Oracle Financials

Cloud

Implementing Assets

20B
Oracle Financials Cloud
Implementing Assets

20B
Part Number F27552-01
Copyright © 2011, 2020, Oracle and/or its aliates.

Author: Gail D'Aloisio

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Oracle Financials Cloud
Implementing Assets

Contents

Preface i

1 Overview of Assets Implementation 1

Overview of Assets Rapid Implementation .............................................................................................................................. 1
Implement Assets .......................................................................................................................................................................... 1

2 Assets Flexelds 5
Asset Category Key Flexeld ...................................................................................................................................................... 5
Asset Key Flexeld ........................................................................................................................................................................ 5
Location Flexeld .......................................................................................................................................................................... 6
Assets Descriptive Flexelds ...................................................................................................................................................... 6
Asset Category Descriptive Flexeld ........................................................................................................................................ 9
System Controls ............................................................................................................................................................................ 9

3 Asset Books 11
Guidelines for Creating or Modifying Asset Books .............................................................................................................. 11
Create a Corporate Book ........................................................................................................................................................... 12
Create a Tax Book ....................................................................................................................................................................... 14
Fiscal Years ................................................................................................................................................................................... 16
Considerations for Creating Calendars ................................................................................................................................... 16
Create an Asset Calendar .......................................................................................................................................................... 17
Prorate and Retirement Conventions ..................................................................................................................................... 18
Overview of Capitalization Threshold Amounts ................................................................................................................... 19
Enable Capitalization Thresholds ............................................................................................................................................ 20
Set Capitalization and Low Value Thresholds ....................................................................................................................... 21
Validate Capitalization Threshold Results ............................................................................................................................. 22

4 Depreciation Methods 23
Depreciation Methods ................................................................................................................................................................ 23
Set Up a Life in Periods Depreciation Method ..................................................................................................................... 25
Use a Life in Periods Depreciation Method .......................................................................................................................... 25
Oracle Financials Cloud
Implementing Assets

5 Asset Categories 27
Overview of Asset Categories .................................................................................................................................................. 27
Create an Asset Category ......................................................................................................................................................... 30
Create a Lease Category ........................................................................................................................................................... 32

6 Optional Setup Steps 35

Dene Cash-Generating Units ................................................................................................................................................. 35
Use a Cash-Generating Unit ..................................................................................................................................................... 35
Price Indexes ................................................................................................................................................................................ 36
Create a Price Index ................................................................................................................................................................... 36
Assets Prole Options ................................................................................................................................................................ 37
FAQs for Assets Conguration ............................................................................................................................................... 40
What's a cash-generating unit? .............................................................................................................................................. 40
Why can't I change a cash-generating unit's assignments? ............................................................................................. 40
Oracle Financials Cloud Preface
Implementing Assets

Preface
This preface introduces information sources that can help you use the application.

Using Oracle Applications

Help
Use help icons to access help in the application. If you don't see any help icons on your page, click your user image
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Watch: This video tutorial shows you how to nd and use help.
 
You can also read about it instead.

Additional Resources
• Community: Use Oracle Cloud Customer Connect to get information from experts at Oracle, the partner
community, and other users.

• Training: Take courses on Oracle Cloud from Oracle University.

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Convention Meaning

boldface Boldface type indicates user interface elements, navigation paths, or values you enter or select.

monospace Monospace type indicates le, folder, and directory names, code examples, commands, and URLs.

> Greater than symbol separates elements in a navigation path.

i
Oracle Financials Cloud Preface
Implementing Assets

Documentation Accessibility
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Oracle Financials Cloud Chapter 1
Implementing Assets Overview of Assets Implementation

1 Overview of Assets Implementation

Overview of Assets Rapid Implementation

You can use the Rapid Implementation integrated workbook template to rapidly implement Oracle Fusion Assets and
set up the following objects:

• Key exeld structure

• Categories
• Locations
• System controls
• Depreciation calendars
• Prorate conventions
• Asset books

Use the standard Dene Fixed Assets Conguration task lists for Assets congurations that cannot be set up or updated
using the rapid implementation approach.

Tasks
You must perform the following tasks in the Dene Fixed Assets Conguration for Rapid Implementation task list to
rapidly implement Assets:

Task Description

Create Fixed Assets Conguration in Downloads the rapid implementation Excel integrated workbook template. You must use this
Spreadsheet template only for initial conguration. Do not use it to make additional changes.
   

Update Fixed Assets Conguration in Downloads the rapid implementation integrated workbook template. You must use this
Spreadsheet template to review, modify, or add to the existing conguration.
   

Upload Fixed Assets Conguration in Calls the Upload Fixed Assets Conguration process from the Scheduled Process page with
Spreadsheet the data le as a parameter. You upload the le generated from the spreadsheet template and
  monitor the process to make sure it completes successfully.
 

Note: The Create Fixed Assets Conguration in Spreadsheet task lets you create only a monthly depreciation
calendar. You can create any depreciation calendar using the Update Fixed Assets Conguration in
Spreadsheet task.

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Oracle Financials Cloud Chapter 1
Implementing Assets Overview of Assets Implementation

Implement Assets
Get started with Oracle Fusion Assets and enable your reporting and accounting capabilities using the Dene Fixed
Assets Conguration for Rapid Implementation task list. This task list provides a framework to develop and manage
your Assets exelds, system controls, scal years, locations, calendars, prorate conventions, asset books, and asset
categories.

Value Sets

Locations
Flexfields:
Asset Key
Location Values
Asset Category
Fiscal Years
Values
Calendars

Categories Prorate Conventions

System Controls Books

Set Up Assets
The tasks in the following list relate to the setup of Oracle Fusion Assets. These are the basic steps for setup. These
tasks appear in the setup task list in the Setup and Maintenance work area. However, in your task list the tasks may be
interspersed with other tasks that you don't need to perform before you can use Oracle Fusion Financials.
For seing up Assets, each task is performed by the Application Implementation Manager.

Dene Fixed Assets Conguration for Rapid Implementation

All documentation references are from the Oracle Financials Cloud Implementing Assets guide, unless otherwise noted.

1. Create Fixed Assets Conguration in Spreadsheet.

◦ Perform the task Create Fixed Assets Conguration in Spreadsheet to dene your initial Fixed Assets
conguration or rapidly implement Oracle Fusion Asset categories, system controls, depreciation
calendars, prorate conventions, and books.
◦ See: Oracle Applications Cloud Conguring and Extending Applications guide.

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Oracle Financials Cloud Chapter 1
Implementing Assets Overview of Assets Implementation

2. Update Fixed Assets Conguration in Spreadsheet.

◦
Perform the task Update Fixed Assets Conguration in Spreadsheet to update or add to your Oracle
Fusion Asset categories, locations, and books.
3. Upload Fixed Assets Conguration in Spreadsheet.

◦ Perform the task Upload Fixed Assets Conguration in Spreadsheet to load the key exeld
structure, system controls, calendar, prorate convention, asset book, location combination, and category
assignment to the book created or updated in the spreadsheet.

