Running Depreciation

AccuArk's depreciation run tool calculates and posts depreciation for all eligible assets in a single batch operation. Rather than calculating depreciation for each asset individually, you define a period, preview the results, and then execute the run to update every asset's accumulated depreciation and post the corresponding GL journal entries.

How to Access

Navigate to Assets > Run Depreciation to open FrmDepreciationRun.

Required Permission

You must have the Asset Depreciation permission to preview, execute, or reverse depreciation runs. This permission is separate from Asset Maintenance and is typically assigned only to accounting or finance staff.

Setting Up a Run

Before executing a depreciation run, you must configure the following parameters:

The frequency setting is important because it tells the system how much of the annual depreciation to allocate to this run. A monthly frequency allocates 1/12 of the annual amount, quarterly allocates 1/4, and annual allocates the full year.

Preview

After setting the parameters, click Preview to see a detailed grid of every asset that will be included in the run. The preview grid shows:

The preview is essential for catching errors before they reach your general ledger. Review the preview carefully and look for:

• Assets that should not be in the run (perhaps they were recently disposed of)
• Unusually large or small depreciation amounts that might indicate a configuration error
• Assets showing zero depreciation when you expected a charge (check if they are fully depreciated)
• The total depreciation amount at the bottom of the grid to verify it is reasonable for your asset base

The preview does not make any changes to your data. You can run it as many times as you need.

Which Assets Are Included

The depreciation run includes all assets that meet the following criteria:

• Status is Active — Only active assets are depreciated. Disposed, retired, or inactive assets are excluded.
• Depreciation method is set — The asset must have a depreciation method assigned (straight-line, declining balance, double declining balance, sum-of-years-digits, or units of production). Assets with no method are skipped.
• Useful life is greater than zero — The asset must have a useful life configured in months.
• Not fully depreciated — Assets whose accumulated depreciation already equals or exceeds their depreciable base (cost minus salvage) are excluded. These are flagged as fully depreciated.
• Matches filters — If you applied a location or category filter, only matching assets are included.

Disposed assets are always excluded regardless of their depreciation status.

Executing the Run

Once you have reviewed the preview and are satisfied with the results, click Execute (or Post) to commit the depreciation run. This performs three actions for each asset:

1. Creates a depreciation entry — A depreciation record is stored for the asset with the period dates, amount, and method used.
2. Updates accumulated depreciation — The asset's accumulated_depreciation field is increased by the period's depreciation amount. The book value (cost minus accumulated depreciation) decreases accordingly.
3. Posts GL journal entries — For each asset, AccuArk creates a journal entry:
   • Debit Depreciation Expense (an expense account on the income statement)
   • Credit Accumulated Depreciation (a contra-asset account on the balance sheet)

The GL accounts used come from the asset's record. If the asset does not have specific GL accounts configured, AccuArk uses the default GL accounts from the asset's category.

GL Posting Details

Depreciation journal entries follow the standard double-entry pattern:

Each asset gets its own journal entry line, but all entries for a single depreciation run are grouped into a depreciation run batch. The batch includes a reference to the run ID so you can trace every entry back to the run that created it.

The Depreciation Expense account appears on the Profit & Loss statement, reducing net income. The Accumulated Depreciation account appears on the Balance Sheet as a contra-asset, reducing the net book value of your fixed assets.

Run History

The Run History tab on the FrmDepreciationRun form shows all previous depreciation runs. Each entry displays:

The run history provides a complete audit trail of every depreciation batch posted to your books.

Reversing a Run

If a depreciation run was posted incorrectly (wrong period, wrong amount, duplicate run), you can reverse it:

1. Go to the Run History tab
2. Select the run you want to reverse
3. Click Reverse
4. Confirm the reversal

Reversing a run performs the following actions:

• Reverses all GL entries — Creates offsetting journal entries (debit Accumulated Depreciation, credit Depreciation Expense) that cancel out the original postings
• Subtracts depreciation — Reduces each asset's accumulated_depreciation by the amount that was originally posted, restoring the previous book values
• Marks the run as Reversed — The run remains in history for audit trail purposes but is flagged as reversed

Use reversals sparingly. They are typically only needed when:

• A run was accidentally posted to the wrong period
• A duplicate run was executed for the same period
• Asset data was significantly incorrect when the run was posted and needs to be corrected before re-running

After reversing, correct the underlying data and execute a new run for the correct period.

Fully Depreciated Assets

When an asset's accumulated depreciation reaches its depreciable base (total capitalized cost minus salvage value), the asset is considered fully depreciated. At this point:

• The asset's book value equals its salvage value
• The asset stops appearing in future depreciation run previews
• The asset is flagged as fully depreciated in the asset register
• The asset remains on your books at salvage value until it is disposed of

Fully depreciated assets are still active assets. They can still be used, maintained, transferred, and eventually disposed of. The only difference is that no more depreciation expense is recorded for them.

Tips and Best Practices

• Run depreciation monthly on a consistent schedule — Pick a day each month (such as the last business day) and always run depreciation on that date. Consistency makes your financial statements reliable and predictable.
• Always preview before posting — Never execute a depreciation run without reviewing the preview first. A few minutes of review can prevent hours of cleanup.
• Run for all locations unless you have a specific reason to filter. Running by location can be useful if different locations close their books on different schedules, but in most cases a single company-wide run is simplest.
• Coordinate with period close — Run depreciation before closing the accounting period. Once a period is closed, you cannot post depreciation entries to it without reopening it.
• Keep a depreciation calendar — Note your depreciation run dates on your accounting calendar so they are never missed.
• Review the Depreciation Schedule Report after each run to verify that accumulated depreciation and book values are correct across your entire asset portfolio.

Related Articles

• Understanding Depreciation Methods
• Logging Maintenance Events
• Asset Dashboard & Analytics