Standard depreciation method description > Attached document: Spanish standard depreciation method description
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Spanish standard depreciation method description
This document is an appendix to the documentation on the setup of Depreciation methods.
In standard, Sage X3 comes with a number of depreciation methods.
Some are associated with a given legislation, while others are common to all legislations.
This document describes the calculation principles of the depreciation methods associated with the Spanish legislation.
- LE - Spanish straight-line months
- SL - Spanish straight-line days
- DE - Spanish declining
- DI - Spanish mixed declining
The other methods are described in appendix documentations, which can be accessed from the documentation on the depreciation methods common to all legislations.
LE - Spanish straight-line months
It is the straight-line depreciation method applied according to Spanish rules.
Depreciation origin
The origin is the 1st day of the month entered in the depreciation start date.
Duration
The user can specify either the duration, or the rate.
If the duration is specified by the user, Sage X3 automatically determines the depreciation rate as well as the depreciation end date based on this duration.
The duration is expressed in years and hundredths of years.
For example : 6,66 or 6,67 for a duration of 6 years 2/3.
Rate
The rate can be specified by the user.
In this case, Sage X3 determines the depreciation duration based on the rate entered.This determined duration will be used to calculate the depreciation end date.
If the depreciation rate is not specified by the user, Sage X3 will determine it as follows:1 / duration with a rounding on the 4th decimal.
Examples:
Depreciation duration | Depreciation rate |
1 year | 100% |
2 years | 50% |
3 years | 33.33% |
4 years | 25% |
5 years | 20% |
6 years | 16.67% |
6 years 2/3 (6,66 or 6,67) | 15% |
8 years | 12.50% |
10 years | 10% |
12 years | 8.33% |
15 years | 6.67% |
20 years | 5% |
Depreciation end date
It is determined as follows:
1st day of the month entered as Depreciation start date + depreciation duration
This end date is adjusted on the last day of the month.
Examples:
Start date | Duration | End date |
1/1/2005 | 5 years | 12/31/09 |
7/1/2005 | 5 years | 6/30/2010 |
3/14/2005 | 5 years | 2/28/2010 |
1/1/2005 | 6.66 | 8/31/2011 |
Prorata temporis
Time is expressed in months or weeks.
By default, it is expressed in months; to be expressed in weeks, it is necessary to activate the Prorata temporis in weeks flag, at Context management level.
A prorata temporis is applied in the following cases:
During the acquisition fiscal year, if the depreciation originis not the 1st day of the fiscal year.
- If the duration of a fiscal year differs from 12 months.
During the disinvestment fiscal year: the charge is calculated until the disposal day if it is the last of the month; otherwise, the charge is calculated until the end of the month that precedes the disposal.
This rule can be modified by Disposal rules: Disposal at the end of the previous FY and Disposal at the end of the current FY.
Depreciation charge
The depreciation expenditure is calculated in the following way :
Depreciation value * Depreciation rate * prorata temporis
A prorata temporis in months or in weeks is applied in the following cases:
- The Depreciation start date is beyond the fiscal year start date
- The fiscal year Duration differs from 12 months
- The Disposal date of the asset is in the interval [Fiscal year start date – Fiscal year end date]
Notes:
- Depreciable value = Gross value – Residual value
- Net depreciable value = Net value – Residual value
- If the depreciation end date is earlier or equal to the fiscal year end date, the fiscal year charge will automatically be loaded with the net depreciable value, so as to close the depreciation.
Distribution of the fiscal year charge on the periods
If the fiscal year is divided into several periods, the fiscal year charge is distributed over these periods as follows:
Period Charge pc =
Fiscal year charge
*
( Σ p1 to pc ( (Period weight / Number of months or weeks in the period) * Number of holding months or weeks in the period )
/
Σ p1 to pc ( (Period weight / Number of months or weeks in the period) * Number of holding months or weeks in the period ) )
-
Depreciation total of previous periods
p1 to pc = from the 1st holding period in the fiscal year to the current period included (1)
p1 to pf = from the 1st holding period in the fiscal year to the last holding period in the fiscal year
(1) Unless the asset is issued in the fiscal year before this current period or if it is completely depreciated in the fiscal year before this current period. The retained period thus is the minimum one among the 3 following ones:
- period of depreciation end if the Depreciation end date belongs to the interval [period start – period end]
- disposal period if the Disposal date belongs to the interval [period start – period end]
- current period
Examples:
1st example
- Gross value: 10,000
- Residual value: 0
- Depreciation start date: 11/5/2005
- Depreciation duration: 5 years, Rate: 20% --> Depreciation end date: 10/31/2010
Fiscal year
Net value
Fiscal year charge
Fiscal year total
1/1/2005 – 12/31/2005
10,000.00
(1) 333 .33
333.33
1/1/2006 – 12/31/2006
9,666.67
2,000.00
2,333.33
1/1/2007 – 12/31/2007
7,666.67
2,000.00
4,333.33
1/1/2008 – 12/31/2008
5,666.67
2,000.00
6,333.33
1/1/2009 – 12/31/2009
3,666.67
2,000.00
8,333.33
1/1/2010 – 12/31/2010
1,666.67
(2) 1,666.67
10,000.00
(1) 10,000.00 * 20% * 2/12 since the asset is held for only 2 months during this 1st fiscal year.