Related Topics
• Oracle Financials Cloud Implementing Assets
• System Controls
• Depreciation Methods

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Oracle Financials Cloud Chapter 1
Implementing Assets Overview of Assets Implementation

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Oracle Financials Cloud Chapter 2
Implementing Assets Assets Flexelds

2 Assets Flexelds

Asset Category Key Flexeld

Dene the Asset Category key exeld so that you can create categories and group assets by nancial information in
relevant categories. Dene your Asset Category exeld segments to t the specic needs of your organization. You
must dene at least one subcategory segment to allow for distinctions within a major category.
You can dene up to seven segments for your Asset Category key exeld. When dening segments, consider the
following:
• Oracle Fusion Assets only displays a limited number of characters on its forms and reports, so you may want to
use only two or three segments so that all of them can be displayed.
• You must dene depreciation rules for each category exeld combination, so more segments require more
setup and maintenance eort.

Note: Plan your exeld carefully. Once you begin entering assets using the exeld, you cannot change it.

Related Topics
• How Flexelds Work with Oracle Application Cloud Architecture
• Overview of Key Flexelds
• Overview of Value Sets

Asset Key Flexeld

Use the Asset Key exeld in Oracle Fusion Assets to group your assets by non-nancial information. You design your
Asset Key exeld to record the information you want.
When designing the Asset Key exelds, consider the following:
• You can assign the same asset key to many assets to easily nd similar assets.
• All Assets transaction pages allow you to query assets using the asset key, and help you nd your assets
without an asset number.

Even if you choose not to track assets using the asset key, you must dene at least one Asset Key exeld segment
without validation because the Asset Key exeld structure is required to set up the system controls.

Note: Plan your exeld carefully. Once you begin entering assets using the exeld, you cannot change it.

Related Topics
• How Flexelds Work with Oracle Application Cloud Architecture
• Overview of Value Sets
• Overview of Key Flexelds

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Oracle Financials Cloud Chapter 2
Implementing Assets Assets Flexelds

Location Flexeld
Oracle Fusion Assets uses the Location exeld to group and track your assets by physical location. Dene the Location
exeld structure to t the specic needs of your organization. You must choose:
• The number of segments
• The length of each segment
• The name
• The order of each segment

You must dene a state segment and up to six other location segments.

Examples:
• You do business internationally and want to track the country an asset is in. You may also want to include
segments for state, city, and site.
• You use barcodes and want to track asset locations in more detail, so you add segments for the building and
room number.

The location name (all segments concatenated) appears on forms and reports, which display only a limited number of
characters. You may want to abbreviate some location segment values.

Note: Plan your exeld carefully. Once you begin entering assets using the exeld, you cannot change it.

Related Topics
• How Flexelds Work with Oracle Application Cloud Architecture
• Overview of Value Sets

Assets Descriptive Flexelds

You can record and track all standard asset information on the Assets pages. However, there may be additional
information you need to record for your assets that needs to be tracked for reporting purposes. You can set up
descriptive exelds to record and track additional information in Assets. You can set up a descriptive exeld for
each asset category to collect information relevant to your business. For example, you can track the license number
for cars and the square footage for buildings. When you assign a new asset to a category, you can enter the additional
information in a descriptive exeld.
The following table lists the descriptive exelds available in Assets and their corresponding Assets pages:

Descriptive Flexeld Associated Assets Page

Asset Category Add Asset

   
Edit Source Line
 
Add Assets and Prepare Source Lines spreadsheets
 

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Implementing Assets Assets Flexelds

Descriptive Flexeld Associated Assets Page

Assets Invoices Add Asset

   
Edit Source Line
 
Add Source Lines
 
Change Source Lines
 
Source Line Retirement
 
Add Assets and Prepare Source Lines spreadsheets
 

Bonus Rates Create Bonus Rule

   
Edit Bonus Rule
 

Bonus Rules Create Bonus Rule

   
Edit Bonus Rule
 

Book Controls Create Book

   
Edit Book
 

Calendar Types Create Calendar

   
Edit Calendar
 

Categories Create Category

   
Edit Category
 

Category Books Create Category

   
Edit Category
 

Category Book Defaults Create Category

   
Edit Category
 

Ceilings Create Ceiling

   
Edit Ceiling
 

Convention Types Create Prorate Convention

   
Edit Prorate Convention
 

Fiscal Year Create Fiscal Year

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Oracle Financials Cloud Chapter 2
Implementing Assets Assets Flexelds

Descriptive Flexeld Associated Assets Page

   
Edit Fiscal Year
 

Flat Rates Create Depreciation Method

   
Edit Depreciation Method
 

Locations Manage Locations

   

Methods Create Depreciation Method

   
Edit Depreciation Method
 

Retirements Cost Retirement

   
Unit Retirement
 
Source Line Retirement
 

System Controls Manage System Controls

   

Transactions Add Asset

   
Edit Source Line
 
Preview Add to Asset
 
Change Financial Details
 
Suspend Depreciation
 
Add Source Lines
 
Change Source Lines
 
Transfer Source Lines
 
Change Category
 
Perform Unplanned Depreciation
 
Transfer Reserve
 
Change Group Asset
 
Cost Retirement
 
Source Line Retirement
 
Unit Retirement
 
Transfer Asset
 
Adjust Units
 

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Oracle Financials Cloud Chapter 2
Implementing Assets Assets Flexelds

Descriptive Flexeld Associated Assets Page

Add Assets and Prepare Source Lines spreadsheets

 

Related Topics
• How Flexelds Work with Oracle Application Cloud Architecture
• Overview of Value Sets
• Overview of Descriptive Flexelds

Asset Category Descriptive Flexeld

Set up the Asset Category descriptive exeld to store additional information based on the asset category.
• Enter the category code as the reference eld to base the descriptive exeld structure on the value of your
Asset Category exeld.
• Dene your context eld values (structure names) to exactly match your concatenated Asset Category Flexeld
combinations.

For example, your Asset Category Flexeld combination is BUILDING.OFFICE. You dene BUILDING.OFFICE as your
context value.

Note: The segment separator, spelling, and case must exactly match your Category Flexeld combination.

You don't need to dene a descriptive exeld structure for each combination of your Asset Category exeld. Dene
structures only for those categories in which you want to capture additional information (such as the license number or
insurance policy number).

Note: Plan your exeld carefully. Once you begin entering assets using the exeld, you can't change it.

Related Topics
• How Flexelds Work with Oracle Application Cloud Architecture
• Overview of Value Sets
• Overview of Descriptive Flexelds

System Controls
System controls provide information about the structure of your company.
Dene system controls by identifying:

• Your enterprise (company) name

• The oldest date placed in service

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Oracle Financials Cloud Chapter 2
Implementing Assets Assets Flexelds

• Your exeld structures

• Your asset numbering scheme

Enterprise Name
The enterprise name establishes the name that appears on Oracle Fusion Assets reports.

Oldest Date Placed in Service

The oldest date placed in service controls what dates are valid to place assets in service and on what date to begin your
calendars. You can only update the oldest date placed in service before you assign any calendars to depreciation books.

Flexeld Structures
Dene your company's Category, Location, and Asset Key exelds structures, which will be used to record
transactions.
Congure exeld segments to capture data that represents the values of aributes. You can dene any number of
segments for each exeld, but Assets supports only one structure. The administrator must choose a structure for each
key exeld that will be used to record transactions.

