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Getting Started with Oracle EPBCS CapEx Input Forms

Establishing Global Assumptions

Capital Expense Planning is a driver-based planning tool. You can set drivers by establishing global assumptions for each asset class (for example, buildings or machinery) or for all tangible or intangible assets.

 

 

 

 

 

 

 

 

Assumptions you can set:

The useful life of assets
Depreciation methods
Depreciation conventions
Amortization methods
Insurance, repair, and maintenance expenses
Depreciation rates for declining balance methods
Cash flow incidence, which determines cash flow impacts and allocations for asset
purchases

Investments     Existing Assets   Intangibles

Depreciation Assumptions—For each asset, enter:

Useful Life (in Years)—Indicates the useful life (in years) of assets: the period during which an asset is expected to be usable for the purpose it was acquired and used for depreciation and amortization calculations.

Depreciation Convention—For new and existing assets only. ProRate Beginning Period, ProRate Actual Date, Mid Period.

Amortization Method—For intangibles only. Indicates the amortization method to use for assets. Only applicable for assets with a finite useful life. Finite (spreads the asset value evenly over the useful life of the asset), Indefinite-lived (no amortization). Only Straight Line method is supported.

Funding Assumptions—For each asset, enter:

Cash Flow Incidence —Determines the cash flow for capital purchases; the assumption by which the pattern of cash flow is defined. Selections are: Before 2 Months, Before 1 Month, Same Month, Next Month, After 2 Months, After 3 Months, After 4 Months, or Staggered. The selection made directly impacts the Cash Flow statement.

Cash Flow Staggered Periods —Determines the number of cash flow periods if the cash flow incidence is staggered.
Funding %—Percentage of the capital purchases funded by an external source.

Funding Incidence— Determines the funding for the capital purchases; the assumption by which the pattern of cash inflow is defined. Selections are: Before 2 Months, Before 1 Month, Same Month, Next Month, After 2 Months, After 3 Months, After 4 Months, or Staggered.

Funding Staggered Periods— Determines the number of funding periods if the Funding Incidence is staggered.

Other Expenses—Enter assumptions for other expenses such as the percentage of Repairs, Insurance, Maintenance, and Taxes.
To assign expense drivers to another plan year, select Assign % Drivers from

the Actions menu. This option allows you to copy drivers from one year to another, varying by a specified increase in percentage. For example, if insurance is 2% and you select Assign
%    Drivers
and increment by 2, then the insurance becomes 4%.
 

After defining or reviewing capital assumptions, add capital assets and enter asset details.

1.    If you've integrated Capital and Projects, you can select a project to see the planned asset value for the project.

2.    On the New Asset Detail page, hover over the upper right side of the page to activate the menu, and from the Actions menu, select Add New Asset.

1 Click the Funding horizontal tab to enter funding assumptions for your assets.

2 If you’ve entered assumption for cash flow, funding, depreciation/amortization, those values are filled in by default but you can override them at the asset level.

Click the Asset Related Expenses horizontal tab to enter other asset expenses.

If you’ve entered assumptions for asset related expenses, those values are filled in by default but you can override them at the asset level.

1 Click the Detailed Justification horizontal tab to enter a text-based description and justification for the new capital asset.

2 When you’re done adding assets, on the New Asset Detail page, hover over the upper right side of the page to activate the menu, and from the Actions menu, select Calculate Assets. You’ll see the new assets reflected in the graphs on the bottom of the page.

3 From the Actions menu, select Roll Up to sum the asset class data for use in Financials.

Transferring and Retiring Existing Assets

1.    Select the asset, and then hover to see the Actions menu, and then select Transfer Asset or Retire Asset.

2.    Enter transfer details for the asset such as the Transfer To entity, the date, and the justification. Or, enter retirement details such as the retirement date, whether it’s a sale or a write-off, the retiree costs, and the sale or write-off value.

3.    For the target entity, you must calculate the assets: Navigate to the target entity (in the Point of View bar), and from the Actions menu, select Calculate Asset.

1.    Manage expenses, amortization, and so on.

2.    Hover to see the Actions menu, and then select Calculate All and Roll Up. This aggregates data for Total Entity, Total Fixed Asset, and any custom dimensions that are enabled.

 

Adding and Managing New Intangibles

Manage assets using these options.

Impair Asset—When an asset is worthless on the market than the value listed on the Balance Sheet, you can impair it, which results in a write-down of the asset account to the stated market price. Only intangible assets can be impaired. Enter details about the asset to be impaired including the impair date and the fair market value, and the impairment option:
Expensed—The asset value will be expensed.

Capitalized—The asset value will be capitalized. If you select the capitalize option, the impairment value is posted to capital reserve.

Partially Capitalized—Part of the asset value will be capitalized. If you select Partially Capitalized, the impairment value is apportioned to the capital reserve, based on Capitalized %. Amortization is reduced from the month of impairment.

Retire Asset—When assets are retired, asset balances are terminated as of the retirement date, and losses or gains on sales or write-offs are calculated. Also, asset-related expenses are not calculated for a retired asset after the retirement date.

Transfer Asset—To ensure optimum use of assets, facilities managers and cost center managers can transfer fixed asset resources across departments. When planning transfers, ensure that users have access permissions to the source and destination entities.

 

 

 

 

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