You can use the business rules for fixed asset determination to identify purchases that qualify as fixed assets. If you have been assigned the applicable role, you can set up rules to determine whether a product must be treated as a fixed asset when the purchase price of the product exceeds a monetary threshold. The monetary threshold for a legal entity can differ from the monetary threshold for the organization.

The fixed asset rules are displayed when the following conditions are true:

 - An employee selects a product from a procurement category on a purchase requisition.

 - The unit price of the selected product equals or exceeds the threshold amount for the category.

Create qualifier questions to help classify a purchase of a fixed asset into the appropriate fixed asset group. You can create qualifiers for the organization that differ from the qualifiers at the legal entity level.

Prerequisites:

 - Set up an active procurement category hierarchy

 - Associate products that could potentially be classified as a fixed asset with a procurement category in the active procurement category hierarchy.

 - Set up fixed asset groups for legal entities.

 - A Currency conversation rate if the currency of a legal entity differs from the organization’s currency.

Example:

For this example, I am using the USMF legal entity from the Contoso database.

1. Go to Procurement and sourcing> Setup > Fixed assets > Organization-wide fixed asset identifiers. For this example, I am creating two identifiers one for Office (office equipment) for which the ‘OFFICE’ fixed group is assigned and one for Machine (Machinery) for which I have assigned ‘MACH’ as fixed asset group.

2. Next step, go to Procurement and Sourcing> Setup > Fixed assets > Business rules for fixed assets determination form. Here I will set up procurement categories that will be utilized to create a new fixed asset. 

As you can see in the image below, I have created a new business rule for office machines. Here I am selecting ‘Office Machines’ as the procurement category to determine fixed assets.

3. On the same form, In the organization-wide rule section I will create rules for the entire system. Here I am adding the capitalization threshold of USD $10,000 and an effective date of 04/01/2024 

At the bottom of the section, I have selected the previously created organization-wide fixed asset identifier ‘OFFICE’ as the default.

4. To prompt a user to determine if the asset will be part of the photocopier or machine fixed asset group. If the user selects the ‘Yes’ option, then the system will automatically enter ‘OFFICE’ in the fixed group on the purchase line and if the user selects the ‘No’ option then the system will automatically enter ‘MACH’ in the fixed asset group on the purchase line.

5. Let’s look at this configuration in action on the purchase line. Go to Procurement and Sourcing > Purchase orders. 

a. Create a new purchase order, here I am using the vendor account ‘US-111 - Contoso office supply.’

b. Add line to purchase line and select procurement category selected in ‘Business rules for fixed assets determination’, in this case, I am selecting ‘Office Machines’

c. Once I enter the amount for the ‘Office Machines’ (over the capitalization threshold of $10,000). The system has identified this as a fixed asset. Also, since I had set a qualifier, I must provide additional information,

6. Go to purchase line > Fixed asset tab and provide a qualifier answer from a drop-down

7. Depending on the qualifier selected, the system will enter a fixed asset group and enable the ‘New fixed asset’ checkbox.

OR

8. Once I select the appropriate qualifier, I can continue with my normal purchase order process.