Automatic Asset Numbering

The starting asset number denes the number to begin automatically numbering your assets. Note that some asset
numbers may be skipped.
When you use automatic numbering, then manual numbering must be less than the starting asset number that you
have established. In other words, if you start automatic numbering at 50,001, manual numbering must be between 1
and 50,000. Asset numbers with a leer in them are not reserved for automatic asset numbering, since the automatic
numbers are a numeric sequence.

If you are converting from another application, you can enter a starting number greater than the number of assets
you want to convert so converted assets keep the same number from the previous application. For example, if you are
converting 75,000 assets, you can enter 100,001 as the starting number to reserve the numbers 1 to 100,000 for manual
asset numbering. Note that adding the 75,000 assets will increment the automatic numbering sequence by 75,000
(automatically numbered assets will begin at 175,001).

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

3 Asset Books

Guidelines for Creating or Modifying Asset Books

You can set up an unlimited number of independent asset books. Each book has its own set of depreciation rules,
accounts, and calendars to organize and implement your xed assets accounting policies more eectively. You must set
up your asset books before you can add assets to them.
An asset can have dierent nancial information and depreciation rules in each book. For example, you can make
the asset cost in your tax book dierent from the cost in the associated corporate book. Because the books are
independent, you can run depreciation for each book on a dierent schedule.

In Oracle Fusion Assets, user access to the data is secured at the asset book level. Each user can view and update the
assets only in the asset book to which they have access.

While dening your asset books you need to select the reference data set for the following set up and lookup objects:

• Bonus Rules
• Depreciation Ceilings
• Depreciation Methods
• Descriptions
• Prorate Convention
• Queue Name
• Retirement Type
• Unplanned Type

While dening these set up and lookup objects, you need to use the same reference data set value that you assigned to
the book for which these are created. While adding an asset or performing any transaction on an asset in the book, you
will see only the setup object values that share the reference data set with this book.

Before you can set up an asset book, you must have completed seing up the following:

• Dene ledgers
• Dene asset accounts
• Dene system controls
• Dene scal years
• Dene calendars
• Dene prorate conventions
• Dene reference data sets

You can dene the following types of asset books:

• Corporate
• Tax

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

Corporate Books
An asset can belong to any number of tax books, but must belong to only one corporate book. New or existing assets
must rst be added to a corporate book and then can be easily copied to all the associated tax books.
You can set up multiple corporate books that create journal entries for dierent ledgers, or for the same ledger. In either
case, you must run depreciation and create journal entries for each book. For each corporate book, you can set up
multiple tax books and associate all of them to the corporate book.

Tax Books
A tax book must be associated with a corporate book so that the assets and transactions are easily copied from the
corporate book. This helps to maintain multiple accounting and depreciation representations for assets with minimal
eort.

Tax books can have dierent calendars than their associated corporate books, as long as both calendars uses the same
scal year. You can use the tax rules to control what transactions need to be copied from the corporate book to the tax
book.

You can associate the tax book to ledger of its corporate book or to a dierent ledger. You can also optionally create
journal entries and transfer to your general ledger. The dierent ledger must be a secondary ledger of the ledger
assigned to the corporate book and the following conditions must be satised:

• Enable Oracle Fusion Subledger Accounting and set Use Primary Ledger Amounts to No in the accounting
options of the secondary ledger setup.
• Enable Assets for Subledger Accounting for the secondary ledger.

Create a Corporate Book

This example shows how to create a corporate book in Oracle Fusion Assets.

Create a Corporate Book

1. Navigate to the Manage Books page.
2. Click the Create icon.
3. On the Create Book page, complete the elds as shown in this table:

Field Value

INF USA CORP

Name  

InFusion USA Corporate Book

Description  

Corporate
Book Class  

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

Field Value

Note: When you dene a corporate book, the name of the corporate book you are dening is
populated automatically into the Associated Corporate Book eld.
 

InFusion USA PL
Ledger  

MTH CAL
Depreciation Calendar  
Note: The Fiscal Year Name is populated automatically.

MTH CAL
Prorate Calendar  

Enter the current month and year.

Current Period  

Evenly
Divide Depreciation  

Enter the last date of the previous month.

Last Depreciation Run  

4. Check the following check boxes:

◦ Depreciate if retire in the rst year
◦ Allow amortized changes
◦ Allow cost sign changes
◦ Allow ledger posting
5. In the Accounts region, enter the following account information:

Field Value

101. 10. 78990. 000.000.000

Enter Account Defaults  

78530
Net Book Value Retired Gain  

78540
Net Book Value Retired Loss  

78510
Proceeds of Sale Gain  

78520
Proceeds of Sale Loss  

15930
Proceeds of Sale Clearing  

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

Field Value

78530
Cost of Removal Gain  

78540
Cost of Removal Loss  

24220
Cost of Removal Clearing  

68800
Deferred Depreciation Expense  

16800
Deferred Depreciation Reserve  

6. In the Rules region, Reference Data Groups tab, accept the default Reference Data Set Code for all reference
data objects.
7. In the Rules region, Group Rules tab, check all check boxes.
8. Click Save and Close.
9. Click Done.

Create a Tax Book

This example shows how to create a tax book in Oracle Fusion Assets.

Create a Tax Book

1. Navigate to the Manage Books page.
2. Click the Create icon.
3. On the Create Book page, complete the elds as shown in this table:

Field Value

INF USA TAX

Name  

InFusion USA Tax Book

Description  

Tax
Book Class  

INF USA CORPORATE

Associated Corporate Book  

InFusion USA PL
Ledger  

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Implementing Assets Asset Books

Field Value

QUARTER CAL
Depreciation Calendar  
Note: The Fiscal Year Name is populated automatically.

MTH CAL
Prorate Calendar  

Enter the current month and year.

Current Period  

Evenly
Divide Depreciation  

Enter the last date of the previous month.

Last Depreciation Run  

4. Check the following check boxes:

◦ Depreciate if retire in the rst year
◦ Allow amortized changes
◦ Allow cost sign changes
◦ Allow ledger posting
5. In the Accounts region, enter the following account information:

Field Value

101. 10. 78990. 000.000.000

Enter Account Defaults  

78530
Net Book Value Retired Gain  

78540
Net Book Value Retired Loss  

78510
Proceeds of Sale Gain  

78520
Proceeds of Sale Loss  

15930
Proceeds of Sale Clearing  

78530
Cost of Removal Gain  

78540
Cost of Removal Loss  

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

Field Value

24220
Cost of Removal Clearing  

68800
Deferred Depreciation Expense  

16800
Deferred Depreciation Reserve  

6. In the Rules region, Reference Data Groups tab, accept the default Reference Data Set Code for all reference
data objects.
7. In the Rules region, Group Rules tab, check all check boxes.
8. In the Tax Rules region, check the Allow mass copy check box.
9. Click Save and Close.
10. Click Done.

Fiscal Years
A scal year is a standard set of periods used to prepare annual nancial statements for reporting and tax purposes.
Fiscal years:

• Usually represent twelve monthly periods, but this varies by business and country.
• Can also be referred to as a nancial year or a budget year.

