From a capital purchase to the asset register

Receiving capital equipment drafts its fixed assets; finance reviews them on Accounting → Assets → Assets to Capitalise and capitalises each one, or says it is not an asset.

A machine, a laptop or a vehicle is bought like any other goods — requisition, purchase order, goods receipt — but it does not belong in stock. It belongs on the fixed asset register, depreciating. TRANXACT now carries it across: receiving it drafts the assets, and finance decides when each goes on the register.

What makes a purchase capital

• The item is marked Capitalizable. Open the item, go to Costing and tick Capitalizable. Choose its Asset class — the class decides the asset accounts and how long it is depreciated over — and say whether to raise One asset per unit received (on by default).
• Or it was ordered from a requisition in a spend category marked Capital purchases, whatever the item. Capital equipment is marked so from the start.

Which spend categories are capital

Which spend categories count as capital is your company’s choice. Under Platform → Configuration Lists → Spend categories, open a category and tick Capital purchases: goods received under it are added to Accounting → Assets → Assets to Capitalise as draft fixed assets. The list marks those categories “capital”. Clear the tick and goods bought under that category go into stock as usual. Until you change anything, only the built-in Capital equipment category is capital.

What a goods receipt does

Receiving such goods drafts one asset for each unit received — or for each serial number, when the units are serial-numbered — with its cost, the supplier, the purchase order and the goods receipt it came from. With One asset per unit received cleared, a receipt line becomes one asset for its whole quantity; serial-numbered units are always one asset each.

The receipt line shows the assets it drafted, and Accounting → Assets → Fixed Assets now has Goods receipt and Purchase order columns, so an asset can always be traced back to how it was bought.

Assets to Capitalise

Accounting → Assets → Assets to Capitalise lists everything that has arrived and is waiting to go on the register: what it is, its serial number, cost, class, the goods receipt and purchase order, who it was bought from, when it was received and where it is. A draft that cannot be capitalised yet — usually because it has no asset class — is flagged in Waiting for, which says what is missing.

1. On the asset’s row, choose Capitalise.
2. Asset class: needed when the item has none; choosing one here overrides the item’s.
3. In service from: the date depreciation starts. Left empty, today.
4. Useful life (months): left empty, the item’s, or else the class’s.
5. Save. The unit is taken out of stock, its cost moves from inventory to the class’s asset account, and depreciation starts from the in-service date.

If it should not be capitalised — below the capitalisation threshold, consumed in use, or bought on the wrong requisition — choose Not an asset and say why. The draft is cancelled and the goods stay in stock.

Returns, and receipts from before

• Returning goods to the supplier before they are capitalised cancels their draft assets.
• Goods received before this change were not drafted automatically. Add them to the register by hand on Fixed Assets.