(2) The depreciation end date 10/31/2010 is to be found in this fiscal year, which means that the depreciation is closed.
2nd example
- Gross value:10,000
- Residual value:+ 0
- Depreciation start date:2/28/2005
- Depreciation duration:6.66 years, Rate:15% --> Depreciation end date:9/30/2011
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00 | (1) 1,375.00 | 1,375.00 |
1/1/2006 – 12/31/2006 | 8,625.00 | 1,500.00 | 2,875.00 |
1/1/2007 – 12/31/2007 | 7,125.00 | 1,500.00 | 4,375.00 |
1/1/2008 – 12/31/2008 | 5,625.00 | 1,500.00 | 5,875.00 |
1/1/2009 – 12/31/2009 | 4,125.00 | 1,500.00 | 7,375.00 |
1/1/2010 – 12/31/2010 | 2,625.00 | 1,500.00 | 8,875.00 |
1/1/2011 – 12/31/2011 | 1,125.00 | (2) 1,125.00 | 10,000.00 |
(1) 10,000.00 * 15% * 11/12 since the asset has been held for 11 months during this 1st fiscal year.
(2) The depreciation end date 9/30/2011 is to be found in this fiscal year, which means that the depreciation is closed.
3rd example
- Gross value:10,000
- Residual value:+ 0
- Depreciation start date:2/28/2005
- Depreciation duration:6.66 years, Rate:15% --> Depreciation end date:9/30/2011
- Disposal date:5/4/2008
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00/ | (1) 1,375.00 | 1,375.00/ |
1/1/2006 – 12/31/2006 | 8,625.00/ | 1,500.00/ | 2,875.00/ |
1/1/2007 – 12/31/2007 | 7,125.00/ | 1,500.00/ | 4,375.00/ |
1/1/2008 – 12/31/2008 | 5,625.00/ | (2) 500.00 | 4,875.00/ |
(1) 10,000.00 * 15% * 11/12 since the asset has been held for 11 months during this 1st fiscal year.
(2) 10 000,00 * 15% * 4/12th = 500,00 for the asset has been held for 4 months during this fiscal year.
Distribution of the 2005 fiscal year charge based on the period weight in months:
Period | Number of months / Weight | Number of holding months | Charge |
1/1/2005 – 3/31/2005 | 03 / 03 | 02/ | (3) 275.00 |
4/1/2005 – 6/30/2005 | 03 / 03 | 03/ | (4) 412.50 |
7/1/2005 – 9/30/2005 | 03 / 02 | 03/ | (5) 275.00 |
10/1/2005 – 12/31/2005 | 03 / 03 | 03/ | (6) 412.50 |
Fiscal year 2005 total | 1,375.00/ | ||
(3) 1,375.00 * (03 / 03 * 02) / [(03 / 03 * 02) + (03 / 03 * 03) + (02 / 03 * 03) + (03 / 03 * 03) ] = 275.00
(4) 1,375.00 * [ (03 / 03 * 02) + (03 / 03 * 03) ]
/ [ (03 / 03 * 02) + (03 / 03 * 03) + (02 / 03 * 03) + (03 / 03 * 03) ] = 687.50 – 275.00 = 412.50
(5) 1,375.00 * [ (03 / 03 * 02) + (03 / 03 * 03) + (02 / 03 * 03) ]
/ [ (03 / 03 * 02) + (03 / 03 * 03) + (02 / 03 * 03) + (03 / 03 * 03) ] = 962.50 – 687.50 = 275.00
(6) 1,375.00 * [ (03 / 03 * 02) + (03 / 03 * 03) + (02 / 03 * 03) + (03 / 03 * 03) ]
/ [ (03 / 03 * 02) + (03 / 03 * 03) + (02 / 03 * 03) + (03 / 03 * 03) ] = 1,375.00 – 962.50 = 412.50
4th example
- Gross value:10,000
- Residual value:+ 0
- Depreciation start date:2/28/2005
- Depreciation duration:6.66 years, Rate:15% --> Depreciation end date:9/30/2011
- Specificity:Prorata temporis expressed in weeks
- Disposal date:5/4/2008
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00/ | (1) 1,384.62 | 1,384.62/ |
1/1/2006 – 12/31/2006 | 8,615.38/ | 1,500.00/ | 2,884.62/ |
1/1/2007 – 12/31/2007 | 7,115.38/ | 1,500.00/ | 4,384.62/ |
1/1/2008 – 12/31/2008 | 5,615.38/ | (2) 490.38 | 4,875.00/ |
(1) 10 000,00 * 15% * 48/52th for the asset has been held for 48 weeks during this 1st fiscal year.
