Re: [GNC] An automated depreciation calculator would be really helpful.

[Stephen M. Butler]

Per https://www.excel-easy.com/examples/depreciation.html Excel has five 
(5) depreciation methods.


I suspect these could be implemented in a manner similar to the loan 
calculations inside the transaction scheduler (I am not talking about 
the loan wizard but about the resulting functions ipmt, ppmt, etc).


Per https://wiki.gnucash.org/wiki/Scheduled_Transactions

   "Any text string /followed by parens/, optionally with arguments,
   will have the string "gnc:" prepended to it and *evaluated in the
   scheme environment*.

   *Arguments* are separated with |:|. See fin.scm
   

   for examples of providing functions."

So, new functions could be added to fin.scm (located at libgnu 
cash/app-utils/fin.scm) to support depreciation.  Perhaps implement the 
five (5) functions found in Excel.
If needed, there appears to be supporting C code in 
ibgnucash/app-utils/calculation/fin.c


This wouldn't automate it to the level the OP wishes, but a few minutes 
setting up scheduled transactions using the new routines would provide 
the rudimentary items needed to implement whichever depreciation 
schedule desired.


I also noted that there is a local/private function in fin.scm for 
rounding.  For the individual who wanted to force rounding at a 
particular point (discussion over a year ago) within a scheduled 
transaction, all they need to do is expose (make public) that function.


Someone other than the current developers with Scheme/C expertise should 
be able to whip those changes together and make a contribution.  I can 
read the source but do not have sufficient exposure to either language 
to craft the new functions.


--Steve


On 12/8/21 19:18, davidcousen...@gmail.com wrote:

Dave,

Depreciation rules are generally set by your taxation system and your accountant
will likely be reflecting those rules that apply in your jurisdiction. If you
are going to do the depreciation calculations then you will need to become
acquainted with the rules in your jurisdiction. Rules may also be different for
particular capital items and asset classes. If your taxation authority is nice
they will have published the rules on line. From the little I have read
depreciation is not an allowable business expense for tax purposes in the UK -
check that with your accountant though.

I personally used to maintain a spreadsheet for each major capital item I was
depreciating and similarly for items which could be pooled under the
depreciation rules and perform all the necessary calculations in the spreadsheet
and just record the resulting figures as required in my accounting program (not
GnuCash in the days when I was still running a business).

I suspect depreciation rules vary considerably in detail from jurisdiction to
jurisdiction making it difficult to define a general calculator which will work
adequately across all jurisdictions. It is a bit like loan repayment
calculations, they will likely come out pretty close but the methodology has to
be exactly the same to get the same result.

It should be possible to use the transaction file association to link the
transactions to a depreciation spreadsheet data file, which since most OS's can
initiate a program based on the file extension should allow the spreadsheet
program to be launched from the file association - haven't tested this out for a
spreadsheet but it does work for pdfs on Linux.

David Cousens


On Thu, 2021-12-09 at 00:34 +, Dr. David Kirkby wrote:

A friend of mine bought some Excel spreadsheets for his company accounts.
He has used them for many years and finds them good. He has suggested I use
them, but I'm not keen on that idea. At any point in time he can see
exactly what the depreciation of an item is, and so exactly when the value
has fallen to zero.

I read about depreciation in GnuCash at

https://cvs.gnucash.org/docs/C/gnucash-guide/chapter_dep.html

but it seems rather limited. The last paragraph on this page

https://cvs.gnucash.org/docs/C/gnucash-guide/dep_accounts1.html

says

"The actual input of the depreciation amounts is done by hand every
accounting period. There is no way in *GnuCash* (as of yet) to perform the
depreciation scheme calculations automatically, or to input the values
automatically into the appropriate accounts. However, since an accounting
period is typically one year, this really is not much work to do by hand."

I don't think it's true to say it's not much work to do. I know my
accountant says one should start depreciating from the day something goes
into service, but he uses a different scheme, which is good enough. If an
item is purchased before the halfway through the month, he considers it
purchased on the 1st of that month, and if after 50% of the way though the
month, he considers it purchased the following next month. The errors in
this should be small.

So each time an asset is purchased, one needs to start depreciating it from

Re: [GNC] An automated depreciation calculator would be really helpful.

[Michael or Penny Novack]

On 12/8/2021 7:50 PM, Gyle McCollam wrote:

What I do is set up a placeholder account for the asset.  I set up sub accounts 
for the actual asset purchase and another for the depreciation of the asset.  
You could then set up a scheduled transaction to record the depreciation each 
month, quarter, semiannually, or annually depending on how you want to record 
it.  There you can set up how many depreciation transactions you would like and 
it will stop at that point.


Book value vs real value

a) A business subject to taxation USUALLY depreciates fixed assets as 
rapidly as possible. Non-profits(in the US at least) are allowed great 
freedom in the time period they use. It is not related to what the 
actual residual value of the asset might be.


b) Usually (in the US) it is year or fraction of year. Usually doing 
"depreciation" is part of end of year (calendar or fiscal) processing 
and not monthly, etc.


c) Yes, for each fixed asset usual to have a sub-account for "basis" 
(what it cost) and a sub-account for all the depreciation charges.  But 
if the org had a lot of fixed assets bought each yes, I'd probably do 
"by year" with accounts for "bought in year" and "depreciation" and only 
work with the totals.