When seing up scal years, you need to:

• Dene the start date and end date for each of your scal years starting from the earliest date placed in service
through at least one scal year beyond the current scal year.
• Dene at least one calendar for each scal year to break the scal year into multiple report periods, such as
months.

Note: Depreciation fails if the current scal year is the last scal year you set up.

Multiple Fiscal Years

You can set up multiple scal years and assign dierent scal years to your dierent corporate books to meet the
various reporting and tax requirements.

Tax Books
A corporate book and all its associated tax books can use the same scal year or a dierent scal year. In other words,
the calendar for a tax book can use the same scal year or a dierent scal year as the calendar for its associated
corporate book.

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

Considerations for Creating Calendars

Calendars break down your scal year into accounting periods. Dene your calendars with as many periods as
necessary for your reporting and tax regulation requirements. Each book you set up requires a depreciation calendar
and a prorate calendar. You can use one calendar for multiple depreciation books and as both the depreciation and
prorate calendar for a book.
Corporate books can share the same calendar. A tax book can have a dierent calendar than its associated corporate
book. The calendar for a tax book can use the same scal year or a dierent scal year as the calendar for its associated
corporate book.

Note: You must initially set up all calendar periods from the period corresponding to the oldest date placed in
service to the last day of the current scal year. You must set up at least one period before the current period.
At the end of each scal year, Oracle Fusion Assets automatically sets up the periods for the next scal year.

Dene calendars according to your needs. For example, to dene a 4-4-5 calendar, set up your scal years, depreciation
calendar, and prorate calendar with dierent start and end dates, and ll in the uneven periods. You can divide annual
depreciation proportionately according to the number of days in each period or evenly in each period.

Before you can set up a calendar, you must have completed seing up the following:
• System controls
• Fiscal years

Depreciation Calendar
The depreciation calendar determines the number of accounting periods in your scal year.
Note: If you assign the depreciation calendar to a book from which you create journal entries and transfer it
to your general ledger, you must set up your depreciation calendar with the same period names you set up in
your general ledger.

Prorate Calendar
The prorate calendar determines what rate Assets uses to calculate annual depreciation by mapping each date to a
prorate period, which corresponds to a set of rates in the rate table.
The Depreciation process uses the prorate calendar to determine the prorate period that's used to choose the
depreciation rate.

Create an Asset Calendar

This example shows how to create a monthly calendar in Oracle Fusion Assets.

Create an Asset Calendar

1. Navigate to the Manage Calendars page.

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

2. Click the Create icon.

3. On the Create Calendar page, complete the elds as shown in this table.

Field Value

MTH CAL
Name  

Monthly Calendar
Description  

FIS YR
Fiscal Year Name  

12
Periods per Year  

Calendar
Period Sux  

4. Click the Add Row icon.

5. In the Periods region, enter information for the rst period as shown in this table:

Field Value

JAN-12
Period Name  

1
Period Number  

1/1/12
Start Date  

1/31/12
End Date  

6. Click the Add Row icon to enter another period.

Note: The values for Period Number, Start Date, and End Date are entered automatically.
You only need to enter the rst three leer of the month in the Period Name eld: FEB.

7. Continue adding periods until you have entered all 12 periods.

8. Click Save and Close.
9. Click Done.

Prorate and Retirement Conventions

Oracle Fusion Assets uses prorate and retirement conventions to determine how much depreciation to take in the rst
and last year of an asset's life.

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

To determine depreciation, set up:

• Prorate conventions
• Retirement conventions

Prorate Conventions
Dene prorate conventions to determine depreciation in the rst and last year of an asset's life, based on when you
place the asset in service. Since assets can be acquired at any time in a given period, prorate conventions must account
for every date in the scal year for assets to depreciate properly. The prorate convention and the date placed in service
determine the prorate date. Assets uses the prorate date to determine the prorate period in your prorate calendar.
Note: You must initially set up all your prorate conventions from the convention period corresponding to the
oldest date placed in service through the end of the current scal year. At the end of each scal year, Assets
automatically sets up your prorate conventions for the next scal year.

Assets prorates the depreciation taken for an asset in its rst scal year of life according to the prorate date. For
example, if you use the half-year prorate convention, the prorate date of all assets using that convention is simply
the midpoint of your scal year. So assets acquired in the same scal year take the same amount (half a year's worth)
of depreciation in the rst year. If however, you use the following month prorate convention, the prorate date is the
beginning of the month following the month placed in service, so the amount of depreciation taken for assets acquired
in the same scal year varies according to the month they were placed in service.

Your reporting authority's depreciation regulations determine the amount of depreciation to take in the asset's rst
year of life. For example, some governments require that you prorate depreciation according to the number of months
you hold an asset in its rst scal year of life. In this case, your prorate convention has twelve rate periods, one for each
month of the year. Other reporting authorities require that you prorate depreciation according to the number of days
that you hold an asset in its rst year of life. This means that the scal year depreciation amount would vary depending
on the day you added the asset. Thus, your prorate convention contains 365 prorate periods, one for each day of the
year.

Retirement Conventions
If you do business in a country that requires you to use a dierent prorate convention for retirements than for additions,
set up retirement conventions to determine how much depreciation to take in the last year of life, based on the
retirement date.
If you retire the asset before it is fully reserved, then Assets uses the prorate date from the retirement convention to
determine how much depreciation to take in the asset's last year of life.

Overview of Capitalization Threshold Amounts

You can specify capitalization threshold amounts to automatically capitalize assets based on the dened capitalization
threshold. Optionally specify the low value threshold amount for each asset category so that these low value assets are
fully reserved using the specied method and life.

Threshold Types
Threshold types determine how the Prepare Asset Transaction Data process performs capitalization validation.

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

Threshold Type Description

Asset Cost Total cost of the asset or source line is compared with the capitalization threshold limit.
   
For example, in 2018 a company with a capitalization threshold of $5000 purchased seven
pieces of asset X at $4,400 each, for a total cost of $30,800. The company now wants to create
a single asset with seven units. Since the total cost of the asset ($30,800) is greater than the
threshold of $5000, the asset type will be Capitalized.
 

Unit Cost Per unit cost of the asset is compared with the capitalization threshold limit.
   
Using the previous example, since the per unit cost of the asset ($4,400) is less than the
threshold limit of $5000, the asset type will be Expensed.
 

Threshold Amounts
You can specify two types of threshold amounts.

• Capitalization Threshold

The Capitalization threshold species the minimum cost of an asset to be eligible for automatic capitalization. If
the asset cost is less than the capitalization threshold, the asset is automatically expensed.
• Low Value Threshold

The Low Value threshold species the maximum cost of an asset that is considered to be a low-value asset. A
low value asset is an asset that needs to be capitalized but it must also be fully depreciated either in the period
of acquisition or in the rst year of life.

Assets are capitalized using a Low Value Asset depreciation rule if the asset cost is equal to or more than the
capitalization threshold, but less than the low value threshold.