(2) 10 000,00 * 15% * 17/52th = 490.38 for the asset has been held for 17 weeks during this fiscal year
Distribution of the 2005 fiscal year charge based on the period weight in weeks:
Period | Number of weeks / Weight | Number of holding weeks | Charge |
1/1/2005 – 3/31/2005 | 13 / 13 | 09/ | (3) 283.22 |
4/1/2005 – 6/30/2005 | 13 / 13 | 13/ | (4) 409.09 |
7/1/2005 – 9/30/2005 | 13 / 09 | 13/ | (5) 283.22 |
10/1/2005 – 12/31/2005 | 13 / 13 | 13/ | (6) 409.09 |
Fiscal year 2005 total | 1,384.62/ | ||
(3) 1,384.62 * (13 / 13 * 09) / [(13 / 13 * 09) + (13 / 13 * 13) + (09 / 13 * 13) + (13 / 13 * 13) ] = 283.22
(4) 1,384.62 * [ (13 / 13 * 09) + (13 / 13 * 13) ]
/ [ (13 / 13 * 09) + (13 / 13 * 13) + (09 / 13 * 13) + (13 / 13 * 13) ] = 692.31 – 283.22 = 409.09
(5) 1,384.62 * [ (13 / 13 * 09) + (13 / 13 * 13) + (09 / 13 * 13) ]
/ [(13 / 13 * 09) + (13 / 13 * 13) + (09 / 13 * 13) + (13 / 13 * 13) ] = 975.53 – 692.31 = 283.22
(6) 1,384.62 * [ (13 / 13 * 09) + (13 / 13 * 13) + (09 / 13 * 13) + (13 / 13 * 13) ]
/ [ (13 / 13 * 09) + (13 / 13 * 13) + (09 / 13 * 13) + (13 / 13 * 13) ] = 1,384.62 – 975.53 = 409.09
SL - Spanish straight-line days
It is the straight-line depreciation method applied according to Spanish rules.
Depreciation origin
The depreciation is calculated from the day of effective first use of each depreciable element onwards; hence, Sage X3 retains the day specified as depreciation start date.
Duration
The user can specify the duration and/or the rate.
If the duration is specified by the user, Sage X3 automatically determines the depreciation rate as well as the depreciation end date based on this duration.
If the rate is specified, the depreciation duration is automatically determined based on the entered rate. When duration and rate are specified, the rate takes priority.The default value for this management rule is "Priority to the rate", specified in the method setup.
The duration is expressed in years and thousandths of years.
For example : 6,666 or 6,667 for a duration of 6 years 2/3.
Rate
The rate can be specified by the user.
In this case, Sage X3 determines the depreciation duration based on the rate entered.This determined duration will be used to calculate the depreciation end date.
If the depreciation rate is not specified by the user, Sage X3 will determine it as follows:1 / duration rounded to the 6th decimal to be displayed on the depreciation plan.The rate used for the calculation is not rounded.
Depreciation end date
The depreciation end date is equal to:
Depreciation launch day + depreciation duration.
