QAD Fixed Assets Demonstration Guide. August 7, 2015 EAM 2015 / EE2015

Transcription

1 QAD Fixed Assets Demonstration Guide August 7, 2015 EAM 2015 / EE2015

2 Overview This demonstration focuses on one aspect of QAD Enterprise Financials Fixed Assets and shows how this functionality supports the vision of the Effective Enterprise; where every business process is working at peak efficiency and perfectly aligned to the company s strategic goals. QAD Enterprise Financials Fixed Assets Key Points Enabling the Effective Enterprise

3 Related Metrics Leveraging Fixed Assets to automate processes will affect the Financial Compliance KPI. A typical measurement related to this KPI is Financial Operating Effectiveness. Providing a single place to record all fixed asset activity, with automatic general ledger postings for asset acquisition, depreciation, retirement and transfer, reduces administrative time and costly errors. You will see labor savings of 10 to 20%. Additional metrics and the relative importance of each one will depend on your definition of the Effective Enterprise. You can monitor performance against your defined metrics using a combination of Business Intelligence Dashboards, Operational Metrics, Browses and Reports. Fixed Assets Related Metrics Financial Operating Efficiency Key Points Financial Operating Effectiveness o Reduce labor cost by 10 to 20% Standard metrics Importance varies by company

4 Enabling Solution Fixed Assets supports improvements to this key metric by automating the process of managing fixed assets, from inception to retirement. Using Fixed Assets, you can record asset information manually or create assets automatically by capitalizing project expenditures. It provides multiple advanced depreciation methods and allows each asset to have any number of depreciation books for reporting and tax purposes. Fixed Assets supports a full set of transactions, including asset retirement, asset splitting and book adjustments, creating fixed asset transactions and general ledger postings for acquisition, depreciation, retirement and transfer including correction transactions. Fixed Assets Enabling Solution Fixed asset capitalization Multiple depreciation methods Multiple depreciation books Multi-GAAP and financial reporting Asset transfer, split, and retirement Book adjustments General ledger transactions Key Points Automatically create Fixed Asset record Multiple depreciation methods Multiple sets of books General Ledger transactions

5 Demonstration Summary In this demonstration, you will see how Fixed Assets simplifies administrative processes. Begin by purchasing an asset against a capital project managed using QAD Enterprise Asset Management. You can capitalize assets directly from there, creating all the appropriate information in the Fixed Asset book. Review the asset information and depreciation schedules, then create General Ledger transactions. Fixed Assets Demonstration Summary Asset capitalization Fixed Asset information Depreciation methods Fixed Asset life cycle Depreciation schedules General Ledger transactions Key Points EAM Project /Job capitalization Fixed Asset depreciation General Ledger transactions

6 How QAD tracks capital costs Capital Projects QAD helps you manage expenditures on capital equipment using QAD Enterprise Asset Management - Projects. Here is a capital project to build a new production line. Jobs include purchasing a new press and developing the tooling, as well as buying equipment for material handling. Each of the jobs in a project has a predefined budget and you can carefully track spending, ensuring you keep within that approved budget. The system maintains complete cost details at the job level, where you can define if these costs are to be capitalized as part of the fixed asset, or expensed. The Gantry Crane was budgeted as a Capital expense, expected to cost $14,500 but purchased for only $14,000. The Press cost $15,000 but before it is fully operational on the new production line you are expecting additional costs for the tooling and installation. Demo 1. Launch QAD Enterprise Applications 2. Enter User demo, Password <blank> 3. Click OK

7 4. In Favorites, click Projects (EAM) 5. Highlight Project P Resize bottom half of screen larger 7. Double-click Job Gantry Crane 8. In Exp Type, click drop-down 9. Click Cost tab Note Receipts $14,000

8 10. Close tab 11. Double-click Project PO Resize right menu 13. In right menu, click Job Summary Note: Actual versus expected costs

9 Key Points Multiple jobs and sub-jobs in each project Expense or Capital Predefined budget per job Monitor spending at job level

10 How QAD improves accuracy Capitalize Expenditures QAD Enterprise Asset Management tracks all of the expenditures associated with a project, and allows you to capitalize any or all of them. You don t have to keep an offline spreadsheet to track the costs. Here is the summary of costs for this project, maintained in detail by category labor, material, contract services, and other. The cost for the new press was 15,000 and the crane was 14,000. The requisitions and receipts are tied directly to the project and job, with expense type Capital. Now capitalize these costs. You can capitalize at the project level or at the job or subjob level. in this example, if you want to move individual pieces of equipment around later you might prefer to capitalize them separately. Begin by capitalizing the sub-job, the purchased Gantry Crane. Notice that the capitalization amount displays as the total amount not yet capitalized on this job. Next capitalize the job, Production Line. Since the cost to date only includes the $15,000 spent on the press that is the total amount available to be capitalized. You are still expecting additional costs for installation and tooling. Demo 1. In right menu, click Cost Analysis 2. Click Material tab 3. In right menu, click Requisitions

11 4. Double-click Requisition Line 1 5. Click Expense tab

12 6. Close two tabs 7. In Projects tab, highlight Project P Click Action

13 9. In bottom half of screen, highlight Job No Gantry Crane 10. Click Action 11. Select Action > Capitalize New Job Asset 12. Enter Fixed Asset ID A-CR 15, Description Gantry Crane for Production Line 15, Class 33, Location L-01, New Capitalized Amt 14,000

14 13. Click OK 14. At warning, click OK 15. In bottom half of screen, highlight Job No 01 Production Line 16. Click Action 17. Select Action > Capitalize New Job Asset 18. Enter Fixed Asset ID A-PL15, Description Production Line 15, Class 33, Location L- 01, New Capitalized Amt 15,000

15 19. Click OK 20. At warning, click OK 21. Double-click Project PO Resize right-menu 23. Click Action

16 24. Select Action > Refresh 25. On right menu, click More icon 26. Click Fixed Asset Details 27. Close tab Key Points Capitalize expenditures to create Fixed Assets Capitalize project, job or sub-job Fixed asset details maintained by project and job

17 How QAD reduces data entry Enterprise Financials Integration Capitalizing the assets in Enterprise Asset Management automatically generated fixed asset records in QAD Enterprise Financials with the correct asset class, location, service date and cost. There is no need to rekey any of the information, but usually your fixed asset manager will review the information and update things like replacement value. Demo 1. In Favorites, select Fixed Asset Maintenance (32.3) 2. Press down arrow Key Points Capitalize in Enterprise Asset Management creates Fixed Asset record No need to re-key information

18 How QAD supports multi-year projects Additional Expenditures In some cases, you may incur additional costs after you capitalize a project. In fact, this is fairly common for projects lasting over more than one fiscal year. Before going into the nuts and bolts of how you manage Fixed Assets in QAD Enterprise Financials, go back to the project and record some additional cost. Keep it simple and just post some labor for installing the press. Then capitalize this additional labor using Modify Job Capital Asset. This shows you the total amount already capitalized $15,000 and the uncapitalized amount the extra labor you just posted. Simply update the New Capitalized Amount o the total amount spent and it updates the Fixed Asset record and any associated depreciation schedules. It s just that simple! Demo 1. Click Projects tab 2. Highlight Project PO Click Action

19 4. Select Action > Post Labor 5. Enter Time 99:00, Job Click Save icon 7. In Projects tab, click Action > Refresh 8. In bottom half of screen, highlight Job No 01 Production Line 9. Click Action

20 10. Click Action > Modify Job Asset 11. Enter New Capitalized Amt 24, Click OK 2 times 13. Double-click Job Resize right menu

21 15. In right menu, select Job Fixed Asset Details 16. Close tab 17. Close Project tab Key Points Update fixed asset to include additional costs Maintain audit trail

22 How QAD simplifies financial reporting Asset Details Here is the updated fixed asset record. Each fixed asset will have one or more depreciation books. These default from the asset class, but you can modify them as needed for each asset. This allows you to calculate depreciation using different methods. For example, assets may be depreciated one way for tax purposes and another for financial purposes; or depreciation rules may be different according to federal or state laws. The asset can have a different projected life, depreciation cost basis and salvage value in each book, and use a different depreciation method. Demo 1. In Fixed Asset Maintenance tab, click up/down arrow to refresh A-PL15 2. Press down-arrow to FA-01

23 3. Click Books button 4. Highlight Book B Click Detail button

24 6. Click End button 7. Highlight Book B Click Detail button

25 9. Click End button 10. Click End button (or Back) Key Points Multiple books o Primary o Others for different reporting (ie. Federal, State)

26 Asset Class and Depreciation Books Note how each of the fixed assets has a fixed asset class. This is used to group similar items, items with the same service lives, or items using the same depreciation methods for both book and tax purposes. Depreciation for assets in the same class generally affects the same general ledger accounts for asset investment, accumulated depreciation and depreciation expense. The Asset Class for a fixed asset determines the default set of Depreciation Books. In the case of land, a non-depreciable asset, there are no associated posting books. Buildings have only one book and Plant & Equipment has two each using a different projected life. When there are multiple books, one is designated as primary. This creates transactions for the official layer. Other books may be non-posting or posting, for example posting to the management layer for reporting. Posting books use the pre-defined GL calendar. Other books can use other calendars. Demo 1. In Favorites, click Set Up Fixed Assets 2. In Process Map, click Set up Classes ( )

27 3. Down-arrow to class Down-arrow to class Click Processes tab 6. Click Set Up Depreciation Books (32.1.9)

28 Key Points Asset Class determines Depreciation Books Layer o Primary posting book posts to primary layer o Other posting books post to management layer Calendar o Posting books use GL calendar o Other books use any calendar

29 How QAD supports internationalization Books in Multiple Currencies You may have noticed that each depreciation book has an associated currency. In this example, most of the depreciation books are in US dollars that s the base currency for this domain. However, some of the fixed assets need to be tracked in EURO to maintain an IFRS book. Some need to be tracked in Canadian dollars that s the currency of the corporate Headquarters. Asset class 85 Computer Equipment uses US dollars for the main posting book, but also maintains a book in Canadian currency and an IFRS posting book. Demo 1. Down arrow to Book B Close tab 3. In Class Maintenance tab, down-arrow to Class Close tab Key Points Each book has associated currency Maintain depreciation amounts by currency

30 How QAD saves time and reduces errors Depreciation Calculations QAD calculates depreciation amounts automatically, based on depreciation methods you choose for each depreciation book. Standard depreciation methods include straight line, units of production, declining balance, sum of the years digits, and flat rate. You can also set up your own depreciation methods using custom tables. Define which of these are active and associate them with each fixed asset class. Since you do not only purchase or retire assets at the beginning or end of a month, you also have extensive control over how depreciation calculations for the first and last years of the asset s life. Options include full period, half period, next period, full quarter, half quarter, full year, half year and modified half year. For example, when you select full period even if you buy an asset the last day of the month you will book a full month s depreciation. When you calculate depreciation based on units of production, you set up meters to record the initial meter setting and regular meter readings. A meter can be assign to a single asset or a group of assets. Demo 1. Click Processes tab 2. In Process Map, click Set Up Depreciation Methods (32.1.1)

31 3. Close tab 4. In Process Map, click Set Up Fixed Asset Meters (32.11) 5. Close tab Key Points Depreciation Methods o o o o o o o Straight line Units of Production Declining Balance Declining Balance switch to Straight Line Sum-of-the-Years Digits Flat Rate Depreciation Custom tables used to set up your own depreciation methods Method convention determines how much depreciation is taken first/last period of asset life

