tax reserve adjustment has been performed on a standalone asset, it cannot then
be reclassed to a Group.
22. Adding Group Assets to a Budget Book is not supported.
115
16 APPENDICES
16.1 Appendix 1: How to read the Group and Member asset traces?
The asset trace is now available from the front end. The Generate Asset Trace
concurrent program provides an insight into all the transaction and setups for an asset.
The asset trace gives us the full history of the asset, which helps us not only to check the
parameters but also to see the affects of the transaction performed on the asset as the table
level.
To be able to read the transactions performed on a group asset it is required to read the
group asset as well as member asset traces together. At times the same transaction can be
figuring in both the group as well its member assets. This section will help to guide how
to read the asset trace of the group and its memebr together.
A. How to find which asset trace is of a Group Asset or a Member Asset?
The FA_ADDITIONS_B table will show whether the asset is of the

ASSET_TYPE GROUP. The member assets will have the ASSET_TYPE as
CAPITALIZED.
B. How to find which Group asset does this member belong to?
The FA_BOOKS table has a GROUP_ASSET_ID field that stores the Group
asset to which this Member asset belongs.
C. At times a group may have many member assets attached to it. How to find which
transaction on the group asset is related to which member asset?
114
The Transaction_header_id 15559 for the group asset is the addition of the
member via transaction header id 15557. Similary the transaction header id 15582
for the group asset is the addition of the member asset via transaction header id
15560. This way we can find which transaction for the group asset was performed
on which member asset. Follow the same transaction header ids in the
FA_BOOKS table to find which field the transaction updates.
D. How to find the retirement and tracking options setup for the Group
asset?
In the FA_BOOKS table stores advance rules set up the group asset.
Retirement options arestored in the following fields:
RECOGNIZE_GAIN_LOSS: YES/NO
RECAPTURE_RESERVE_FLAG: Y/N
LIMIT_PROCEEDS_FLAG: Y/N
TERMINAL_GAIN_LOSS: YES/NO
Tracking options are stored in the following fields:
TRACKING_METHOD: ALLOCATE/CALCULATE
EXCESS_ALLOCATION_OPTION: REDUCE/DISTRIBUTE
ALLOCATE_TO_FULLY_RET_FLAG: Y/N
ALLOCATE_TO_FULLY_RSV_FLAG: Y/N
MEMBER_ROLLUP_FLAG: Y/N
Reduction rules are stored in the following fields:
REDUCTION_RATE
REDUCE_ADDITION_FLAG: Y/N
REDUCE_ADJUSTMENT_FLAG: Y/N
REDUCE_RETIREMENT_FLAG: Y/N
115
116
E. Which table to look for if a backdated transaction has been performed on the
group asset and not able to figure out the depreciation calculation?
stores group assets' periodical financial information.
All group financial information changes, such as group additions, adjustments,
member asset addition, member asset adjustments, member asset retirements,
group reclassifications, and unplanned depreciations, will result in maintaining
this table. This table stores the latest group asset information for each period. This
means that any retroactive adjustment will result in updating multiple records for
that group asset to reflect the latest changes to old periods. This Table will show
the affect on FA tables if the backdated transaction was actually performed on the
date effective in the prior period. Thus helping in figuring out how complex group
depreciation calculation are done by the application.
FA_BOOKS_SUMMARY table
The rest of the tables are same as for standalone assets. In case there is a data corruption
in the group asset, fixes are needed for the group as well as the member asset. Generic fix
does not work for group asset or its member Assets.
117
16.2 Appendix 2: New Tables Created for Group asset

FA_BOOKS_SUMMARY
This table stores group assets' periodical financial information. All group financial
information changes, such as group additions, adjustments, member asset addition,
member asset adjustments, member asset retirements, group reclassifications, and
unplanned depreciations, will result in maintaining this table. This table stores the latest
group asset information for each period. This means that any retroactive adjustment will
result in updating multiple records for that group asset to reflect the latest changes to old
periods.
118

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ORACLE APPLICATIONS

Group Depreciation White Paper Ver 1.0

A GLOBAL PERSPECTIVE ..................................................................................... ................... 6

SETUP ............................................................................................................................. ............ 16

GROUP ASSET SET UP AT BOOK CONTROLS LEVEL FOR CORPORATE BOOK.............................. 16

Advanced rules tab: Retirement options. .......................................................................... 27

Advanced rules tab: Tracking options .............................................................................. 35

Allocate Group Amount ........................................................................................................ 36

MEMBER ASSET ADDITION ................................................................................................. . 46

MEMBER ASSET ADDITION VIA DETAIL ADDITION ON ASSET WORKBENCH ............................... 46

DISABLING GROUP ASSETS .................................................................................................. 50

QUERYING A GROUP ASSET ON THE ASSET WORKBENCH OR INQUIRY FORMS... 52

ONE TIME ENTRY AND UPDATABLE PARAMETERS ....................................................... 55

GROUP ASSET ...................................................................................................................... . 55

ASSIGNING MEMBER ASSET COST TO THE GROUP ....................................................... 60

CURRENT PERIOD MEMBER ADDITION .................................................................................... 60

Group Depreciation White Paper Ver 1.0

ADDING A GROUP OR A MEMBER ASSET WITH RESERVE ........................................... 67

CIP MEMBER ASSET ADDITION ............................................................................................ . 66

ADDING A GROUP ASSET WITH RESERVE ................................................................................. 67

Allocate Group Amount with Distribute Excess .....................................................................73

Calculate member amount.......................................................................................... . 81

Group amount override .........................................................................................................91

Unplanned depreciation performed at group level...................................................................95

Calculate member amount.......................................................................................... 102

JOURNAL ENTRIES FOR GROUP ASSETS..........................................................................104

DEPRECIATION OVERRIDE .................................................................................................... 107

SUMMARY ...................................................................................................................... ..........114

GROUP DEPRECIATION RULES.............................................................................................. 116

APPENDICES ................................................................................................... .........................116

Group Depreciation White Paper Ver 1.0

Group Depreciation White Paper Ver 1.0

Group Depreciation White Paper Ver 1.0

In many countries, Accounting Principles and Tax regulations require depreciation to be

Group Depreciation White Paper Ver 1.0

It is not required to claim the

Group, selected Group assets into

Group Depreciation White Paper Ver 1.0

This is done via entering Override depreciation at

Select the transfer type ENTER to enter the

Super Group. Refer Super Group for more details

Group Depreciation White Paper Ver 1.0

basis of the Group.

Refer Advanced rules: Reduction rules and

How Group Asset meets these requirements?

Group Depreciation White Paper Ver 1.0

depreciation needs to be calculated

enable Allocate to fully retired or reserved

Enable the ability to restrict member

Depreciation limit can be set at member level

Deduction of salvage value from

Gain and loss need to be recognized

Group Depreciation White Paper Ver 1.0

Select depreciation basis rule Flat rate

For the tracking method Calculate Member

Controls level for Corporate Book.

How Group Asset meets these requirements?

Group Depreciation White Paper Ver 1.0

Group Depreciation White Paper Ver 1.0

Select the transfer type ENTER and enter the

What-IF analysis can be used for group

Group Depreciation White Paper Ver 1.0