Examples:
Start date | Duration | End date |
1/1/2012 | 5 years | 12/31/2016 |
7/1/2012 | 5 years | 6/30/2017 |
3/14/2012 | 5 years | 3/13/2017 |
1/1/2012 | 6.667 | 8/31/2018 |
7/1/2012 | 3.333 | 10/31/2015 |
3/14/2012 | 3.333 | 7/13/2015 |
|
|
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Prorata temporis
The prorata temporis is expressed in days. It is applied in the following situations:
- During the acquisition fiscal year, if the depreciation start date is not the first day of the fiscal year.
- If the fiscal year duration differs from 1 year.
- During the disinvestment fiscal year: the charge is calculated until disposal day.
This rule can be modified by Disposal rules: Disposal at the end of the previous FY, Disposal at the end of the current FY and No depreciation charge on the disposal day
Depreciation charges
The fiscal year charge is equal to:
Depreciable value * Depreciation rate * prorata temporis in days
Notes:
- Depreciable value = (Gross value – Residual value)
- Gross value = Depreciation basis
- If the option Priority to the rate is not specified at Depreciation method setup level, the depreciation end date has priority over the rate. In this case, if the depreciation end date is in the calculated period or fiscal year, the depreciation is closed. Net value - Residual value.
Distribution of the fiscal year charge on the periods
If the fiscal year is divided into several periods, the fiscal year charge is distributed over these periods as follows:
Period Charge pc =
Fiscal year charge
*
*( Σ p1 to pc ( (Period weight / Number of days in the period) * Number of days in the period )
/
Σ p1 to pf ( (Period weight / Number of days in the period) * Number of holding days in the period ) ]
-
Depreciation total of previous periods
p1 to pc = from the 1st holding period in the fiscal year to the current period included (1)
p1 to pf = from the 1st holding period in the fiscal year to the last holding period in the fiscal year
(1) Unless the asset is issued in the fiscal year before this current period or if it is completely depreciated in the fiscal year before this current period. The retained period thus is the minimum one among the 3 following ones:
- period of depreciation end if the Depreciation end date belongs to the interval [period start – period end]
- disposal period if the Disposal date belongs to the interval [period start – period end]
- current period
If the depreciation end date is inferior to the fiscal year end date, and at least one FCY charge superior to 0 exists, it is completely posted into the first FY period.This case may occur if the Priority to the rate option is specified for the depreciation method setup.
Examples:
1st example
- Gross value: 10,000
- Residual value: 0
- Depreciation start date: 05/11/2005
- Depreciation duration: 5 years, Rate: 20% --> Depreciation end date: 04/11/2010
- Specificity: the second fiscal year has a duration of 6 months
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00 | (1) 312.3 | 312.33 |
1/1/2006 – 6/30/2006 | 9,687.67 | (2) 991.78 | 1,304.11 |
7/1/2006 – 6/30/2007 | 8,695.89 | 2,000.00 | 3,304.11 |
7/1/2007 – 6/30/2008 | 6,695.89 | 2,000.00 | 5,304.11 |
7/1/2008 – 6/30/2009 | 4,695.89 | 2,000.00 | 7,304.11 |
7/1/2009 – 6/30/2010 | 2,695.89 | 2,000.00 | 9,304.11 |
7/1/2010 – 6/30/2011 | 695.89 | 695.89 | 10,000.00 |
(1) 10,000.00 * 20% * 57/365 since the asset is held only for 57 days during this 1st fiscal year.
(2) 10,000.00 * 20% * 181/365 since the duration of this 2nd fiscal year is 6 months = 181 days.
2nd example
- Gross value: 10,000
- Residual value: 0
- Depreciation start date: 2/28/2005
- Depreciation duration: 6.67 years. Rate: 15 % --> Depreciation end date: 10/27/2011
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00 | (1) 1,261.64 | 1,261.64 |
1/1/2006 – 12/31/2006 | 8,738.36 | (2) 1,500.00 | 2,761.64 |
1/1/2007 – 12/31/2007 | 7,238.36 | 1,500.00 | 4,261.64 |
1/1/2008 – 12/31/2008 | 5,738.36 | 1,500.00 | 5,761.64 |
1/1/2009 – 12/31/2009 | 4,238.36 | 1,500.00 | 7,261.64 |
1/1/2010 – 12/31/2010 | 2,738.36 | 1,500.00 | 8,761.64 |
1/1/2011 – 12/31/2011 | 1,238.36 | 1,238.36 | 10,000.00 |
(1) 10,000.00 * 15% * 307/365 since the asset has been held for 307 days during this 1st fiscal year.
