Procedure: Accounting for Divestment

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How to account for a divestment and adjust the depreciation fund?

To account for a divestment operation, make sure that the value of the Depreciation Fund in the last period of the historical analysis is equal to zero, as occurs if the data source is a statutory financial statements. In the event that a source is used in which fixed assets are indicated at gross value and the Depreciation Fund is valued, proceed as follows:

Access Balance Sheet Analysis / Balance Sheet / Numerical Analysis
At the last available annuity, open the adjustment column
Redistribute the residual value of the Depreciation Fund between Tangible and Intangible Fixed Assets and click on the Update button.

For example in case
- Tangible fixed assets: 1000
- Intangible fixed assets: 500
- Depreciation fund: - 150
= Net Fixed Assets: 1.350

the following corrections can be made (the user can obviously enter the exact values, if known):
- Tangible fixed assets: 1000 - 100 = 900
- Intangible fixed assets: 500 - 50 = 450
- Depreciation fund: -150 + 150 = 0
= Net Fixed Assets = 1.350

At this point in the Business Plan it will be possible to account for the divestment operation.

Example:

The company X Y Z srl sells an asset at its value NET present in the balance sheet equal to 400 (could correspond to an asset with a historical value of 900 and amortized for 5 years at the rate of 100 each year). The transaction takes place at the transfer price of 600.

To account for the transaction, you need to:
Access the Business Plan / Balance Sheet / Numerical Analysis and reduce Tangible Assets by Value (Historical Value net of the directly connected fund) 900 - 500 = 400i. This operation allows you to reset the net residual value of the asset.
Access the Business Plan / Income Statement / Numerical Analysis and enter in the Input the value of the Surplus realized equal to the difference between the Sale price and the amortized value of the Asset (600-400)
If the payment is not made by cash, increase the value of the Customer Credits by the corresponding amount

Check the result on the Cash Flow Statement. If the Customer Credits are not valued, the effect on the final cash will be positive for 400 + 200 - Taxes

Operation Not recommended but possible. If it is decided to adjust the depreciation fund, it is necessary to take into account that:

The change in the depreciation fund cannot exceed the change in tangible and intangible fixed assets.
The value of the depreciation fund post adjustment is also increased by the value of the depreciation present in the income statement

Therefore in the event that:

• Pre-adjustment Depreciation Fund Value: 50.000
• Depreciation for the same period: 1000
  The calculated value of the depreciation fund post adjustment would be equal to 51.000

In case of insertion of the value "0" as input of the Depreciation Fund, this would produce a reduction of the Depreciation Fund equal to 51.000 and not 50.000