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Fixed assets management

  
Fixed assets depreciation is another special area that foreign companies will face in China.

  • Classification of current/long-term assets and current/long-term liabilities is the only acceptable reporting method.
  •  The acceptable depreciation methods in China are: straight line method, workload method, double declining balance method and sum-of-the-years-digits method.
  •  A certain percentage of the original value must be set as its residue value, which should not be included in the depreciated value.
  •  During yearly external audit, adjusting entries can be made of the depreciation value for taxation purpose.

The K/3 system, which is certified by the PRC State Finance Bureau, fully supports all the above requirements and other related F/A policy and therefore can automate the standard monthly fixed asset depreciation booking.

Kingdee also provides user-definable additional accounting periods, i.e. 13th period, 14th period, etc. for booking adjusting entries for external audit purpose, which usually happens in the following Jan. to Apr. Adjusting entries booked in these additional periods will change the opening balance of this year without having to de-close previous periods’ ledger books.

  • Foreign companies usually need to maintain 2 fixed assets’ books with different asset classification, useful life estimate, residue value setting and depreciation method definition.

Kingdee supports multiple books for fixed assets depreciation. Fixed asset cards information can be easily copied from one book to another and the depreciation method, residue value, etc. can be set different in different books.

Multiple F/A depreciation books