For example, if the Capitalization threshold is $3,000 and the Low Value threshold is $5,000:

• Asset cost is less than $3,000: Asset is Expensed

• Asset cost is between $3,000 and $4,999.99: Low value asset will be fully depreciated in the period of addition
• Asset cost is $5,000 or more: Asset is Capitalized

Enable Capitalization Thresholds

Before you can add capitalization thresholds, you need to update your setup so that capitalization threshold elds are
visible on the Advanced Rules tab on the Manage Books page.
To enable the Advanced Rules tab:

1. Go to Setup and Maintenance > Setup: Financials > Fixed Assets > Manage Fixed Assets Lookups.
2. Search for: Lookup Type: ORA_FA_ALLOW_CAP_THRESHOLD.
3. Click the Create icon in the Financials Generic Lookup Type: ORA_FA_ALLOW_CAP_THRESHOLD section.
4. Complete the elds as shown in this table:

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

Field Value

Lookup code Your book name

   

Reference Data Set Common Set

   

Display Sequence 1
   

Enabled Check the check box

   

Start Date Today's date

   

Meaning Your book name

   

Description A meaningful description

   

Set Capitalization and Low Value Thresholds

Go to Setup and Maintenance > Setup: Financials > Fixed Assets > Manage Asset Books > Advanced Rules tab.
1. Enter the capitalization threshold type:

◦Cost: When you select this value the total cost of the asset or source line is compared with the
capitalization threshold limit.
◦ Unit: When you select this value the per unit cost of the asset is compared with the capitalization
threshold limit.
2. Enter the capitalization threshold amount. The capitalization threshold amount is the lowest amount an asset
should cost to be capitalized. Assets with a cost that is less than this amount will be expensed.
3. Enter a low value threshold amount. Low value assets are assets that need to be capitalized, but must be fully
depreciated either in the period of acquisition or in the rst year of life. If the low value threshold isn't required
for your setup, enter the same amount for the capitalization threshold and the low value threshold.
4. Click Save.

Set Low Value Asset Depreciation Rules for Categories

You can also specify threshold amounts by category if you need dierent threshold amounts for dierent categories.

Note: If you specify threshold amounts by category, the category threshold amounts override the threshold
amounts dened for an asset book.

• Navigate to: Setup and Maintenance > Setup: Financials > Fixed Assets > Manage Asset Categories> Select a
category > Edit > Accounting Rules section > Default Rules tab.

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Oracle Financials Cloud Chapter 3
Implementing Assets Asset Books

• In the Low Value Asset section of the Edit Category page, enter the capitalization threshold amount, low value
threshold amount, depreciation method, life, and prorate convention.
• Click Save.

Validate Capitalization Threshold Results

If you use capitalization thresholds, you need to validate the thresholds after you add assets.
Here's how:

1. Add assets using the Mass Additions File-Based Data Import template or from Payables.
2. Navigate to Assets -> Additions Infotile -> Actions -> Prepare Additions Automatically.
3. Run the Prepare Asset Transaction Data process. This process determines whether to expense or capitalize
assets, based on the specied threshold values.
4. After the Prepare Asset Transaction Data process completes, view the validation results in the Edit Source Line
page.

Best Practices for Working with Threshold Validation Results

After you run the Prepare Asset Transaction Data process, check the validation results and make any necessary
updates.

• Note whether the Evaluation check box is enabled:

◦ Enabled: validation is complete

◦ Not enabled: no validation was done for that line

• You can continue to make changes to a source line after threshold validation, but the threshold validation can't
be done again.
• If the threshold validation process identies an asset addition line as low value asset, it automatically enables
the Low value asset check box in the Financial Details tab in the Edit Source Line page. The process also enters
the depreciation method and prorate convention specied for low value assets in the category default rules.

You can update the check box, depreciation method, and prorate convention, but the threshold validation can't
be done again for this line.
• If you perform a cost adjustment immediately after you add an asset, the cost of the asset may be greater than
or less than the capitalization threshold. Assets doesn't automatically change an asset to a low value asset
or low value asset to a non-low value asset. You decide whether to change it to a non-low value asset or to
continue to treat it as a low value asset.
• To change an asset to a non-low value asset, perform an adjustment transaction to disable the Low value check
box and change the depreciation method. This change is treated as a normal depreciation method change and
depreciation will be recalculated.
• For a tax book, the Mass Copy process evaluates the capitalization and low value thresholds. The process
copies the transaction from the corporate book to the tax book, regardless of whether the asset type is the
same in the corporate and tax books.

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Oracle Financials Cloud Chapter 4
Implementing Assets Depreciation Methods

4 Depreciation Methods

Depreciation Methods
Depreciation methods specify how to allocate the asset cost.
You can use:
• Oracle Fusion Assets predened depreciation methods.
• Company-dened depreciation methods you dene to accommodate your nancial and accounting needs.

Predened Depreciation Methods

Assets provides the following predened depreciation methods:
• Straight-Line
• 150 Declining Balance with Straight-Line Switch
• 200 Declining Balance with Straight-Line Switch
• ACRS: Low-Income Foreign
• ACRS: Personal Foreign
• ACRS: Real Foreign Mid-Month Convention
• ACRS: Low-Income
• ACRS: Low-Income Mid-Month Convention
• ACRS: Personal Straight-Line
• ACRS: Real
• ACRS: Real Mid-Month Convention
• ACRS: Real Straight-Line
• ACRS: Real Straight-Line Mid-Month Convention
• Alternative Minimum Tax: Half-Year Convention
• Alternative Minimum Tax: Mid-Quarter Convention
• MACRS: Half-Year Convention
• MACRS: Mid-Quarter Convention
• MACRS: Straight-Line Half-Year Convention
• MACRS: Straight-Line Mid-Month Convention
• MACRS: Straight-Line Mid-Quarter Convention
• Sum of Years Digits

Company-Dened Depreciation Methods

You may need to set up additional depreciation methods other than the predened methods Assets includes.
This may be required, for example, when you're using a depreciation method already that needs to be modied. You
can't modify a depreciation method that's in use, so you need to dene a new depreciation method.

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Oracle Financials Cloud Chapter 4
Implementing Assets Depreciation Methods

You can dene the following types of depreciation methods:

Depreciation Method Description

Calculated (straight-line) Calculates the annual depreciation rate by dividing the life (in years) into one. Calculated
  methods spread the asset value evenly over the life of the asset.
 

Table-based Calculates the annual depreciation using the depreciation method and life to determine which
  rate table to use. Then, it uses the prorate period and year of life to determine which of the
rates in the table to use.
 

Flat-rate Calculates the annual depreciation as the depreciation rate multiplied by the recoverable cost
  or net book value, multiplied by the fraction of a year the asset was held.
 

Formula-Based Depreciation Methods

Dene formula-based depreciation methods when the existing methods aren't adequate to handle your company's
depreciation requirements.
Assets provides predened variables and functions you use to create formula-based depreciation methods. Any
formulas you create are saved for later use.

Note: You must plan and thoroughly test your company-dened depreciation formulas to ensure that your
assets will depreciate correctly. Otherwise, company-dened depreciation formulas can cause unexpected and
incorrect depreciation rates.

