How Can I Do An Asset Split?

There are two methods to do an Asset split. On the Asset Panel Depreciation Tab, there is a ‘Split’ option that can be activated. This will allow depreciation to be split among up to 5 Organizations for a single asset. If you do not see the split option then from the BarScan Main Menu select File-> Company-> Housekeeping-> Settings. On this panel select the ‘Depreciation/Currency’ tab and place a check mark in ‘If checked allow Users to see Depreciation Splitting among Organizations’ to make this type of split visible on the Asset Panel’s Depreciation tab. If this is not how you wish to do an Asset Split, continue reading.

The second method splits what is originally considered a single asset into several separate assets while continuing the depreciation that has already been started. To recap, this method splits an asset already being depreciated into several new assets when the current depreciation method is ‘Straight Line’.

Each new split asset has its own location, percentage of the original basis, organization, etc. Note that this article describes one way to do the split, but it may not be applicable for your accounting requirements.

How to do the Split.

1. Make sure that there are no pending changes to the asset. If there are, do a ‘Cancel’ operation on the asset.

2. Accumulate information need for the split. How to determine the values specified is found under “information Needed for the Split” found below.

a. Determine the calculated ‘Last Calc Date’ as listed under “Information Needed for the Split”

b. If the current asset’s actual ‘Last Calc Date’ is different from the calculated ‘Last Calc Date’ determined under “Information Needed for a Split” enter the calculated ‘Last Calc Date’ value into the ‘Last Calc Date’ of the original asset, then ‘Save’ the asset. The calculated ‘Last Calc Date’ should now be the same as the actual ‘Last Calc Date’.

c. Determine the remaining values under “Information Needed for the Split”, such as the Split Date, Additional Basis, Life Remaining, etc. Note that when making the list of new Assets, be sure to have well in mind the list of asset numbers along with any corresponding new locations, etc. Do not hesitate to write these down ahead of time if needed.

3. Using the ‘Add Template’ button copy the original asset, entering the information needed for each of the new assets that you have determined that you need to make. For each new asset:

a. Change the Asset number to one of the new Asset numbers.

b. Under the ‘Basis’ tab

i. Set the ‘Purchase Cost’ to the calculated Total Cost for each new asset. For example, if the Remaining Book of the original asset is $100, five new assets would have $20 entered into each Purchase Cost field for each new asset.

ii. Set the ‘Additional’ field value to the new calculated Additional Basis for the new asset. (For example, if the Additional Basis of the original asset is $20, five new assets would have 4 entered into the ‘Additional’ field for each new asset.)

iii. Clear all other Valuation fields on the Basis Tab.

c. Under the ‘Inventory’ tab.

i. Clear the ‘Disposal Date’.

ii. Enter a remark similar to ‘SPLIT FROM ###’ where ### is the original asset number.

d. Under the Depreciation tab.

i. Change the ‘Life (#of Periods)’ to the newly calculated Life Remaining. For example, if the original asset has a life of 36 months and 3 months have already been depreciated, the value to enter would be 33.

ii. Change the ‘Start Date’ to the newly determined Split Date.

iii. Change the ‘Last Calc Date’ to the Split Date. The last calc date can be re-entered just like any other Last Calc date for any other asset.

e. Under the ‘Depreciation History’ tab.

i. If the ‘Use Depreciation History’ checkbox has a checkmark, clear it then re-check it. This will force a recalculation of the Depreciation History.

f. Add any other asset specific information, such as a new location or a new organization. Note that since this asset is a split from a master asset, the default is for the location history to continue with all previous entries. In the unlikely case that you do not want this, the time to clear the location history is before any new locations are entered.

g. Save the new asset.

4. Update the original asset.

a. Under the Inventory Tab

i. Set the Disposal Date to the newly determined Last Calc Date. This is normally the month just prior to the Split Date.

ii. Set one or more of the remarks to document the split.

b. Save the updated asset.

The end result are new assets that have a total valuation equal to the Remaining Book of the original asset, while the original asset still exists with its own amount of depreciation that stops just before the depreciation for all of the new assets begins.

Information Needed for the Split

You will need to determine the following information for each asset being split. These values will be required once you start doing the split. Some values are calculated, some values are gathered from asset labels, others from inventory information.

1. The calculated Last Calc Date. This is the date for which the asset has had its last depreciation calculated. Normally you can use the ‘Last Calc Date’ value listed on the Asset Panel. However, when doing a split, it is necessary to double check that the ‘Last Calc Date’ for the asset is accurate. If the asset is using Depreciation History, then the calculated ‘Last Calc Date’ is actually the date of the last Depreciation History entry.

2. The Split Date. This is the official date that you want to split the single composite asset into several assets. Note that the split date MUST be AFTER the calculated “Last Calc Date” determined above and CANNOT be in the same month. Normally, the split date will be in the next month after the calculated Last Calc Date.

3. The Additional Basis. This is the value being added or subtracted from the Basis of the original asset. Often an asset split is prompted by some event. For example, new inventory has come in, a partial shipment has finally been completed or there has been a theft of parts of an asset. Since this is a composite asset, each of these calls for an addition or subtraction to the Basis of the asset. This Additional Basis is not required and can be zero.

4. The Life Remaining (i.e., the number of periods remaining in the depreciation of the original asset). Subtract the total number of months already depreciated (up through the calculated Last Calc Date) from the ‘Life (#Periods)’. For example, if the original asset has a life of 36 months and has already been depreciated for 3 months as of the Last Calc Date, the Life Remaining is 33 months.

5. The list of new Asset numbers, along with how many there are. You should not include the original asset # in this count. If you are going to split one asset into several you need a list of the new asset numbers. If you are going to apply physical labels, now is the time to obtain or print them. Make sure a list of the asset numbers is handy so that you can enter them into BarScan later. If it makes it easier, a char can be made listing each new asset with its corresponding calculated information.

6. The calculated ‘Total Cost’ for each new asset. This is the ‘Remaining Book’ of the original asset divided up into the new assets. If you are dividing the original asset evenly among all of the new assets this is the original ‘Remaining Book’ divided by the number of new assets. Don’t forget to allocate any remainder. E.g., if the original value is 100 and is divided into 3 assets, each asset will get 33.33, but the last one should get 33.34 so that the previous amount equals the sum of all of the new assets.

7. The calculated Additional Basis for each new asset. This is calculated in the same manner as the new Total Cost for each new asset. The ‘Additional Basis’ obtained above is split among the new assets.