Fixed Assets

The term fixed assets generally refers to the long-term assets, tangible assets used in a business that are classified as property, plant and equipment. DEAR Inventory allows you to add new fixed assets to your inventory, register/unregister fixed assets and calculate depreciation for fixed assets. 


NOTE: If you are using Xero as your accounting system, this function will not be available in DEAR. You can manage your fixed assets through your accounting system. 


Prerequisites:


  1. Fixed Asset Types
  2. Add a New Fixed Asset
  3. Registering a Fixed Asset
  4. Posting Depreciation


Fixed Asset Types

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You can create multiple Fixed Asset Types to classify your fixed assets. Fixed Asset Types allow you to specify Depreciation Methods, Averaging Methods, Effective Life, and other fixed asset parameters for a group rather than for each individual fixed asset. 


NOTE: You can assign a fixed asset type to a fixed asset, but still change the depreciation parameters of an individual fixed asset. Change depreciation parameters by going to Financials -> Fixed Assets, selecting the fixed asset and manually changing the parameters. 


Creating a Fixed Asset Type:

  1. Create a new Fixed Asset Type by navigating to Settings -> Reference Books -> Financials -> Fixed Asset Types. You can also create a new Fixed Asset Type from the product details screen (Inventory -> Products -> [selected product]) by clicking + next to Fixed Asset Type
  2. A pop-up window will open. Fill in the fields; mandatory fields are marked with an asterisk (*). 
    • Consult with your accountant or bookkeeper if you are unsure of which accounts need to be assigned or what information should be entered into these fields. 
  3. Save your changes to finish. 




Add a New Fixed Asset

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Fixed Assets must first be added to your Inventory Listing before their quantity can be updated. Once the fixed asset details are added to your Inventory Listing, you can enter the fixed asset quantity via a purchase order, stock adjustment, or stocktake/inventory count. 


To add a fixed asset to your Inventory Listing:

  1. Go to Inventory -> New -> Product/Service.
  2. In the Type field, choose Fixed Asset, select a Fixed Asset Type from the dropdown menu and fill in the rest of the mandatory fields (marked with an asterisk {*}). 
    • NOTE: Fixed Assets require a Fixed Asset Location, even if they are physically in the same place as an Inventory Location. Create and manage your fixed asset locations by navigating to Settings -> Reference Books -> Stock -> Locations & Bins and choosing the Fixed Asset Locations tab. 
  3. Click Save.

  4. You will now need to add a quantity of this new asset either through a purchase invoice or via stock adjustment/stocktake before the fixed asset can be registered.



Add a New Fixed Asset Using a Purchase Invoice

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To add a new fixed asset using a Purchase Invoice:

  1. Navigate to Purchase -> New -> Purchase.
  2. Fill in all invoice details marked with a red asterisk.
  3. Choose the newly created fixed asset under products, then click Authorise.
  4. Fill in the Invoice as usual. See Processing a Purchase for more information. 

  5. Go to the Stock Received tab and click +Copy From Invoice and then Authorise once the asset has been physically received. This will now add the asset to your availability list so you can proceed to register the asset.




Add a New Fixed Asset Using Stock Adjustment

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To add a new fixed asset using Stock Adjustment:

  1. Go to Inventory -> New -> Stock Adjustment.  
  2. In Zero stock on hand Product, click + or Add more items to add the new asset to Inventory and click Complete.





Add a New Fixed Asset Using Stocktake/Inventory Count

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This option can be used if you find an unregistered asset during inventory count.


To add a new fixed asset using Stocktake/Inventory Count:

  1. Navigate to Inventory -> New -> Stocktake/count.
  2. Select the Location where the asset was found.
  3. Check the Include quantity on hand box and scroll to the bottom of the page. 
  4. In Zero stock on hand product, click + or Add more items to add the asset.
  5. Proceed to add the relevant asset and click Complete to finish. 




Registering a Fixed Asset

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Fixed Assets in your inventory must be registered before depreciation can be calculated and posted. 


To register a Fixed Asset:

  1. Navigate to Financials -> Fixed Assets.
  2. This screen displays a list of all your registered and unregistered assets. Use the filter to find only unregistered assets.
  3. Select the asset(s) you would like to register, then click the Register button.

  4. A message will pop up asking you to confirm the registration; click Yes to proceed to the next screen. The status of the selected asset has now been changed to Registered.

  5. By clicking on the asset, you can bring up the details and make changes to the depreciation method if required. Here you can also view the YTD depreciation & attach copies of various documents regarding this asset. Here we may also choose to dispose of the asset by including the salvage value.



Posting Depreciation

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Depreciation is the portion of a fixed asset's cost recorded as an expense during the current accounting period. In simple terms, since a fixed asset has a useful life longer than one accounting period, depreciation represents the part of its value used up during the current period. 


To post depreciation for an asset:

  1. Navigate to Financials -> Depreciation.  
  2. Here you will see all the YTD depreciations that have been posted for various assets.
  3. To run depreciation for a new period, click Run Depreciation on the left-hand side.


  4. The Start Date will be from the last depreciation period. Select the End date. Only Assets registered for that period will be available to run depreciation.
  5. Click Save.


  6. You can now see the newly posted depreciation in this summary screen.
  7. If you have made a mistake (for example, selecting the wrong depreciation type for an asset), you can reverse the posted depreciation by clicking Rollback Depreciation













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