Bonus Depreciation Rules

Use bonus rules to increase the annual depreciation expense for assets in the early years of an asset's life using the
following methods:
• Flat-rate
• Straight-line
• Table-based
• Formula-based

A bonus rule can use a dierent bonus rate for each year of the asset's life.

You can:

• Modify the rate at any time for current and future scal years.
• Use bonus rules with corporate books as well as tax books.
• Set up negative bonus rates to amortize bonus reserve.

Note: You can't remove the bonus rule from an asset. You can only change the bonus rule. If the asset isn't
required to take additional depreciation then you need to change the bonus rule to another rule with rate of
zero.

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Oracle Financials Cloud Chapter 4
Implementing Assets Depreciation Methods

Depreciable Basis Rules

Assets provides depreciable basis rules to accommodate depreciation method setup requirements that aren't met by
the cost or net book value calculation basis types. The combination of the depreciable basis rule and the depreciation
method determine how the depreciable basis is derived.

Set Up a Life in Periods Depreciation Method

This example demonstrates how to set up a depreciation method that depreciates assets based on the life in periods.

Set Up a Life in Periods Depreciation Method

1. Navigate to the Manage Depreciation Methods page.
2. Click the New icon.
3. On the Create Depreciation Method page, complete the elds, as shown in this table:

Field Value

LIP
Name  

Life in Periods
Description  

Enterprise Set
Reference Data Set  

Calculated
Method Type  

Selected
Life in periods radio buon  

24
Life in Periods  

4. Click Save and Close.

Use a Life in Periods Depreciation Method

Oracle Fusion Assets lets you to enter and maintain the life of assets by the number of asset calendar periods rather
than calendar years and months. The asset cost will be amortized equally over the calendar period life. You can also
depreciate subcomponent assets by periods.
When you perform an asset inquiry on the asset, the results show the asset life and remaining life in periods.

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Oracle Financials Cloud Chapter 4
Implementing Assets Depreciation Methods

Scenario
In this example:

• Has a scal year from January to December with 13 periods

• Acquired machinery for $7800.00
• The estimated useful life of the machinery is 39 periods
• The periodic depreciation is 7800/39 = $200

Note: The life in years and months will not be tracked for assets that use this method for depreciation.
Standard reports show the life in years and months with a decimal (for example, 12.00) and the life in periods
without a decimal (for example, 39).

26
Oracle Financials Cloud Chapter 5
Implementing Assets Asset Categories

5 Asset Categories

Overview of Asset Categories

Asset categories let you dene information that is common to a group of assets, such as the depreciation method and
the prorate convention.
General category information includes a description of the category, and default information such as whether assets in
this category are leased or owned, personal or real property, and whether they are capitalized. You can also specify if
assets by default are in physical inventory or are enabled in Oracle Fusion Assets.

Asset categories also contain:

• General Ledger accounts
• Default depreciation rules
• Tax book depreciation rules
• Default subcomponent depreciation rules
• Group asset depreciation rules

General Ledger Accounts

You assign General Ledger accounts to your category during category setup.
Assign the following General Ledger accounts when dening asset categories:
• Asset Cost account: Reconcile asset costs to your general ledger. Assets creates journal entries for this account
to reect additions, retirements, cost changes, transfers, reclassications, and capitalizations.
• Asset Clearing account: Reconcile your payables system and Assets for manual asset additions and cost
adjustments. For mass additions, Assets uses the complete account combination that comes over with a mass
addition line to reconcile the asset addition or cost adjustment with your payables system.
• Depreciation Expense account: Charge depreciation for assets in this category and book to this account.
• Accumulated Depreciation account: Use this account as the contra account for the asset cost account for this
category.
• Bonus Expense account: Use this account if you have set up bonus rates. If you do not enter a value in the
bonus expense account, it defaults to the depreciation expense account.
• Bonus Reserve account: Use this account to post bonus reserves. If you do not enter a value for the bonus
reserve account, it defaults to the accumulated depreciation account.
• CIP Cost account: Reconcile construction-in-process (CIP) asset costs to your general ledger.
• CIP Clearing account: Use this account if you entered a CIP cost account.
• Unplanned Depreciation Expense account: Charge unplanned depreciation for assets in this category and book
to this account.

Default Depreciation Rules

Set up default depreciation rules for each category in each book. The default depreciation rules that you set up for a
category also depend upon the date placed in service ranges you specify. Oracle Fusion Assets defaults the depreciation

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Oracle Financials Cloud Chapter 5
Implementing Assets Asset Categories

rules when you add an asset, to help you add assets quickly. If the default does not apply, you can override many of the
defaults for an individual asset.
Set up the following default depreciation rules when dening asset categories:
• Placed in service range: When you add an asset, the depreciation rules default according to the date placed in
service of the asset, the category, and the book. You can specify as many ranges of default depreciation rules
as you need. If you leave the end date blank, Assets uses that set of depreciation rules indenitely.
• Depreciate: The Depreciate check box species whether assets are normally depreciated in this book and
category.
Note: Expensed assets are not depreciated, even if the Depreciate check box is checked.

• Method: Species the default depreciation method for assets in this book and category:
◦ If you enter a life-based method, you must enter the asset life in years and months. The table-based
method you enter must have the same number of periods as the prorate calendar for this book.
◦ If you enter a at-rate method, you must enter default values for the basic rate and adjusted rate that
you normally use to depreciate assets in this book and category. If you are dening this category for a tax
book, you also can enter a bonus rule.
• Depreciation limit type: Species whether to depreciate an asset beyond the recoverable cost in the years
following the useful life of the asset.
• Bonus rule: Species the default bonus rule for assets in this book and category. You can use bonus rules for
corporate books and tax books, using all depreciation methods.
• Prorate convention and retirement convention: Species the default prorate and retirement conventions
assigned to assets in this book and category.
• Default salvage value: Species a default salvage value percentage for this category, book, and range of dates
placed in service. This rule is valid only if you chose to use the default percentage from the salvage value for
this book.
For example, if you want the salvage value to default to 10 percent of the cost, enter 10. When you perform
transactions aecting asset cost, Assets uses this default percentage to calculate the salvage value according to
the following formula:
Salvage Value = Cost * Default Percentage
For tax books, optionally enter either a depreciation expense or cost ceiling.
• Depreciation ceiling: Species the depreciation expense limit to be used for assets in this tax book and
category.
• Capital gains threshold: Species the minimum time you must hold an asset for Assets to report it as a capital
gain when you retire it.
• Mass property eligible: Species whether assets added to this category are eligible to be mass property assets.
A mass property asset contains multiple assets with the same category, book, and scal year combination.

Tax Book Depreciation Rules

The following depreciation rules are specic only to tax books:
• Straight line for retirements: Species that a straight-line depreciation method is used to determine the gain or
loss resulting from the retirement of 1250 (real) property.
• Method: Species the default depreciation method for assets in tax books.

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Oracle Financials Cloud Chapter 5
Implementing Assets Asset Categories

• Life: Species the default number of years and months for assets in tax books.

Default Subcomponent Depreciation Rules

The following depreciation rules are specic only to assets that are subcomponent assets of parent assets:
• Rule: Species the default life of the subcomponent asset based on the life of the parent asset.

