HP Storage Essentials NAS Manager Software - Manual (Page 671)

Storage Essentials 5.1 User Guide 639
2. It determines the period ending date. This is equivalent to the last day of the previous full month.
Example: Assume today's date is January 9, 2004. The management server sets the period
ending to December 31, 2003.
3. The management server calculates the delta between purchase date and the period ending. This
determines how many months worth of depreciation amount the management server need to
take into account.
Example: Using the examples from the previous two steps, the delta is 12 months (January 1,
2003 - December 31, 2003).
4. The management server takes the user-specified depreciation period and use it as the life of the
asset.
Example: Let's assume the depreciation period is 24 months and that it is also the life of the
asset.
5. The management server calculates the declining ratio using this formula: (1.0 / life)*2. This
determines the rate at which depreciation should occur each month.
Example: Use the example from step 4 (24 months) and use it in the following formula to find the
rate of depreciate per month:
(1.0/24)*2
The depreciation ratio is 0.084.
6. For each month identified by delta from Step 3, the management server calculates the following:
The example for the following steps can be found at the end of these instructions.
a. Determine the “would-be” depreciation for the month. This means multiplying the asset value
for the month by the declining ratio from step 5.
b. Subtract the depreciation for the month from the asset value for the month. If the result is less
than the salvage value, it means the asset value after depreciation would be less than the
salvage. In this case, the management server simply depreciate the asset to the salvage
value. Once the management server depreciates an asset down to its salvage value, the
depreciation for that asset stops.
c. If the management server subtracts the depreciation for the month from the asset value and
the result is greater than the salvage value, then the management server know it is safe to
depreciate the asset by the depreciation amount calculated in step a. The depreciated asset
value for the month would be asset value minus depreciation. The new asset value will be
used to compute the depreciation for next month. This process continues until one of the
following occurs:
• The management server has depreciated the asset value for the number of months equal
to delta.
• The asset value has depreciated down to the salvage cost. If no salvage cost is specified,
then the asset value has depreciated down to 0.
Example: For Step 6, let's complete Steps a through c for the first month and then repeat these steps
for the second month.
Step 6a - Let's assume the asset value of the element is $2500. Calculate the "would-be"
depreciation of the month by multiplying the asset value by the declining ratio from Step 5 (0.084):
$2500 x 0.084 = $210