(2) 10,000.00 * 15% = 1,500.00
3rd example
- Gross value: 10,000
- Residual value: 0
- Depreciation start date: 2/28/2005
- Depreciation duration: 6.67 years. Rate: 15 % --> Depreciation end date: 10/27/2011
- Disposal date: 04/05/2008
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00 | (1) 1,261.64 | 1,261.64 |
1/1/2006 – 12/31/2006 | 8,738.36 | 1,500.00 | 2,761.64 |
1/1/2007 – 12/31/2007 | 7,238.36 | 1,500.00 | 4,261.64 |
1/1/2008 – 12/31/2008 | 5,738.36 | (2) 512.30 | 4,773.94 |
(1) 10,000.00 * 15% * 307/365 since the asset has been held for 307 days during this 1st fiscal year.
(2) 10 000,00 * 15% * 125/366 = 512.30 for the asset has been held for 125 days during this fiscal year
4th example
- Gross value: 10,000
- Residual value: 0
- Depreciation start date: 6/1/2005
- Depreciation duration: 4 years. Rate: 25 % --> Depreciation end date: 5/31/2009
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00 | (1) 1,465.75 | 1,465.75 |
1/1/2006 – 12/31/2006 | 8,534.25 | 2,500.00 | 3,965.75 |
1/1/2007 – 12/31/2007 | 6,034.25 | 2,500.00 | 6,465.75 |
1/1/2008 – 12/31/2008 | 3,534.25 | 2,500.00 | 8,965.75 |
1/1/2009 – 12/31/2009 | 1,034.25 | 1,034.25 | 10,000.00 |
(1) 10,000.00 * 25% * 214/365 since the asset has been held for 214 days during this 1st fiscal year.
Distribution of the 2005 fiscal year charge based on the weight of the periods:
Period | Number of days / Weight | Number of holding days | Depreciation charge |
1/1/2005 – 3/31/2005 | 90 / 90 | 0 | 0.00 |
4/1/2005 – 6/30/2005 | 91 / 90 | 30 | (2) 242.05 |
7/1/2005 – 9/30/2005 | 92 / 60 | 92 | (3) 489.48 |
10/1/2005 – 12/31/2005 | 92 / 90 | 92 | (4) 734.22 |
Fiscal year 2005 total | 1,465.75 | ||
(2) 1,465.75 * (90 / 91 * 30) / [ (90 / 91 * 30) + (60 / 92 * 92) + (90 / 92 * 92) ] = 242.05
(3) 1,465.75 * [ (90 / 91 * 30) + (60 / 92 * 92) ]
/ [ (90 / 91 * 30) + (60 / 92 * 92) + (90 / 92 * 92) ] = 731.53 - 242.05 = 489.48
(4) 1,465.75 * [ (90 / 91 * 30) + (60 / 92 * 92) + (90 / 92 * 92) ]
/ [ (90 / 91 * 30) + (60 / 92 * 92) + (90 / 92 * 92) ] = 1,465.75 - 731.53 = 734.22
DE - Spanish declining
It is the declining depreciation method applied according to Spanish rules: this depreciation method thus meets the Spanish accounting and fiscal standards.
It differs from the Spanish mixed declining depreciation method as the depreciation schedule end when the depreciation end date is detected.
Depreciation origin
The declining depreciation origin is the day entered in the depreciation start date.
Duration
It must be entered by the user, in years and hundredths of years.
Example: 6 years 2/3 = 6,66 or 6,67.
For this depreciation method, Sage X3 will round to 2 decimals all the durations entered or imported with more than 2 decimals.Ditto for residual durations calculated in the framework of intra-group sales.
Rate
The rate that can be applied to the declining depreciation calculation can neither be entered, not determined by field associations.
It is automatically determined by Sage X3 by multiplying the straight-line depreciation rate corresponding to the standard use duration of the fixed asset by a changeable coefficient based on this duration.
This changeable coefficient is called declining coefficient and varies based on the depreciation duration:
- Duration < 5 years --> Coefficient = 1,5
- Duration = 5 years and < 8 years --> Coefficient = 2
- Duration = 8 years --> Coefficient = 2,5
The calculated depreciation rate is rounded to 2 decimals.
