Fixed Assets Register & Automated Depreciation Schedules

Machinery, company vehicles, IT equipment, office furnishings, and leasehold improvements represent significant capital expenditures that must be capitalized and depreciated over their useful economic lives. BIZA Fixed Assets automates asset registration, depreciation calculations, and general ledger postings.

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1. Asset Capitalization & Registration

When a capital asset is acquired (via purchase entry, direct cash purchase, or capital project):

• Asset Master Record: Item name, category (e.g., Computer Equipment, Vehicles, Plant & Machinery), serial number, purchase date, and physical location.
• Custodian & Department: Assign responsibility to a specific employee or departmental cost center.
• Cost Basis & Salvage Value: Record initial purchase cost, capitalized installation/freight charges, and estimated residual salvage value at the end of its life.

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2. Depreciation Schedules & Calculation Methods

BIZA supports standard financial depreciation methodologies:

Straight-Line Method (SLM)

Depreciates an equal amount each fiscal period over the asset's useful life: $$\text{Periodic Depreciation} = \frac{\text{Asset Cost} - \text{Salvage Value}}{\text{Useful Life in Periods}}$$

Reducing / Declining Balance Method (DB)

Accelerates depreciation in earlier years by applying a fixed percentage to the diminishing book value: $$\text{Periodic Depreciation} = \text{Book Value at Start of Period} \times \text{Depreciation Rate}$$

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3. Automated Monthly Depreciation Posting

Finance teams no longer need to calculate depreciation spreadsheets and enter manual journals every month:

• Batch Depreciation Run: Click Run Monthly Depreciation at month-end.
• Automated Journal Posting: BIZA calculates the exact depreciation for all active assets and posts a balanced journal entry:
  • Debit: Depreciation Expense (P&L account mapped by asset category).
  • Credit: Accumulated Depreciation (Balance Sheet contra-asset account).
• Audit Trail: Each asset's individual depreciation schedule updates with the voucher number, posted date, and remaining net book value.

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4. Asset Disposal, Sale & Scrapping

When an asset reaches the end of its life or is sold:

• Sale to Customer: Record disposal proceeds; BIZA calculates the Net Book Value (Cost minus Accumulated Depreciation) and posts the difference directly to Gain / Loss on Asset Disposal.
• Scrapping / Write-Off: Write off damaged or obsolete equipment, derecognizing the original asset and accumulated depreciation while recognizing an impairment loss.