Currently we map the depreciation of fixed assets to projects and are starting to capitalize projects also but the main reason for this discussion is to find out how other organizations deal with these costs in the model;

• Are they sent to Projects directly or via Fixed Assets?
• Are the costs removed from Projects completely i.e. treated simply as a Fixed Asset and sent to Towers/Application?
• Are they treated any other ways?

Hi Julie,

from working with a number of customers on this subject, the question really boils down to what accounting practices are in place, and allocate based on that.

I've seen some customers that say they only capitalise or recognise the capitalisation once the costs once the project has completed, and so although the CapEx goes to projects, anything in Fixed Assets goes straight to the Towers as they are now Run costs

However, other customers have said that some depreciation costs do need to go to the projects object, but then they also need adequate information in their Fixed assets register to allow that to happen.

Michael

Thanks Michael that's really helpful

Just to add another string to this - would you necessarily have a Fixed Asset object in the CapEx model to capital the capitalization of a Fixed Asset?

As you can tell this is my first dive in to the CapEx model

Hi Julie - Here at Sysco we want to see the CapEx related to projects (both fixed assets and labor), and depreciation that was not related to projects. It means creating some custom allocation lines, essentially carving the F/A object into CapEx/Non-CapEx, then finding a way to i.d. when an asset gets assigned to the project. Since the assets aren't always identified and purchased when a project is started, this means we have to work with our Project Management group to get this info and create the mapping.  

Hope this was helpful! 

This is great thanks John