Hi, I asked this a while back but I was wondering how do people handle credit memos against assets? The credit will reverse out the bill, but when you dispose of the Asset it debits A/D and Gain/Loss on disposal of Asset and Credits Asset Account. Since it's a credit memo we don't want anything to sit in G/L of Asset. Currently what I was trying is to is create a negative asset to reverse out what the asset is doing, but if depreciation occurs everything will reverse out except depreciation expense, which also throws off G/L on disposal of asset.

@Chris - how about revaluing your asset?

We aren't revaluing. basically we are just entering a negative asset to counteract asset whenever we get a credit memo. This method was provided by NS support and seemed to be the best way to deal with assets that had a credit memo against them

yes, you would have to do a manual journal to account for “leftovers” under these circumstance.

ah. So there is no other way for us to basically completely remove an asset that had a credit memo against it? It seems like an odd thing that credit memos against a fixed asset aren't processed in a way to remove the asset, but maybe there is an accounting reason for that.

if you start depreciating an asset and then after couple of month of use decide to return it (or whatever is the reason for the credit memo) the fact that the asset was used (i.e. depreciation expense was recorded) remains.

In the case where we issue credit memos it's that the product was likely defective so we want it to be treated as if it never was placed into service Example: 5 Laptops are put into service and depreciated for a quarter only to find out they are defective. We receive a full refund from the vendor. According to accounting in this situation they wouldn't want to keep depreciation expense on the books because this was a true "disposal" of an asset.

makes sense. A manual JE is definitely needed

ah ok. I was hoping to automate it somehow. Originally we were hoping credit memos against assets would get picked up by FAM and basically reverse it for us

well, you do not even get an asset out with disposal, it stays there forever 🙂. there is really no way i NetSuite to get anything out of the system, there is always a trail, and for a good reason

Well I mean i don't mind it being there disposed, but I wish there was an easier way to get rid of it due to credit memos instead of putting the balance into a gain or loss account. Maybe it would better better to just change the status and do a manual je to remove it

I understand 🙂. you can make a journal and then inactivate the asset..