◦ None (leave eld blank): There is no connection between the life of the subcomponent asset and the
parent asset. Assets defaults the subcomponent asset life from the asset category.
◦ Same end date (no minimum life specied): The subcomponent asset becomes fully depreciated on the
same day as the parent asset or at the end of the category default life, whichever is sooner. The default
subcomponent asset life is based on the end of the parent asset life and the category default life. If the
parent asset is fully reserved, Assets gives the subcomponent asset a default life of one month.
◦ Same end date (minimum life specied): The subcomponent asset becomes fully depreciated on the
same day as the parent asset, unless the parent asset life is shorter than the minimum life you specify.
The subcomponent asset's life is determined based on the end of the parent asset's life, the category
default life, and the minimum life. If the parent asset's remaining life and the category default life are
both less than the minimum life you enter, Assets uses the minimum life for the subcomponent asset.
Otherwise, it uses the lesser of the parent asset's remaining life and the category default life.
◦ Same life: The subcomponent asset uses the same life as the parent asset. It depreciates for the same
total number of periods. If the subcomponent asset is acquired after the parent asset, it depreciates
beyond the end date of the parent asset life.
• Minimum life (years and months): Species the minimum life of subcomponent asset when you choose same
end date for the subcomponent life rule. If the parent asset's remaining life and the category default life
are both less than the minimum life you enter, Assets uses the minimum life for the subcomponent asset.
Otherwise, it uses the lesser of the parent asset's remaining life and the category default life.

Group Asset Depreciation Rules

The following depreciation rules are specic only to group assets and their member assets:
• Recognize gain or loss: Species that gain and loss is not recognized at the time of the retirement. This option
applies only to member assets that are members of a group asset.
• Terminal gain or loss: Species whether to recognize terminal gain and loss immediately, at the end of the
year, or not at all. Terminal gain or loss occurs when the last member asset in a group asset is retired and no
additional assets will be added to the group asset. The remaining accumulate depreciation balance in the group
asset is the terminal gain or loss amount.
• Recapture excess reserve: Species whether the excess group asset accumulated depreciation should be
recaptured and recognized as a gain.
• Limit net proceeds to cost: Species that the amount of proceeds that may be added to accumulated
depreciation is limited to the recoverable cost of the retiring member asset. This rule is available only if you
specied that gain and loss is not recognized.
• Tracking Method

◦ Allocate group amount: Species whether to allocate the calculated group depreciation amount to its
member assets. The allocation is based on the depreciable basis of the member assets.
◦ Calculate member asset amount: Species if depreciation is calculated at the member asset level.

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Oracle Financials Cloud Chapter 5
Implementing Assets Asset Categories

• Group asset: Species the group asset to which all assets added to this category will be assigned. If you enter a
group asset number in this eld, all capitalized and construction-in-process (CIP) assets using this category will
be automatically assigned to the group asset entered.

Create an Asset Category

This example demonstrates how to create an asset category in Oracle Fusion Assets.

Before You Start

This worked example assumes that the following have been dened:

• Category exeld segment values

• Depreciation methods
• Prorate conventions
• Natural accounts

Create an Asset Category

1. Navigate to the Manage Asset Category page.
2. Click the Create icon.
3. On the Create Category page, complete the elds, as shown in this table:

Field Value

COMPUTER
Major Category  

PC
Minor Category  

PC
Description  

Non-lease
Category Type  

Owned
Ownership  

Personal
Property Type  

1245 property
Property Class  

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Oracle Financials Cloud Chapter 5
Implementing Assets Asset Categories

4. Check the following check boxes:

◦ Capitalized
◦ Enabled
◦ In physical inventory
5. In the Books region, click the Add Row icon.
6. Enter the following in the Book eld: INF USA CORP
7. On the Accounts tab, enter the following account information:

Account Value

101. 10. 15170. 000.000.000

Asset Cost  

101. 10. 15910. 000.000.000

Asset Clearing  

101. 10. 68170. 121.000.000

Depreciation Expense  

101. 10. 16170. 000.000.000

Depreciation Reserve  

101. 10. 68170. 121.000.000

Bonus Depreciation Expense  

101. 10. 16170. 000.000.000

Bonus Depreciation Reserve  

101. 10. 15400. 000.000.000

CIP Cost  

101. 10. 15930. 000.000.000

CIP Clearing  

101. 10. 68170. 121.000.000

Unplanned Depreciation Expense  

101. 10. 68170. 121.000.000

Impairment Expense  

101. 10. 68170. 121.000.000

Impairment Reserve  

8. On the Default Rules tab, click the Add Row icon and complete the elds, as shown in this table:

Field Value

STL
Method  

5
Life in Years  

0
Life in Months

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Field Value

IF CAL MTH
Prorate Convention  

IF CAL MTH
Retirement Convention  

10
Default Salvage Percent  

9. Click the Save buon.

10. Click the Done buon.

Create a Lease Category

In this example, you create a lease category in Oracle Fusion Assets.

Create a Lease Category

1. Navigate to the Create Category page.
2. On the Create Category page, enter these values:

Field Value

VEHICLE
Major Category  

LEASE
Minor Category  

Lease
Category Type  

Leased
Ownership  

3. In the Books section, click the Create icon.

4. Select your lease-enabled book. For example, OPS CORP.
5. Enter the Asset Cost, Depreciation Expense, and Depreciation Reserve accounts.
6. Enter all required lease default accounts:

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Oracle Financials Cloud Chapter 5
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Account Name Account Type Description

Lease Liability Only liability accounts are allowed. Initial lease liability, periodic interest
    on lease liability, and periodic lease
payments are charged to this account.
 

Lease Interest Expense Only expense accounts are allowed. For nance lease assets, the interest on
    lease liability is charged to this account.
 

Operating Lease Expense Only expense accounts are allowed. For operating lease assets, operating
    lease expense that is calculated to
allocate the cost of the lease over the
lease term is charged to this account.
 

Gain or Loss on Leased Asset Only expense and revenue type accounts Gain or loss arising from the termination
  are allowed. and scope change are charged to this
  account.
 

Lease Clearing Only asset accounts are allowed. Periodic lease payments that reduces the
    lease liability are credited to this account.
The credit is reversed when the lease
payment invoice is accounted in your
payables system. The excess of cost
over the lease liability in a leased asset
addition is also charged to this account.
For example, initial direct costs incurred
to negotiate or arrange a lease are not
included in lease liability, but they are
included in the leased asset's cost. When
you create invoices in Payables to make
lease-related payments that need to be
included in the leased asset cost but not
in the lease liability calculation, use this
account as the distribution account for
the invoices.
 

Lease Currency Rate Gain or Loss Only expense and revenue type accounts This account is required for asset books
  are allowed. with a reporting currency. Gain or loss
  on lease liability due to change in the
currency rate is charged to this account.
 