Michael D Novack

PS -- About "director loans" --- WHY are you going through the "business 
features" for these? They are NOT receivables or payables but only exist 
if and when received or paid out. Or at least I believe that to be the 
case. I am NOT "qualified" to give business law advice about that and 
certainly not for your jurisdiction.


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Re: [GNC] An automated depreciation calculator would be really helpful.

[davidcousens49]

Dave,

Depreciation rules are generally set by your taxation system and your accountant
will likely be reflecting those rules that apply in your jurisdiction. If you
are going to do the depreciation calculations then you will need to become
acquainted with the rules in your jurisdiction. Rules may also be different for
particular capital items and asset classes. If your taxation authority is nice
they will have published the rules on line. From the little I have read
depreciation is not an allowable business expense for tax purposes in the UK -
check that with your accountant though.

I personally used to maintain a spreadsheet for each major capital item I was
depreciating and similarly for items which could be pooled under the
depreciation rules and perform all the necessary calculations in the spreadsheet
and just record the resulting figures as required in my accounting program (not
GnuCash in the days when I was still running a business). 

I suspect depreciation rules vary considerably in detail from jurisdiction to
jurisdiction making it difficult to define a general calculator which will work
adequately across all jurisdictions. It is a bit like loan repayment
calculations, they will likely come out pretty close but the methodology has to
be exactly the same to get the same result.

It should be possible to use the transaction file association to link the
transactions to a depreciation spreadsheet data file, which since most OS's can
initiate a program based on the file extension should allow the spreadsheet
program to be launched from the file association - haven't tested this out for a
spreadsheet but it does work for pdfs on Linux.

David Cousens


On Thu, 2021-12-09 at 00:34 +, Dr. David Kirkby wrote:
> A friend of mine bought some Excel spreadsheets for his company accounts.
> He has used them for many years and finds them good. He has suggested I use
> them, but I'm not keen on that idea. At any point in time he can see
> exactly what the depreciation of an item is, and so exactly when the value
> has fallen to zero.
> 
> I read about depreciation in GnuCash at
> 
> https://cvs.gnucash.org/docs/C/gnucash-guide/chapter_dep.html
> 
> but it seems rather limited. The last paragraph on this page
> 
> https://cvs.gnucash.org/docs/C/gnucash-guide/dep_accounts1.html
> 
> says
> 
> "The actual input of the depreciation amounts is done by hand every
> accounting period. There is no way in *GnuCash* (as of yet) to perform the
> depreciation scheme calculations automatically, or to input the values
> automatically into the appropriate accounts. However, since an accounting
> period is typically one year, this really is not much work to do by hand."
> 
> I don't think it's true to say it's not much work to do. I know my
> accountant says one should start depreciating from the day something goes
> into service, but he uses a different scheme, which is good enough. If an
> item is purchased before the halfway through the month, he considers it
> purchased on the 1st of that month, and if after 50% of the way though the
> month, he considers it purchased the following next month. The errors in
> this should be small.
> 
> So each time an asset is purchased, one needs to start depreciating it from
> then. It's not true to say this is just done once per year.
> 
> Of course, I'm well aware that many people will have suggestions on how to
> improve the software, and the developer's time is limited. But some
> automated way of depreciating items would be very useful. As they say, if
> you don't ask you will not get, so there's no harm in asking!
> 
> Dave
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Re: [GNC] An automated depreciation calculator would be really helpful.

[Dr. David Kirkby]

On Thu, 9 Dec 2021 at 00:47, David Carlson 
wrote:

> That would be nice, but, as you opened the discussion with the note that
> you use spreadsheets to perform the calculations,
>

No I did not. I said a friend uses a spreadsheet for depreciation, after
purchasing some accounting add-on for Excel.

I have in the past just given my accountant the date of purchase, and what
the asset is. He works out the depreciation, but I have a rough idea how he
does it. It's the first method mentioned here

https://cvs.gnucash.org/docs/C/gnucash-guide/dep_value1.html

I would assume that if the calculator was added, that could do a linear
method, it would not take too much effort to use a different algorithm
There are examples of three methods at

https://cvs.gnucash.org/docs/C/gnucash-guide/dep_value1.html

The most difficult task would be getting it to use to do the work - once
set up, I doubt that a radio button or an entry in preference that just
does a different bit of mathematics would be too hard.

Unfortunately, I don't have the time to do this, and as I stated, I'm well
aware it's much easier to thing of ways of improving software, than to
actually do it on an open-source project, where people have other jobs.

Dave
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Re: [GNC] An automated depreciation calculator would be really helpful.

[Gyle McCollam]

What I do is set up a placeholder account for the asset.  I set up sub accounts 
for the actual asset purchase and another for the depreciation of the asset.  
You could then set up a scheduled transaction to record the depreciation each 
month, quarter, semiannually, or annually depending on how you want to record 
it.  There you can set up how many depreciation transactions you would like and 
it will stop at that point.


