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Oracle Financials for India User Guide Release 12.1

Part Number E13658-03 Contents Previous Next

India Local Fixed AssetsThis chapter covers the following topics:

  Fixed Asset Depreciation Calculation 

  Transactions 

  Reports 

Fixed Asset Depreciation Calculation

Businesses in India, under the Income Tax Act, have to compute depreciation using the “Written

Down Value” method. The depreciation percentage has to be applied on the Block of Assets andno depreciation can be claimed on individual assets.

Using India Localization, you can:

  Create Block of assets as required under the Income tax Act

  Record the block value of each Block of assets

  Define the depreciation percentage for each asset blocks

  Assign a block of asset to each asset addition

  Identify the block of assets for each asset, which are being retired during the year

  Perform adjustments in the opening written down value of any block and adjustments in

the depreciation worked out in any year.

Note: It may be noted that localization provides only the reports showing the workings of 

depreciation based on block of assets. No accounting entries will be passed on the figuresderived through localization will not be considered for any accounting entries automatically.

The Tax Handling functionality provides you with the information requirements under IncomeTax Act. You can:

  Define multiple blocks of assets and associate individual assets to each block of assets.

  Define depreciation periods. These periods would be in sync with the financial year

defined under the Income Tax Act.

  Specify multiple period rates for each depreciation period. You can define multiple

periods and applicable rate percentage for each period. The depreciation amount wouldbe proportionate to the rate percentage specified for each period.

  Specify date of commissioning and enable calculation of depreciation based on the date

of commissioning.

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  Define the opening written down balances along with depreciation rates at the beginning

of the year during which you would be rolling out Oracle Assets with India Localization.This information would be used for the computation of depreciation for the year.

  Adjust opening written down value and depreciation amounts.

  Calculate depreciation in accordance with Income Tax Act.

 Generate depreciation schedule.

Major Features

Definition of Block of Assets: User will be able to define block of assets by having the asset

categories defined with highest level of details as required for Income Tax.

Opening Balance of Block of Assets: User is provided with a facility to enter Opening balances

for block of assets (one time facility). User is provided with a report, which will facilitate

arriving at asset category wise, Gross Block of Assets and written Down Value as required forIncome Tax purpose.

Periodical Closing Balances of Block of Assets: User is provided with a facility generatemonthly closing balances of Block of assets.

Transactions

Various Transactions India Localization Supports in Fixed Assets are mentioned in this section.

Asset Additions

While recording the additions of assets in Oracle assets, the user need to allocate the individual

asset to the Block of assets defined. The block details of the assets need to be assigned byrecording the details in the flex field. You need to enter localization details in Asset Categories

flexfield while additions through Quick Additions and New Additions. While you would be

entering these details in Mass Additions Flex field while adding assets through Prepare MassAdditions. On recording the complete asset related information including asset book and cost of 

the asset, user need to click on the flexfield and select the context value as India B Assets.

Before you enter the Asset Additions, you must:

  Define Books

  Define Asset Category

  Define Quick Codes (for Block of Assets)

  Define Depreciation Period Details

Navigate to Assets > Asset Workbench > Quick Additions/New Additions > Asset Category.

User will have to complete the asset addition in Base FA and come to the India Localization

screen to assign the block of asset and date of acquisition.

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The user has the flexibility to assign a block name to multiple assets at one go which will

increase the usability significantly.

Also, the date placed in service (which is given at the time adding the asset) will be defaulted as

the Date of Acquisition. This date can be changed by the user.

Field Name Type Action Description

Block of 

Assets

PICK

HELP

Users need to enter the relevant Block of Assets in which the

asset will be classified as per Indian Income Tax Act.

Date of 

Acquisition

User need to record the date on which the asset was acquired

Income Tax Depreciation Calculations

The calculation of written down value of the Block of asset is worked out based on the

prescribed calculations that need to be carried out under Income Tax Act.