Examples:
Duration | Declining rate |
3 years | (1 / 3) * 1.5 = 50% |
4 years | (1 / 4) * 1.5 = 37.50% |
5 years | (1 / 5) * 2 = 40% |
6 years | (1 / 6) * 2 = 33.33% |
6,66 or 6,67 | (1 / 6.666666) * 2 = 30.00% |
7 years | (1 / 7) * 2 = 28.57% |
8 years | (1 / 8) * 2.5 = 31.25% |
10 years | (1 / 10) * 2.5 = 25% |
12 years | (1 / 12) * 2.5 = 20.83% |
15 years | (1 / 15) * 2.5 = 16.67% |
20 years | (1 / 20) * 2.5 = 12.5% |
Depreciation end date
It is determined as follows:
Depreciation start date + Depreciation duration
Example 1:
Depreciation start date = 12/5/2005
Duration = 3 years
Depreciation end date = 12/4/2008
Example 2:
Depreciation start date = 1/1/2005
Duration = 5 years
Depreciation end date = 12/31/2009
Prorata temporis
Time is expressed in days.
A prorata temporis always expressed in days applies in the following cases:
During the acquisition fiscal year, if the depreciation origin is not the first day of the fiscal year.
If the duration of a fiscal year differs from 12 months.
During the disinvestment fiscal year: the charge is calculated until disposal day. This rule can be modified by Disposal rules: No depreciation expenditure on issue day, Prevous fiscal year end issue and Cuurent fiscal year end issue.
Depreciation charges
- The depreciation charge of the 1st fiscal year is equal to:
Depreciable value * declining rate * prorata temporis
A Prorata temporis in days is applied in the following cases:
- The Depreciation start date is beyond the fiscal year start date
- The fiscal year Duration differs from 12 months
- The Disposal date of the asset is in the interval [Fiscal year start date – Fiscal year end date]
- The depreciation charge of the next fiscal years is equal to:
Net depreciable value at fiscal year start * rate * prorata temporis
A Prorata temporis in days is applied in the following cases:
- The fiscal year Duration differs from 12 months
- The Disposal date of the asset is in the interval [Fiscal year start date – Fiscal year end date]
If the depreciation end date belongs to the interval [FY start date – FY end date], the FY charge equals to net depreciation value at FY start, in order to close the depreciation..
A prorata temporis is then applied to this FY charge in the following situations:
- The Disposal date of the asset is in the interval [Fiscal year start date – Fiscal year end date]
and
- The Disposal date is earlier than the Depreciation end date
Notes:
- Depreciable value = Gross value – Residual value
- Net depreciable value = Net value – Residual value
Distribution of the fiscal year charge on the periods
If the fiscal year is divided into several periods, the fiscal year charge is distributed over these periods as follows:
Period Charge pc =
Fiscal year charge
*
( Σ p1 to pc ( (Period weight / Period number of days) * Number of holding days in the period )
/
( Σ p1 to pf ( (Period weight / Period number of days) * Number of holding days in the period )
-
Depreciation total of previous periods
p1 to pc = from the 1st holding period in the fiscal year to the current period included (1)
p1 to pf = from the 1st holding period in the fiscal year to the last holding period in the fiscal year
(1) Unless the asset is issued in the fiscal year before this current period or if it is completely depreciated in the fiscal year before this current period. The retained period thus is the minimum one among the 3 following ones:
- period of depreciation end if the Depreciation end date belongs to the interval [period start – period end]
- disposal period if the Disposal date belongs to the interval [period start – period end]
- current period
Examples:
1st example
- Gross value: 10,000
- Residual value: 0
- Depreciation start date: 15/09/2005
- Depreciation duration: 5 years, Rate: 40 %
- Depreciation end date: 9/14/2010
(1) 10,000.00 * 40% * 108/365 since the asset is held only for 108 days during this 1st fiscal year.
(2) 8,816.44 = 40%
(3) Fiscal year charge = Net value since the depreciation end date 9/14/2010 is to be found in the fiscal year
2nd example
- Gross value:10,000
- Residual value:0
- Depreciation start date:9/15/2005
- Depreciation duration:5 years, Rate:40 %
- Depreciation end date:9/14/2010
- Asset disposal date:1/10/2010
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00/ | (1) 1,183.56 | 1,183.56/ |
1/1/2006 – 31/12/2006 | 8,816.44/ | (2) 3,526.58 | 4,710.14/ |
1/1/2007 – 12/31/2007 | 5,289.86/ | 2,115.94/ | 6,826.08/ |
1/1/2008 – 12/31/2008 | 3,173.92/ | 1,269.57/ | 8,095.65/ |
1/1/2009 – 12/31/2009 | 1,904.35/ | 761.74/ | 8,857.39/ |
1/1/2010 – 12/31/2010 | 1,142.61/ | (3) 44.46 | 8,901.95/ |
(1) 10,000.00 * 40% * 108/365 since the asset is held only for 108 days during this 1st fiscal year.
