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EAM: Inflation Adjustment Is Being Calculated Incorrectly (Doc ID 2586628.1)

Last updated on JULY 21, 2020

Applies to:

PeopleSoft Enterprise FIN Asset Management - Version 9.2 to 9.2 [Release 9]
Information in this document applies to any platform.

Symptoms

On :  9.2 version

ACTUAL BEHAVIOR  
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Asset Management is calculating inflation adjustment incorrectly when the Amortization Convention has been set to "Following Month" or "Following Year".  When the Convention has been set to "Following Month", the Prior Period Depreciation should equal the Current Depreciation (in relationship to following month) in the first Period in which the inflation adjustment is calculated.  However, Asset Management sets the Prior Period Depreciation to 0.000000.  Likewise, when the Convention has been set to "Following Year", Prior Period Depreciation should be equal to the Current Depreciation (in relationship to following year) in the first Period in which the inflation adjustment is calculated.  However, as with following month, Asset Management sets the Prior Period Depreciation to 0.000000.  Additionally, in the first Period in which the inflation adjustment is calculated, the Factor should represent the quotient of (Market Rate in next Fiscal Year, Period 001) / (Market Rate in Period / Fiscal Year of In Service Date). However, Asset Management is performing a different calculation in order to derive the Factor.

EXPECTED BEHAVIOR
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The expectation is that the inflation for the 1st period of depreciation should be based on the current period when the convention is following month or following year.

STEPS
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The issue can be reproduced at will with the following steps:
1. Set up environment for inflation.
2. Add Asset with convention of Following Month or Following Year in Basic ADD or Express Add.  
3. Run Depreciation Calculation.
4. Run Create Accounting Entries.
5. Run Close Depreciation.
6. Run Calculate Inflation



Changes

Cause

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In this Document
Symptoms
Changes
Cause
Solution
References


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