Opening Written down value of the block (as at the beginning of the assessment year)

Terms Descriptions

Add Additions during the assessment year

Less Retirements of asset from each individual assets

Less Depreciation on the opening written down value of the block 

Less Depreciation on the additions during the first half of the assessment year

Less Depreciation on the additions during the second half of the assessment year

= Closing written down value of the block of asset

Run Depreciation

For calculating the depreciation under Income Tax Act, users need to run a concurrent program

manually. The program is named as Income Tax Act fixed asset schedule. On completion of the

program, users can view and print the output and the closing written down value will get

updated.

Income Tax Act fixed asset schedule concurrent program

Users need to run Concurrent request to Calculate Depreciation for a Financial Year.

In India Localization, navigate to the Income Tax Act Fixed Asset Schedules concurrent program

as follows:

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Request Name: Income Tax Act Fixed Asset Schedules

The parameters for this request are described in the table below:

Field

Name

Type Action Description

Start

Date

(Required) Users need to enter start date from the LOV of a Financial year to

run the depreciation calculation. Since the financial year for the

Income Tax purpose is 1st April to 31st March this start date use tobe 1st of April of a year.

End

Name

(Required) System will consider the End date as 12 month ending from the

above start date.

Book 

Name

(Required) The User need to enter Book Name where in the Depreciation

Calculation is need to be done.

After completion of Run Depreciation, users can view the Fixed Assets Schedule as per IncomeTax Act (Block wise) through Reports. If the user needs to add an unplanned depreciation, it can

be done in the Depreciation adjustment column of Opening WDV Balance form. Unplanned

Depreciation amount will be shown separately in the report output.

Reports

Fixed Assets generates these reports for India:

  India Income Tax Fixed Assets Schedule - This report is a Fixed Asset Schedule as per

Income Act, provides details of Block of Assets.

  India Depreciation Detail Report - This report provides information on depreciation

calculated for each asset.

India Income Tax Fixed Assets Schedule

This report is a Fixed Asset Schedule as per Income Act, provides details of Block of Assets.Use the Submit Requests (India Local Fixed Asset ) form and enter India-Depreciation for one

year in the Name field to submit the report.

  F.Y Start Date: Financial year start will be available in the LOV, Once the start date isentered, the system will take the end date as end of the Financial year. The user need to

enter the relevant Corporate book name for which the Income Tax Fixed Assets schedule

is to be taken. Report headings provide you with general information about the contentsof the report . Oracle lists Corporate Book name and financial year details based on User

parameter input.

  S.No: Serial Number for the Block of Assets will be reported

  Type: Block of Assets name will be reported

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  Period: Depreciation period in a financial year will be reported

  Opening WDV as on start date of a Financial year: Opening Written Down Value fora Block will be reported

  Addition during the year: Addition made during the year to a Block will be reported

  Deletion and Sale in the year: Deletion and Sale during the year to a Block will be

reported  Deletion and Sale in the year: Deletion and Sale during the year from a Block will be

reported

  Total: Total of WDV balance for a Block before applying depreciation Block will bereported

  Rate of Depreciation: Rate of Depreciation for a block will be reported

  Depreciation for the year: Depreciation for a block for the year will be reported

  Closing WDV as on End date of a Financial year: Closing Written Down Value for a

Block will be reported

India Depreciation Detail Report

  Start Date: Financial year start will be available in the LOV, Once the start date is

entered.

  End Date: End date as per User requirement can be entered.

  Level of details: The user can specify either a Detailed Report or a Summary Report

according to his requirement. Detailed report will provide complete assets details andSummary Report will provide Block wise details for multiple years.

  S.No: Block of Assets name will be reported

  Period: Period for which report is submitted

  Opening WDV as on start date of a Financial year: Opening Written Down Value fora Block will be reported

 Addition during the year: Addition made during the year a financial year to a Block asset wise will be reported

  Assets Number: Assets Number added to a Block during the financial years will bereported

  Deletion and Sale in the year: Deletion and Sale during the financial years of an asset

will be reported

  Deletion and Sale in the year: Deletion and Sale during the year from a Block for an

asset will be reported

  Total: Total of WDV balance for a Block before applying depreciation Block will bereported

  Rate of Depreciation: Rate of Depreciation for a block will be reported. Depreciation for

a block for the year will be reported  Closing WDV as on End date of a Financial year: Closing Written Down Value for a

Block will be reported

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