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Managerial Depreciation - Linear Method with Maximum Depreciation Value

This method is a variant of the linear depreciation method. Also known as straight-line depreciation, it delimits the value until the one with which the asset will be depreciated.
The maximum depreciation value states that the asset still has a residual value at the end of its useful life.
In this method, the field Max Depr Val (N3_VMXDEPR), which determines the maximum value of depreciation, is required.

Calculation Characteristics:

The rate is fixed and set based on the asset's useful life.

Formula to determine the rate:

Annual Depreciation Rate = 100% / Useful Life of Asset

Monthly Depreciation Rate = (100% / Useful Life of Asset) / 12

Formula to determine the depreciation value:

Annual Depreciation = Maximum Depreciation Value * Annual Depreciation Value
Monthly Depreciation = Maximum Depreciation Value * Monthly Depreciation Rate

Where:

The Maximum Depreciation Value is defined by the government for tax purposes, or specified by the accountant or property, based on the company's expected return from the asset after the end of its useful life.

Example of calculation with monthly depreciation:

Asset value                               30,000.00
Limit value                                   25,000.00
Useful life (years)                             05 years
Annual rate                                   20%
Monthly rate                                1.67%

Calculation Considerations:

When the maximum depreciation value is set, the calculation of depreciation must be based on it, because if the calculation continued being based on the updated original value, the depreciation would have an accelerated characteristic, which distorts the depreciation status, as the maximum value would be reached before the end of the asset's useful life;

Linear with Maximum Depreciation Value Calculation with more than one currency

The Fixed Assets module allows controlling the asset in multiple currencies, performing one depreciation calculation for each currency separately from the others, because each currency has its own original value and its own depreciation rate.

Besides the characteristic of calculation per currency, you can define the base currency for the depreciation limit as different from the strong currency by setting the following parameters:

MV_ATFMOED: define the strong currency for Fixed Assets, to be used as base for controlling currency conversions and other controls of the module.

MV_ATFMDMX: define the reference currency for the limit value of depreciation.
Due to these System peculiarities, you need to provide the calculation bases for the other currencies entered in the asset file, based on the calculation defined for the currency used for controlling the maximum depreciation value.

This proportioning is performed from a simple rule of three, in which;

Maximum Value in Currency N = Base Value in Currency N * (Maximum Value in Maximum Currency / Base Value of Maximum Currency).

Example of calculation with linear depreciation with maximum value and base in other currency:

Base Value for Currency 02                                   USD 15,000.00
Maximum Value in Currency 02                                  USD 10,000.00
Proportion for other currencies                     10,000.00 / 15,000.00 = 66.67%
Base Value for Currency 01                                   30,000.00 * 66.67% = 20,000.00

Calculation in Currency 02:

Calculation in Currency 01: