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Buying a Fixed Asset

When you have bought a fixed asset, you need to go through two steps to complete the registration of the asset and its purchase.

  1. Add the fixed asset account
  2. Enter the supplier invoice for the asset

Add the Fixed Asset

Before you can enter the supplier invoice for the asset, you have to create the asset in the system. When you create a fixed asset, you register some details about the fixed asset which are used by the system to depreciate the fixed asset over time.

You create a fixed asset by going to Financials » Fixed Assets » P71 Fixed Asset List.

If you have already added fixed assets you will see a list of Fixed Assets and you can click the [New] button at the top of the screen to add one.
If you have not yet added fixed assets you will see a message box saying that there is no data to show. Click [OK] and you are taken to the Customise Report screen. On the bottom right is a button labelled [Add Asset]. Click this button to add a fixed asset.

You can find more help on how you add a fixed asset here.

Enter the Supplier Invoice for the Asset

You enter the supplier invoice for fixed assets in the same way that any other supplier invoices and expenses are entered. Instead of selecting an expense account, you select the fixed asset account that you just created. Proceed with entering the price of the fixed asset in the Amount field. Unless there are additions to a fixed asset, you should not enter more than one supplier invoice for any fixed asset.

Expenses Associated with a Fixed Asset

If the supplier invoice containing the fixed asset also contains other products, these products need to be separated from the fixed asset itself. You do this by entering the fixed asset and the other products on separate lines when you enter the purchase. Click here for more information on how to split supplier invoices.

If you get expenses related to an asset during the asset's life, these expenses should not be entered on the asset itself. These are other expenses and you should find the appropriate expense account for such expenses. The reason for this is that assets are depreciated over time, based on the initial cost of the asset. If you add other expenses or transactions on the fixed asset, it will have unwanted implications for the depriation process.