Depreciation Process in Dynamics 365 Business Central

May 10, 2022
|In Business, Business Value, Business Intelligence, Business Central, Accounting
|By Bond Consulting Services

Once the fixed assets have been setup in Business Central, users will need to be able to process depreciation. Depreciation is used to allocate the cost of fixed assets, such as machinery and equipment, over their depreciable life. For each fixed asset, you must make sure that the following is setup/defined.

  1. Each asset is setup in Business Central with its own Fixed Asset card and relevant details
  2. Make sure that a depreciation method is assigned along with a depreciation book code
  3. Depreciation Starting Date and No of Depreciation years are populated
  4. Make sure the item has been acquired

Once the above has been confirmed, there are two ways to post depreciation:

  • Automatically, by running the Calculate Depreciation batch job
  • Manually, by using the fixed asset G/L journal

To Calculate Depreciation Automatically

  1. Search for Calculate Depreciation function in the global search or in the Fixed Assets page select Process > Calculate Depreciation.

  2. In the Calculate Depreciation window, select the Depreciation Book, FA Posting Date, and other fields. In addition, you can filter by a specific asset, class or subclass. Click Ok.
  3. The batch job will calculate the depreciation and create lines in the fixed asset G/L journal.
  4. Select Yes or search for Fixed Asset G/L Journal in the global search.
  5. On the Fixed Asset G/L Journal page, in the of Depreciation Days field, you can see how many days of depreciation has been calculated for.
  6. Once all the fields are confirmed, select Process > Post to record depreciation in both the FA subledger and general ledger.

To Post Depreciation Manually from the Fixed Asset G/L Journal

  1. Search for Fixed Asset G/L Journal in the global search.
  2. Create an initial journal line and populate the fields as necessary. In the FA Posting Type field, select Depreciation.
  1. Select Process > Insert FA Bal. Account A second journal line is created for the balancing account that is set up for allocation posting.
  2. Choose the Post action to post the journal and record depreciation in both the FA subledger and general ledger.

For more information about this process or any Dynamics products please reach out to Support@BondConsultingServices.com or click here to schedule a free consultation with our expert analysts.