The German language version of this blog post focuses on the question whether Dynamics AX is able to generate a fixed asset statement report that is in line with the German commercial code respectively the fixed asset statement report of the local German standard setter “DATEV”. Due to its country-specific nature, the German language version of this blog post might not be interesting for Dynamics AX users in other countries. For that reason, I decided to use a more generalized approach in this English language version by focusing on the major issues of the fixed asset statement report(s) available in the fixed asset module. Note that I use the term “reports” because Dynamics AX ships with several different country-specific fixed asset statement reports. As a result, not all issues that I mention in the following might be applicable in the country your company operates. Irrespective of this limitation and the different country-specific report versions, I hope that you might get the one or the other useful information out of this post that can be used in your Dynamics AX system.
(Please note that this blog post will be split into three separate blog posts for reasons of readability and due to its length).
Weaknesses of the standard Dynamics AX fixed asset statement report
The (German) standard Dynamics AX fixed asset statement report ships with the following weaknesses (issues):
- Issue 1:
Newly created fixed assets are not automatically included in the fixed asset statement report but rather need to be assigned manually in the fixed asset statement row setup window as this setup window does not allow using wildcards.
- Issue 2:
The fixed asset statement report columns and the fixed asset transaction types are linked via program code and cannot be modified by users as required.
- Issue 3:
Fixed asset statement rows can only be setup in one format. Different row formats that are required for the representation of different accounting standards (local GAAP, IFRS, US-GAAP, etc.) are currently not supported.
- Issue 4:
The standard Dynamics AX fixed asset statement report does not provide drill-down functionalities that are necessary for a detailed analysis and reconciliation of the fixed asset statement data.
- Issue 5:
Prepayments made for fixed assets, financial assets – such as long-term investments – and alike are often not recorded in the fixed asset module but rather tracked in General Ledger. As many local standard setters and governments require that those assets are included in the fixed asset statement report, subsequent changes/adjustments are needed.
The following chapters provide you numerous examples that answer the question how the different issues of the fixed asset statement report mentioned above can be solved. Please note that for reasons of simplicity and illustration, the examples used below refer to a single fixed asset group (“PKW”), a single value model (“HGB”) and a single fiscal year. Yet, the proposed solution can easily be extended to several fixed asset groups, value models and fiscal years.
The proposed solution for overcoming the issues of the standard Dynamics AX fixed asset statement report consists of setting up the fixed asset statement report in the Management Reporter. To realize this, the following setup steps are required.
Step 1: Setup fixed asset posting profile
The first setup step required is setting up the fixed asset posting profile in a way that ensures that each combination consisting of (a) a fixed asset transaction type, (b) a fixed asset group and (c) a value model is setup with a separate ledger account. Please note that the setup of the fixed asset disposal transactions (sale, scrap) also need to follow this principle as the Management Reporter cannot directly access the various fixed asset transaction types that are required for setting up a fixed asset statement.
Note: For additional details on the ledger account setup, please have a look at the fixed asset posting profile setup that is illustrated in the appendix.
Step 2: Setup financial dimensions and account structures
The next setup step required comprises (a) the setup of the automatic financial dimensions for fixed assets and fixed asset groups and (b) the corresponding setup of the account structures in the General Ledger module. Please see the next screenshot for an example.
As this second step is required for the subsequent setup of the fixed asset statement rows in the Management Reporter, the General Ledger account structures for the balance sheet accounts and income statement accounts need to be modified as exemplified in the previous screenshot.
Step 3: Automatic setup of fixed asset / fixed asse Group financial dimensions
To ensure that all fixed assets are automatically setup with their fixed asset group & fixed asset financial dimension values, a small code modification is required, which is illustrated in the next two screenshots for the AssetBook table. This code modification consists of (a) the creation of a new method (“SetFDFA”) and (b) the adjustment of the table’s insert method. Please note that this code modification is required for the AssetBook table and the Asset table.
After the code modification is implemented and a new fixed asset is setup, the automatically defaulting fixed asset group and fixed asset financial dimension values can be identified in the value model window of the newly created fixed asset.
Note: Due to automatic fixed asset transactions that do not allow a direct user interference, such as fixed asset reclassifications, the code modification illustrated is inevitable if you want to setup the fixed asset statement in the Management Reporter.
Step 4: Code adjustment for reclassification of fixed assets
In addition to the code modification shown in the previous step, a second code modification is required that handles the reclassification process of fixed assets. The fixed asset reclassification process is typically used when the construction of a fixed asset – such as a production hall, machine, etc. – is finished and all costs that were allocated to the “construction in progress fixed asset” are transferred to a newly created fixed asset. The next screenshots illustrate the problem of asset reclassifications and show you why a code modification is needed.
Example: For a fixed asset under construction “FA0003”, total costs of 10000 EUR and 500 EUR depreciation costs were accrued. After the construction of the fixed asset is finished, it is reclassified into a new fixed asset “FA0004” via the periodic reclassification functionality.
Please note that users cannot influence the newly created fixed asset (“FA0004”) that is setup, as Dynamics AX creates this fixed asset automatically. This can be identified by the grey-highlighted cell in the previous screenshot.
Without a system modification, Dynamics AX creates the following voucher for the old and new fixed asset.
What you can identify from this voucher is that all transactions are recorded with the fixed asset financial dimension of the old fixed asset („FA0003“). As this standard Dynamics AX behavior prevents the setup of a fixed asset statement report in the Management Reporter a system modification is required.
Solution: The problem illustrated can be fixed by adding the following code line in the AssetReclassification class.
With this code modification, the fixed asset transaction of the old fixed asset is recorded with the old financial dimension value and the new fixed asset transaction is recorded with the new fixed asset dimension value. The following screenshot shows this change in system behavior for the reclassification of an old fixed asset (“FA0005”) into a new fixed asset (“FA0006”).
Step 5: Setup of fixed asset journals for fixed asset reclassification and fixed asset splits
Dynamics AX does not have separate fixed asset transaction types for recording fixed asset reclassifications and fixed asset splits. If you want to report on those transactions separately in the fixed asset statement report you thus have to setup separate fixed asset posting journals in General Ledger. The number sequence used for those journals can then be used for identifying fixed asset reclassifications and fixed asset splits in the Management Reporter. For details, please see the examples in the next blog post.