Financials Cloud – Fixed Assets

GSI Fusion Fixed Assets – Impairment

Himangi.lokre

Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal
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information purposes only, and may not be incorporated into any contract. It is not a
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in making purchasing decisions. The development, release, and timing of any features or
functionality described for Oracle’s products remains at the sole discretion of Oracle.

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Demo Attributes
Product(s) Financials- Fixed Assets

Date Last Updated 16th Apr 2018

Author(s) Himangi.Lokre

GSE Demo Release(s) Supported Fusion Rel 13 HRZ18AD01

Demo Title(s) Fusion GSI - ERP, SCM, HCM, Student & Engagement Cloud

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Executive Summary
Impairment of Assets is intended to ensure that assets are carried at no more than their
recoverable amount. An asset is impaired when its carrying amount exceeds its
recoverable amount (the greater of its net selling price & its value in use). These elements
are defined as:

• Recoverable amount: Is the higher of an asset's Net Selling Price and its Value in Use.
• Net Selling Price (NSP): The amount obtainable from the sale of an asset in a bargained
transaction between knowledgeable, willing parties less the costs of disposal
• Value in use (VIU): Is the present value of estimated future cash flows expected to arise
from the continuing use of an asset, and from its disposal at the end of its useful life

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Executive Summary
Whilst all assets are required to be reviewed for impairment indicators, only assets that
are identified as ‘potentially impaired’ require an impairment assessment.
IAS 36 has a list of external & internal indicators of impairment. If there is an indication
that an asset may be impaired, then the enterprise is required to calculate the asset’s
recoverable amount.
The following may indicate that an asset is impaired:
External sources:
• Market value declines
• Negative changes in technology, markets, economy, or laws
• Increases in market interest rates or other rates of return on investments
• Company stock price is below book value

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Executive Summary

Internal sources:
• Obsolescence or physical damage
• Asset becomes idle
• Asset is part of a restructuring or held for disposal
• Worse economic performance than expected

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Executive Summary
ERP Cloud Assets allows to focus on increasing user productivity by
optimizing the user interfaces and focusing on a business process oriented
approach.
• Optimized user interface leveraging an excel spreadsheet
• Increased user productivity – the Impairment process is quite research
intensive – the user has to determine the Net Selling Price (NSP) and/or
value in use (VIU) for the impaired assets. This may require the use of third-
party consulting companies that can survey the market conditions/price for
these assets. ERP Cloud assets allows you to enter this data in the
“preview” mode while waiting for all details. Once you have the final
numbers regarding VIU/NSP, AND you have reviewed the data, you can
then post these transactions to your books

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Storyline and Personas
• Asset manager will perform impairment of assets

Demo User Login Book

Fanta.Jabara US CORP
Corrine.Beaulieu VISION FRANCE COMPATIBLE
Jenny.Humphries UK CORP
Brian.Bell UNIVERSITY US CORP
Bettina.Calan HC US CORP

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Demo Setup
• Ensure that Impairment Expense and Reserve are setup on the Asset Category to be impaired.
Navigation> Login as Fin_impl> Set up and Maintenance> Select Financials> Search for “Manage Asset
Categories”> Click on the asset category to be used for demo

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As Assets Manager, Fanta is required to ensure that assets are carried at no more than their recoverable amount.

[ Login as Fanta.Jabara > Click on Fixed Assets > Assets ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 10
She observes that asset #111884 needs to be impaired.

[ Click on task > click impair assets ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 11
Fanta creates a transaction group to impair assets

[ Click plus sign > click next ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 12
She connects to the URL

[ Click on Yes to connect to the URL ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 13
She logins with password

[ Enter username with password ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 14
Fanta enters the required details to impair assets
Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal
[ Asset Number: 111884 > Impairment Status: Preview > Net Selling Price: 1,000,00.00 > Comments: Fire Damage (optional) > Click Submit ] 15
Fanta confirms the submission

[ Click ok > click ok on confirmation ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 16
She returns to the Impair assets window to review and post the batch

[ Enter Transaction group name and click search > click post ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 17
Fanta enters yes to the warning

[ Click Yes > click ok on confirmation ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 18
She moves ahead to create accounting for this transaction

[ Click task pane > create accounting ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 19
She enters required details

[ Click submit > click ok on confirmation ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 20
Fanta inquires to view Impairment transaction

[ Select Asset Inquiry > go to transactions > click search > select your asset numberCopyright
> click© view
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accounting] | Confidential – Oracle Internal 21
Fanta checks the Gain/Loss entries

[ Click T- Accounts ] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 22
Fanta is assured that the accounting looks good .

[ Click done] Copyright © 2017, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal 23