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CCH Software User Documentation

FAQs

What are the main system limitations?

The main limitations of Fixed Asset Register are as follows:

  • The Fixed Asset Register requires the user to be licensed for CCH Accounts Production.
  • The Fixed Asset Register currently ignores Reporting Periods if they are set up in Accounts Production. All depreciation postings are dated on the last day of the Accounting Period.
  • The Fixed Asset Register lacks a concept of Location Codes to identify where an asset is located. It also ignores Accounts Production's Divisions if they are being used for this purpose.
  • Fixed Asset Register data is not included when a client is "travelled out" of Accounts Production or Corporation Tax. Also you cannot create a Fixed Asset Register on a travelled out client.
  • Fixed Asset Register fields are not available within CCH Reporting or SmartReports.

No Depreciation Calculated

If you enter a Bank Payment to buy an asset and analyse it in the Fixed Asset Register, sometimes no depreciation is calculated. The most likely reason for this is that:

  • the entry is dated on the last day of the year (which is the default date), and
  • the option to Calculate a Full Period's Depreciation in the Period of Acquisition?  is unticked

No depreciation is due in this situation.

A similar situation occurs when depreciation is calculated in the Fixed Asset Register, but none is posted when you Post Depreciation. You receive the message "Success - 0 journals posted". This can happen because you have unbalanced draft journals in Accounts Production. The depreciation journals are generated as draft journals but are not posted as the draft journals do not sum to zero. To resolve this, go into Journals and delete all the unposted journals. Then try Post Depreciation again.

Why does the system tell me I have a gap between Accounting Periods?

You are not allowed into the Fixed Asset Register if there is a gap between accounting periods in AP. This can happen if the year end date of one year has been edited without editing the year start date of the next year. This usually happens when there is a leap year:

  • Suppose we have a year ended 28/02/2015.
  • It is rolled forward and AP creates a year ended 28/02/2016.
  • Accounts are produced and the client is rolled forward again.
  • The roll forward creates a year from 29/02/2016 to 28/02/2016.
  • This looks somewhat strange, so the user edits the year start date to 01/03/2016.

This leaves a one day gap between the year ended 28/02/2016 and the year started 01/03/2016. You are then unable to access the Fixed Asset Register and receive the message that “There is a gap between the Accounting Periods after the period ended 28/02/2016. Edit the period dates in Statutory Database before continuing to Fixed Asset Register.” To resolve this, go into the earlier period, select Statutory Database > General > General information and edit the period end date to remove the gap. You can now go back to the current period and go into the Fixed Asset Register.

Notes

  • More rarely, you may see a similar message if the accounting periods overlap. The solution is the same. The Fixed Asset Register requires that AP uses a sequence of accounting periods with no gaps and no overlaps so that it knows when to calculate the cost and depreciation brought forward balances.
  • You may also see a message “Please access Fixed Asset Register from the corresponding FRS102 accounting period”. This happens if you have converted a client from UK GAAP to FRS102. AP creates comparative and precomparative FRS102 periods. If you try to access the Fixed Asset Register from the old UK GAAP comparative or precomparative period, you are asked to access it from the equivalent FRS102 period. 

What are Breadcrumbs?

Breadcrumbs are the term given to the navigation bar shown along the top of the Fixed Asset Register screens.

Breadcrumbs

The Breadcrumbs show the history of the screens that you pass through as you drill down into the Fixed Asset Register. If you hover over one of the blue labels in the list then it is underlined to indicate that it is a link. Clicking the link takes you to the relevant screen.

Notes

  • The first label in the Breadcrumbs also shows the client code and the current year end.
  • The last label in the list is disabled as it is the current screen and no link is required.

Can I override the depreciation calculated on an asset?

You cannot change the system's calculation of depreciation on an asset. But you can post an Adjustment entry that adjusts the calculated depreciation. For instance, if the system calculates £10 depreciation on an asset and you wish it to be £9, then you can post an Adjustment dated on the last day of the year with Depreciation set to -1.

How do I set up an asset with components with different useful lives?

The FAR does not support subassets. So if an asset is made up of component assets then each needs to be set up as a separate asset. However the Asset code can be quite long. So they could be indicated with codes such as PM00002/01, PM00002/02 and so on.

How do I handle a revaluation of an asset?

This often occurs with Freehold Property. This is performed using a Revaluation Movement. See Asset Movements.

How do I handle a change in the useful life of an asset?

An example is an extension of a lease. This is performed using a Change of Method Movement. See Asset Movements.

How do I set up an Asset Class with 3 nominals for Depreciation Cost of Sales, Distribution Costs and  Administrative Expenses?

