Hi Cecilia Esi,
You are both correct. The gross method does not work as it should in the standard system. It does not carry out the "without write back" method" correctly. In fact it is currently working the same way the Net method (with write back) is working.
The Transaction Type Groups 80, 81, 82, 83 do not offer "without write back" functionality.
I have a client who are not happy with this because as far as they're concerned, the write back is incorrect as all previous depreciation up to the date of the revaluation, has already been expensed. And I agree with them on this point according to Internation Accounting Standards, fair value.
The Australian Solution, program YAAURV01 looks promising in that it will carry out depreciation without write back according to Australian Accounting Standards and International Accounting Standards:
The Australian Solution states in part:
As an alternative, the Australian Accounting Standards and the International Accounting Standards also allow what is generally known as the "Proportionate Method" (or "Gross Method") to be used for Asset Revaluations. This requires both the asset account and the accumulated depreciation account to be revalued, without any depreciation write-back. For the same asset with cost of $100,000, accumulated depreciation of $30,000 and a required 10% revaluation on NBV, this method would post as per below:
Posting Example:
Revalue Depreciation (PY & CY)
CR Accumulated Depreciation 3000
DR Asset Revaluation Offset account 3000
Revalue Asset (PY & CY)
DR Assets – Buildings 10,000
CR Asset Revaluation Offset account 10,000
The net effect of the Gross revaluation is to increase the NBV of the asset by $7000 or 10% on NBV.
Thanks
Kind regards
Justin