(2) 98,816.44 = 40%
(3) Fiscal year charge = Net value since the depreciation end date 09/14/2010 is to be found in the fiscal year and application of prorata temporis 1,142.61 * 10 days / 257 days = 44.46
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00 | (1) 1,183.56 | 1,183.56 |
1/1/2006 – 12/31/2006 | 8,816.44 | (2) 3,526.58 | 4,710.14 |
1/1/2007 – 12/31/2007 | 5,289.86 | 2,115.94 | 6,826.08 |
1/1/2008 – 12/31/2008 | 3,173.92 | 1,269.57 | 8,095.65 |
1/1/2009 – 12/31/2009 | 1,904.35 | 761.74 | 8,857.39 |
1/1/2010 – 12/31/2010 | 1,142.61 | (3) 1,142.61 | 10,000.00 |
DI - Spanish mixed declining
It is the declining depreciation method applied according to Spanish rules: this depreciation method thus meets the Spanish accounting and fiscal standards.
It is called mixed in so far as the depreciation plan ends in straight-line, like the French declining method.
Depreciation origin
The origin of thedeclining depreciation is the day specified in the depreciation start date.
Duration
It must be entered by the user, in years and hundredths of years.
Example: 6 years 2/3 = 6,66 or 6,67.
For this depreciation method, Sage X3 will round to 2 decimals all the durations entered or imported with more than 2 decimals.Ditto for residual durations calculated in the framework of intra-group sales.
Rate
The rate that can be applied to the declining depreciation calculation can neither be entered, not determined by field associations.
It is automatically determined by Sage X3 by multiplying the straight-line depreciation rate corresponding to the standard use duration of the fixed asset by a changeable coefficient.
This coefficient is called declining coefficient and varies based on the depreciation duration:
- Duration < 5 years --> Coefficient = 1,5
- Duration = 5 years and < 8 years --> Coefficient = 2
- Duration = 8 years --> Coefficient = 2,5
The calculated depreciation rate is rounded to 2 decimals.
Examples:
Duration | Declining rate |
3 years | (1 / 3) * 1.5 = 50% |
4 years | (1 / 4) * 1.5 = 37.50% |
5 years | (1 / 5) * 2 = 40% |
6 years | (1 / 6) * 2 = 33.33% |
6,66 or 6,67 | (1 / 6.666666) * 2 = 30.00% |
7 years | (1 / 7) * 2 = 28.57% |
8 years | (1 / 8) * 2.5 = 31.25% |
10 years | (1 / 10) * 2.5 = 25% |
12 years | (1 / 12) * 2.5 = 20.83% |
15 years | (1 / 15) * 2.5 = 16.67% |
20 years | (1 / 20) * 2.5 = 12.5% |
Depreciation end date
It is determined as follows:
Depreciation start date + Depreciation duration
Example 1:
Depreciation start date = 12/5/2005
Duration = 3 years
Depreciation end date = 12/4/2008
Example 2:
Depreciation start date = 1/1/2005
Duration = 5 years
Depreciation end date = 12/31/2009
Prorata temporis
Time is expressed in days. A prorata temporis always expressed in days applies in the following cases:
During the acquisition fiscal year, if the depreciation origin is not the first day of the fiscal year.
If the duration of a fiscal year differs from 12 months.
During the disinvestment fiscal year: the charge is calculated until disposal day. This rule can be modified by Disposal rules: No depreciation expenditure on issue day, Previous fiscal year end issue and Current fiscal year end issue.
Depreciation charges
- The depreciation charge of the 1st fiscal year is equal to:
Depreciable value * declining rate * prorata temporis
A Prorata temporis in days is applied in the following cases:
- The Depreciation start date is beyond the fiscal year start date
- The fiscal year Duration differs from 12 months
- The Disposal date of the asset is in the interval [Fiscal year start date – Fiscal year end date]
- The depreciation charge of the next fiscal years is equal to:
Net depreciable value at fiscal year start * rate * prorata temporis
A Prorata temporis in days is applied in the following cases:
- The fiscal year Duration differs from 12 months
- The Disposal date of the asset is in the interval [Fiscal year start date – Fiscal year end date]
If the depreciation net value at fiscal year start is inferior or equal to depreciation value / depreciation duration, the calculation above is replaced by:
FY Charge = Net depreciable value at fiscal year start.