7. Enter the impairment and revaluation accounts if these transactions are enabled for this book.
8. Click the Default Rules tab to specify rules that are applied automatically when you create leases on the Manage
Leases page. Because payments such as variable lease payments and initial direct costs are normally not
included in lease liability and cost calculations, you must specify the lease payments to be excluded from lease
liability and cost calculation in these elds:
◦ Payment Types Excluded from Liability
◦ Payment Types Excluded from Cost

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Oracle Financials Cloud Chapter 6
Implementing Assets Optional Setup Steps

6 Optional Setup Steps

Dene Cash-Generating Units

This example demonstrates how to create a new cash-generating unit.

Dene a Cash-Generating Unit

1. Navigate to the Manage Cash Generating Units page.
2. Click the Add Row icon.
3. Complete the elds as shown in the following table:

Field Value

OPS CORP
Book  

Manufacturing CGU
Name  

Manufacturing Division Cash-Generating Unit

Description  

4. Click Save and Close.

Use a Cash-Generating Unit

The following example illustrates how to use cash-generating units for a mining enterprise.

Use a Cash-Generating Unit for a Mining Enterprise

A mining enterprise owns a private railway to support its mining activities. The private railway can be sold only for scrap
value and the private railway doesn't generate cash inows from continuing use that are largely independent of the
cash inows from the other assets of the mine.

Problem Solution Implementation

It isn't possible to estimate the recoverable The entity needs to estimate the Create a cash-generating unit
amount of the private railway because recoverable amount of the cash representing the entire mining enterprise
its value in use can't be determined, and generating unit to which the railway so that the impairment loss can be
provides service (the mine as a whole). calculated for the mine as a whole and

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Oracle Financials Cloud Chapter 6
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Problem Solution Implementation

probably is dierent from its value as   allocated to all assets in that cash-
scrap. generating unit.
   

Create a cash-generating unit representing the entire mining enterprise so that the impairment loss can be calculated
for the mine as a whole and allocated to all assets in that cash-generating unit.

Price Indexes
A price index is a normalized average (typically a weighted average) of prices for a given class of goods or services in a
given region, during a given interval of time. Price indexes help to compare how these prices, taken as a whole, dier
between time periods or geographical locations.
Oracle Fusion Assets uses the changes in price index values to revalue:
• The asset cost
• The net book value

A price index is associated to an asset through its asset category. By default, Assets uses the price index assigned to
the asset's category to calculate revaluation amounts, but you can override the default price index and recalculate the
revaluation amounts for an asset. Assets assigned to categories without a default price index should be excluded from
revaluation.

Create a Price Index

This example shows how to create a price index you use to calculate revaluation amounts.

Create a Price Index

1. Navigate to the Manage Asset Price Indexes page.
2. Click the Create icon.
3. Enter the information shown in this table:

Field Value

Machinery and Equipment Price Index

Name  

Machinery and Equipment Price Index

Description  

Monthly
Calendar Name  

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Oracle Financials Cloud Chapter 6
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4. Click the Add Row icon.

5. Enter the Fiscal Year 2013 and click Next.
6. Enter index values as shown in this table:

Period Name Value

Jan-13 132.149
   

Feb-13 133.237
   

Mar-13 133.586
   

Apr-13 133.444
   

May-13 133.660
   

Jun-13 133.930
   

Jul-13 133.947
   

Aug-13 134.120
   

Sep-13 134.261
   

Oct-13 133.902
   

Nov-13 133.601
   

Dec-13 133.546
   

7. Click Save and Close.

Assets Prole Options

Set prole options to specify how Oracle Fusion Assets controls access to and processes data, such as:
• The number of requests you can run in parallel
• The timing diagnostic message value
• The amount of database information retained in a concurrent process
• The cache reset value
• The batch size used for bulk processing in mass processes

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Oracle Financials Cloud Chapter 6
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• The book selected by default in Assets pages

Parallel Request Number

This prole option controls the number of requests you can run in parallel for Assets processes that can run in parallel.
For example, use this prole option to run parallel depreciation processes.

Prole Option Display Name Default Value Eect

Parallel Request Number 1 You can enter a number between 1 and

    20 to specify the maximum number of
parallel requests you want to allow. If you
set a value that is greater than 1, you can
run multiple processes at the same time.
For example, if you set the value to 5, you
can run multiple Depreciation processes.
 

Timing Diagnostics
You set whether timing diagnostic messages are printed in concurrent program log les. Support personnel can use this
prole option as a tool to identify problems with the code.

Prole Option Display Name Default Value Eect of Enabling Eect of Disabling

Timing Diagnostics No value (No) Enables printing of timing Disables printing of timing
    information information
   

Cache Sizing Factor

This prole option controls the amount of database information retained in concurrent process for performance
improvement.

Prole Option Display Name Default Value Eect

Cache Sizing Factor 25 You can set a value from 0 to 25. The
    number you enter controls the amount
of information that can be stored in the
cache. If you enter a value of 0, only one
record is retained in the cache. If you
enter a value of 25, a large amount of
data is retained in the cache. In general,
a small cache size works beer for a
very simple data structure. A large cache
size works well for a more complex data
structure, for example, setup data that
uses many depreciation methods, bonus
rules, depreciation ceilings, and retirement
conventions.
 

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Oracle Financials Cloud Chapter 6
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Depreciation Single
This prole option controls the caching buer used when you run the Depreciation process.

Prole Option Display Name Default Value Eect of Enabling Eect of Disabling

Depreciation Single No value (No) Cache is reset after every asset Cache is reset after every 20
      assets
Note: Set this prole  
to Yes only temporarily
if some assets
failed previously
when running the
Depreciation process.
In this case, rerun the
Depreciation process
for any set of 20 assets
that failed depreciation.
When this prole option
is set to Yes, the log le
provides information on
each asset so that you
can determine which
asset failed. When the
assets have depreciated
successfully, reset the
prole option to No.
Running depreciation
with the prole
option set to Yes can
slow performance
considerably.
 

Batch Size
This prole option sets the batch size for the Mass Transactions process.

Prole Option Display Name Default Value Eect

Batch Size 200 The value indicates the number of records

    in a batch. For example, if you use the
default value of 200, each batch contains
200 records. The value can be between 1
and 10,000.
 

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Oracle Financials Cloud Chapter 6
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Default Book
This prole option species the book that appears by default on Assets pages.

Prole Option Display Name Default Value Eect of Enabling Eect of Disabling

Default Book None The default book appears as You must select a book from
    the value in all Assets pages the menu in all Assets pages
where the Book eld appears. where the Book eld appears.
   

Related Topics
• Hierarchy in Prole Levels

FAQs for Assets Conguration

What's a cash-generating unit?

A cash-generating unit is the smallest identiable group of assets that generates cash inows from continuing use and
is largely independent of the cash inows from other assets or groups of assets.

Why can't I change a cash-generating unit's

assignments?
If an impairment transaction occurred for an asset in the current period, then the cash-generating unit assignment
cannot be changed in the current period unless you roll back the impairment.

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Oracle Financials Cloud Glossary
Implementing Assets

Glossary
depreciable basis
The amount used to calculate the annual depreciation for an asset, which is generally the cost minus the salvage value.

recoverable amount
The higher of the net selling price or the value in use of an asset or cash-generating unit.

value in use
The present value of the future cash flows expected to be derived from an asset or cash-generating unit.

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Oracle Financials Cloud Glossary
Implementing Assets

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