How to Run Month-End Depreciation
This page explains how to run the monthly depreciation calculation, review the results, and produce journals for export to your general ledger.
Before You Begin
- Ensure you are in the Fixed Asset Management profile.
- Your financial setup must be complete: books, depreciation types, accounting periods, and nominal codes.
- Process any outstanding disposals before calculating depreciation.
- Review depreciation setup for any new or changed assets.
Step-by-Step Procedure
Step 1: Open Period End Processing
Navigate to Financial > Asset Accounting > Period End Processing. The screen shows each accounting period set with its current period and the available actions.
Step 2: Calculate Depreciation
Click the Calculate button to run depreciation for the current period. The system processes every asset in every book:
- It identifies the depreciation rule in effect for each asset.
- It applies the depreciation formula using the asset's current values (original cost, accumulated depreciation, salvage value, recovery period).
- It creates a depreciation transaction for each asset-book combination.
- It updates accumulated depreciation and net book value.
Processing runs as a batch job. Do not close the browser while it is running. A register of a few thousand assets typically completes in under a minute.
Warning: Do not calculate depreciation more than once for the same period without first using the Rewind button. Running the calculation twice without rewinding can result in doubled depreciation charges.
Step 3: Review Results
Once calculation is complete, review the results before producing journals. Run the Depreciation in Current Period report and check:
| Check | What to Look For |
|---|---|
| Total depreciation | Compare to last month. A significant unexplained change is a red flag. |
| Individual outliers | Sort by amount to find unusually high or low charges. |
| New assets | Verify recently added assets depreciated at the expected rate. |
| Disposed assets | Confirm disposed assets were excluded from the calculation. |
| Zero-charge assets | Investigate assets that should be depreciating but show a zero charge. |
Step 4: Correct Errors (If Needed)
If you find errors, click the Rewind button to reverse depreciation for the current period. This deletes all depreciation transactions for the period and resets net book values to their pre-calculation state. Make your corrections, then recalculate.
Step 5: Produce Journals
Once the figures are confirmed, click the Journals button to generate journal files for export to your general ledger. Journal files can be accessed from the journal list below the processing options, or from Financial > Asset Accounting > List of Journals.
Step 6: Export and Close
Export the journal files to your accounting system. Optionally, close the period to prevent further postings.
Monthly Checklist
- Review depreciation setup for new or changed assets
- Ensure all disposals for the period have been processed
- Calculate depreciation
- Review total depreciation and check for outliers
- Verify new assets depreciated correctly
- Rewind and recalculate if corrections are needed
- Produce journals
- Export journals to the general ledger
- Close the period (optional but recommended)
Related Articles
- The Monthly Accounting Process — The complete monthly accounting workflow
- Month End Results — Understanding month-end depreciation results
- How to Review Depreciation Before Posting — Reviewing depreciation calculations before posting
- How to Generate Journal Entries — Generating journal entries for your accounting system
- Accounting Periods — Configuring accounting periods