Thank You,
Gyle McCollam

Gyle McCollam

609.680.2326 Mobile

gmccol...@live.com   email


From: gnucash-user  on 
behalf of Dr. David Kirkby 
Sent: Wednesday, December 8, 2021 7:34 PM
To: GNU Cash User 
Subject: [GNC] An automated depreciation calculator would be really helpful.

A friend of mine bought some Excel spreadsheets for his company accounts.
He has used them for many years and finds them good. He has suggested I use
them, but I'm not keen on that idea. At any point in time he can see
exactly what the depreciation of an item is, and so exactly when the value
has fallen to zero.

I read about depreciation in GnuCash at

https://cvs.gnucash.org/docs/C/gnucash-guide/chapter_dep.html

but it seems rather limited. The last paragraph on this page

https://cvs.gnucash.org/docs/C/gnucash-guide/dep_accounts1.html

says

"The actual input of the depreciation amounts is done by hand every
accounting period. There is no way in *GnuCash* (as of yet) to perform the
depreciation scheme calculations automatically, or to input the values
automatically into the appropriate accounts. However, since an accounting
period is typically one year, this really is not much work to do by hand."

I don't think it's true to say it's not much work to do. I know my
accountant says one should start depreciating from the day something goes
into service, but he uses a different scheme, which is good enough. If an
item is purchased before the halfway through the month, he considers it
purchased on the 1st of that month, and if after 50% of the way though the
month, he considers it purchased the following next month. The errors in
this should be small.

So each time an asset is purchased, one needs to start depreciating it from
then. It's not true to say this is just done once per year.

Of course, I'm well aware that many people will have suggestions on how to
improve the software, and the developer's time is limited. But some
automated way of depreciating items would be very useful. As they say, if
you don't ask you will not get, so there's no harm in asking!

Dave
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Re: [GNC] An automated depreciation calculator would be really helpful.

[David Carlson]

That would be nice, but, as you opened the discussion with the note that
you use spreadsheets to perform the calculations, you realize that
different political jurisdictions have different accounting standards, and
to build code in GnuCash to accommodate all the possibilities and keep it
up to date would be even worse than trying to keep the tax report up to
date for the United States Federal Taxes, which AFAIK is done by one
devoted individual because he makes it his mission.

I do try to track depreciation for two automobiles but I calculate the
numbers in a spreadsheet and manually enter annual transactions as that is
sufficient for my intellectual curiosity.

If you want to make that your mission the developers would be able to help
you with the mechanics of writing the code if you can do the calculations.

On Wed, Dec 8, 2021 at 6:35 PM Dr. David Kirkby <
drkir...@kirkbymicrowave.co.uk> wrote:

> A friend of mine bought some Excel spreadsheets for his company accounts.
> He has used them for many years and finds them good. He has suggested I use
> them, but I'm not keen on that idea. At any point in time he can see
> exactly what the depreciation of an item is, and so exactly when the value
> has fallen to zero.
>
> I read about depreciation in GnuCash at
>
> https://cvs.gnucash.org/docs/C/gnucash-guide/chapter_dep.html
>
> but it seems rather limited. The last paragraph on this page
>
> https://cvs.gnucash.org/docs/C/gnucash-guide/dep_accounts1.html
>
> says
>
> "The actual input of the depreciation amounts is done by hand every
> accounting period. There is no way in *GnuCash* (as of yet) to perform the
> depreciation scheme calculations automatically, or to input the values
> automatically into the appropriate accounts. However, since an accounting
> period is typically one year, this really is not much work to do by hand."
>
> I don't think it's true to say it's not much work to do. I know my
> accountant says one should start depreciating from the day something goes
> into service, but he uses a different scheme, which is good enough. If an
> item is purchased before the halfway through the month, he considers it
> purchased on the 1st of that month, and if after 50% of the way though the
> month, he considers it purchased the following next month. The errors in
> this should be small.
>
> So each time an asset is purchased, one needs to start depreciating it from
> then. It's not true to say this is just done once per year.
>
> Of course, I'm well aware that many people will have suggestions on how to
> improve the software, and the developer's time is limited. But some
> automated way of depreciating items would be very useful. As they say, if
> you don't ask you will not get, so there's no harm in asking!
>
> Dave
> ___
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-- 
David Carlson
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Re: [GNC] An automated depreciation calculator would be really helpful.

[Liz]

On Thu, 9 Dec 2021 00:34:04 +
"Dr. David Kirkby"  wrote:

> So each time an asset is purchased, one needs to start depreciating
> it from then. It's not true to say this is just done once per year.

My scheme is to do all the calculations shortly after purchase, until I
get to zero. I'm not sure whether this is the same as my accountant's
calculations.
So I enter all the transactions, each for a different year and I never
have to look up again whether it was a 5% or a 30% or a 100%
depreciation schedule.

I can see an advantage to a calculation scheme in software to do
it for me.

Liz
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