On Fri, 19 Nov 1999 14:20:51 +0100, the world broke into rejoicing as
Jan Schrage <[EMAIL PROTECTED]> said various things
about depreciation...
There would be merit in having a flexible way of specifying a transaction
that would then generate a bunch of depreciation transactions.
I certainly agree with you that there are all too many possible policies.
I was involved, a couple years ago, with converting all of American
Airline's assets from old accounting system to new one, and there were
differing policies in different jurisdictions going to the fairly insane
extreme that they simultaneously used, on some assets, up to 8 different
depreciation policies due to being in many tax jurisdictions.
Note that I didn't do depreciation calculations on that project; I just
did [weird stuff to let them flexibly assign depreciation policies...]
My familiarity with depreciation is mainly with the Canadian schemes,
where financial reporting may mandate using "linear" depreciation,
or what is called "sum of digits" (that you described). The tax system
mandates a different scheme, where different classes of assets depreciate
by some fixed percentage of their value each year thus:
First year: Value was $10,000
CCA Rate: 30%
--> First year depreciation is $1500 (1/2 of 30%)
--> 2nd year depreciation is $2550 (30% of the remaining $8500)
--> 3rd year depreciation is $1785 (30% of remaining $5950)
--> 4th year $1250 (30% of 4165)
...
Providing a way to set up such "automated policies" would indeed be
valuable, but seems to me to be well out of scope at this point,
particularly as determining defaults, for the "accounting naive," is
as dangerous as you suggest.
--
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It's as unthinkable as fornication, or smoking pot." -- RMS
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