The FRS102 chart of accounts has accounts for "Depreciation - Cost of Sales", "Depreciation - Distribution Costs" and "Depreciation - Administrative Expense". You can only specify one Depreciation Charge account  on an Asset Class. How can you get the correct analysis in the nominal ledger?

Suppose you are setting up an Asset Class for Motor Vehicles. There are two approaches:

  1. You could set up separate Asset Classes for "Motor Vehicles  - Cost of Sales",  "Motor Vehicles  - Distribution Costs" and "Motor Vehicles  - Administrative Expense". However most nominal accounts would be the same on all 3 of these Asset Classes.
  2. It is usually simpler to set up just one Asset Class for "Motor Vehicles" and post all depreciation to "Depreciation - Administrative Expense". At the end of the year you can then journal out a reasonable proportion of the total Depreciation Charge to the other two Depreciation accounts.

If you adopt the second approach, the balance on  "Depreciation - Administrative Expense" does not agree with the FAR depreciation charge for the year. This is partly why the posting accounts, such as Depreciation Charge, are not reconciled on the Asset Class screen.

Why is there no Master Asset Class for Investment Properties?

Under FRS102 Investment Properties have their own note in the accounts, separate from Tangible Fixed Assets. They are also regularly revalued to fair value and no depreciation is calculated on them. So it is probably more convenient to keep a record of Investment Properties outside the Fixed Asset Register and no Master Asset Class has been provided for them. 

What happens if I convert a client to a different entity?

Some clients can be converted to a different entity at Year End. For instance, a partnership can be converted to an unincorporated client. When you do this, the nominal accounts that are held in the Fixed Asset Register are not automatically converted to the nominals used by the new entity. So when you go into the Fixed Asset Register for the first time after converting you see the message:

The nominal accounts on some Asset Classes are invalid and must be corrected before you can use the Fixed Asset Register.

On clicking OK you are taken into the Setup screen where the invalid nominals are highlighted in red. To speed up correcting them, click on View on the Ribbon to see the Master Asset Class nominals which are probably the nominals that are required.

How do I enter Part Disposals?

The Fixed Asset Register does not hold a quantity balance for each asset. Suppose you have an asset called “6 chairs” and you wish to sell 2 of them. You should proceed as follows:

  • Create a new asset called “2 chairs”. Edit the name of the old asset from “6 chairs” to “4 chairs”.
  • In the Fixed Asset Register, enter an Adjustment on the old asset of 1/3 of the cost and depreciation, dated on the first day of the year. The balances on this entry will both be negative.
  • Enter an Adjustment on the new asset with the same cost, depreciation and date, but this time with positive balances. This transfers the cost and depreciation of 2 chairs to the new asset without any effect on the nominal ledger.
  • Now sell the new asset in the usual way, starting from Accounts Production.

Note that the above procedure does not affect the balances in the previous year. But if a Fixed Asset Register report is run in the previous year then the description of the asset appears as "4 chairs", even though 6 chairs were held at that time.

When the accounts are rolled forward, does the FAR get locked down so that the figures do not change?

The previous year’s FAR is not locked down unless you select Finalise Accounts in Accounts Production. If you don’t select Finalise Accounts, then you are able to make prior year entries:

  • If you go into the prior year in Accounts Production and then go into the FAR and make an entry dated in that year, the system accepts it without any warning. It also updates the opening cost and depreciation in the next year. But it doesn’t update the nominal ledger in the next year. So your opening cost and depreciation will not reconcile with the nominal balances in the next year.
  • If you go into the current year in Accounts Production and then go into the FAR and make an entry dated before the year start date, the system warns “This movement will affect earlier Accounting Periods. Are you sure?”

What would be “best practice” for the whole process of importing from VAP/Excel?

When importing from VAP/Excel, you should normally wait until you’ve rolled forward a year, then export the balances and import them as opening balances into the new year in FAR.

You can not do this mid-year, as Import from VAP will automatically assign the year start date to the imported balances. But if you have started the year, you could proceed as follows:

  • Reverse out any depreciation postings to date as well as any journals eliminating cost and depreciation on disposal.
  • Import the FAR assets and balances at the year start date.
  • In the FAR, add any asset movements corresponding to entries that have already been entered in the nominal ledger
  • Calculate Depreciation to regenerate the depreciation postings.

It is doubtful if you would want to do this if many fixed asset entries had already been made in Accounts Production, but it could be useful in some cases.

How do I treat grant-funded assets or assets bought under finance?

If the asset is grant-funded or bought on finance, it is shown in the fixed asset note in the accounts in the usual way. The cost of the addition as entered in the FAR is brought into Corporation Tax. The user can then decide on the tax treatment. It could be non-qualifying, or it could qualify but at a different tax value. Either of these scenarios can be specified in Corporation Tax, just as they are for an entry made manually.

 

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