32 Meters collect actual usage o Initial setting, rollover setting o Reset setting and date o Meter reading and date

33 How QAD tracks all asset types Depreciable & Non-Depreciable Assets You can use Fixed Asset to manage any or all of your assets. In this demonstration, you just added new production equipment, but you can track any type of asset office equipment, vehicles, plant and equipment grouped by asset class. Not all fixed assets are depreciable for example, you do not depreciate land but you may still want to include it in your Fixed Asset register. Data 1. In Favorites, select Fixed Asset Browse (32.4) 2. Right-click Class

34 3. Select Group by Class 4. Click expand + icon to expand all classes 6. Close tab Key Points Tracks all types of assets Depreciable or non-depreciable

35 How QAD manages the entire life cycle Process Maps Fixed Assets helps you manage the entire life cycle, from capitalization through to transfer, sale or retirement of each asset and automatically generates the appropriate general ledger transactions for depreciation (periodic or accumulated), intercompany transfer, and gain or loss on disposal. Process maps make it easy to navigate through the various steps, taking you directly to the required function and suggesting appropriate reports. Simply click any node on the process map to go directly to that function. Demo 1. In Favorites, select Manage Fixed Assets Key Points Add or Change Fixed Asset information o Extend useful life; Change salvage value Transfer o To another location or entity; Creates intercompany GL transactions Retire o Calculates and posts Gain or Loss on disposal; Split asset to transfer or retire a portion

36 Depreciation Transactions One of the most useful reports is the Asset Depreciation Array Report. Here, you can review depreciation amounts in detail over the life span of the asset, for any or all assets, by book and currency. Use this report to review depreciation schedules and determine amounts in non-posting books. For posting books, you simply run the transaction post at the end of each period. This generates the fixed asset depreciation transactions. Review and correct these transactions, as needed, and then post them to the General Ledger. Demo 1. In Process Map, click Run Asset Depreciation Array Report (32.5.9) 2. Enter Asset FA-05, To FA Enter output printer

37 4. Page down to B Page down to B-05

38 6. Close tab 7. In Process Map, click Post Fixed Asset Transactions (32.13) 8. Enter Asset FA-05, To FA Enter Effective Date 03/31/ Check Post Transactions 11. Enter Output printer

39 12. Close 2 tabs 13. In Process Map, click Post GL Transactions ( ) 14. Enter Effective Date To 03/31/2015, Daybook FA, To FA 15. Enter Output printer 7. Close tabs Key Points Automatically calculates monthly amounts for each book, in book currency Projects depreciation expense by year and period for each item Automatically creates general ledger transactions o Transactions can be modified if needed; Separate transaction post to GL Primary book posts to Official layer Other posting books post to management layer

40 How QAD cuts administrative overhead GL Transactions Finally, look at the general ledger transactions, organized in the Fixed Asset daybook. Fixed Assets reduces administrative overhead by automating the flow of fixed asset information from capital project purchases through depreciation and retirement, creating all of the appropriate general ledger transactions for financial reporting and generating additional books to support multi-gaap and other reporting requirements. Demo 1. In Favorites, select GL Transaction View ( ) 2. Click Clear All 3. Enter Daybook Code equals FA 4. Click Add icon 5. Enter Posting Date equals 3/31/ Click Search 8. In Posting Date search, click Remove icon 9. Enter Records per Page All, Search

41 10. In Description heading, right-click 11. Select Group by Description 12. (Optionally) Expand Depreciation Key Points Daybook for Fixed Assets Categories transactions o Acquisition o Cost Adjustment o Depreciation o Retirement Automates process

42 Closing In closing, Fixed Assets provides a single place to record all fixed asset activity, integrated with Enterprise Asset Management to capitalize project expenses, and automatically creating General Ledger postings for asset acquisition, depreciation, retirement and transfer. Not only does this improve productivity, it reduces administrative time and helps eliminate costly errors. Enabling the Effective Enterprise! Fixed Assets Closing Financial Operating Efficiency - Automate manual processes - Improve productivity - Reduce administrative time - Eliminate costly errors Enabling the Effective Enterprise! Key Points Enabling the Effective Enterprise! o Reduce labor cost by 10 to 20% Financial Compliance KPI