A prorata temporis is then applied to this FY charge in the following situations:
- The Fiscal year duration differs from 12 months
and
- The Disposal date of the asset is in the interval [Fiscal year start date – Fiscal year end date]
If the depreciation end date is earlier or equal to the fiscal year end date, the fiscal year charge will automatically be loaded with the net depreciable value, so as to close the depreciation.
Notes:
- Depreciable value = Gross value – Residual value
- Net depreciable value = Net value – Residual value
Examples:
1st example
- Gross value: 10,000
- Residual value: 0
- Depreciation start date: 9/15/2005
- Depreciation duration: 5 years, Rate: 40%
- Depreciation end date: 9/14/2010
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00 | (1) 1,183.56 | 1,183.56 |
1/1/2006 – 12/31/2006 | 8,816.44 | (2) 3,526.58 | 4,710.14 |
1/1/2007 – 12/31/2007 | 5,289.86 | 2,115.94 | 6,826.08 |
1/1/2008 – 12/31/2008 | 3,173.92 | 1,269.57 | 8,095.65 |
1/1/2009 – 12/31/2009 | 1,904.35 | (3) 1,904.35 | 10,000.00 |
1/1/2010 – 12/31/2010 | 0.00 | 0.00 | 10,000.00 |
(1) 10,000.00 * 40% * 108/365 since the asset is held only for 108 days during this 1st fiscal year.
(2) 8,816.44 = 40%
(3) Net value 1,904.35 < (10 000,00 / 5 ). The depreciation is closed, depreciation expenditure = 1,904.35
2nd example
- Gross value: 10,000
- Residual value: 0
- Depreciation start date: 9/15/2005
- Depreciation duration: 5 years, Rate: 40%
- Depreciation end date: 9/14/2010
- Asset issue date: 6/30/2008
Fiscal year | Net value | Fiscal year charge | Fiscal year total |
1/1/2005 – 12/31/2005 | 10,000.00 | (1) 1,183.56 | 1,183.56 |
1/1/2006 – 12/31/2006 | 8,816.44 | (2) 3,526.58 | 4,710.14 |
1/1/2007 – 12/31/2007 | 5,289.86 | 2,115.94 | 6,826.08 |
1/1/2008 – 12/31/2008 | 3,173.92 | (3) 631.32 | 7,457.40 |
(1) 10,000.00 * 40% * 108/365 since the asset is held only for 108 days during this 1st fiscal year.
(2) 98,816.44 = 40%
(3) 3,173.92 * 40% * 182/366 since the asset is held only for 182 days during this fiscal year.
Distribution of the 2006 fiscal year charge based on the period weight in days:
Period | Number of days / Weight | Number of holding days | Charge |
1/1/2006 – 3/31/2006 | 90 / 90 | 90 | (4) 961.79 |
4/1/2006 – 6/30/2006 | 91 / 90 | 91 | (5) 961.80 |
7/1/2006 – 9/30/2006 | 92 / 60 | 92 | (6) 641.20 |
10/1/2006 – 12/31/2006 | 92 / 90 | 92 | (7) 961.79 |
Fiscal year 2006 total | 3,526.58 | ||
(4) 3,526.58 * (90 / 90 * 90) / [(90 / 90 * 90) + (90 / 91 * 91) + (60 / 92 * 92) + (90 / 92 * 92) ] = 961.79
(5) 3,526.58 * [ (90 / 90 * 90) + (90 / 91 * 91) ]
/ [ (90 / 90 * 90) + (90 / 91 * 91) + (60 / 92 * 92) + (90 / 92 * 92) ] = 1,923.59 – 961.79 = 961.80
(6) 3,526.58 * [(90 / 90 * 90) + (90 / 91 * 91) + (60 / 92 * 92)]
/ [(90 / 90 * 90) + (90 / 91 * 91) + (60 / 92 * 92) + (90 / 92 * 92) ] = 2,564.79 – 1,923.59 = 641.20
(7) 3,526.58 * [(90 / 90 * 90) + (90 / 91 * 91) + (60 / 92 * 92) + (90 / 92 * 92) ]
/ [(90 / 90 * 90) + (90 / 91 * 91) + (60 / 92 * 92) + (90 / 92 * 92) ] = 3,526.58 – 2,564.79 = 961.79