By Jim Snelson June 2, 2026
If you are tracking a Work in Progress (WIP) asset that needs to be capitalised later, follow this guide to ensure your expenditures are tracked correctly without prematurely impacting your Profit and Loss (P&L) statement.
Phase 1: Setting Up the WIP Asset
Before capitalising your asset, you must ensure your existing WIP asset and cost codes are configured correctly to handle capital expenditures (CAPEX).
1. Update the WIP Asset Settings
- Open your existing WIP Asset record.
- Ensure the Depreciation Method is set to Revaluation.
- Note: This configuration restricts selection to CAPEX Cost Codes only and prevents purchase costs from showing up in your P&L.
2. Create a CAPEX Cost Code
- Create a new Cost Code specifically for this capital expenditure (if it doesn’t already exist)
- Important: Ensure you check the CAPEX box during setup.
- Tip: If you don’t already have one, you may want to create a new Parent Code named “Capital Expenditure” to keep your accounts organized.
3. Enter Payment Lines
- If you have already logged expenses to standard P&L accounts, you will need to move them -> Locate and delete your existing expense Payment transactions (which are currently hitting your P&L as expenses).
- (Re-)enter these lines as Asset Purchases directly within your WIP Asset record (Nav: Fixed Assets).
- Use the original purchase dates and account details, but make sure to select the new CAPEX Cost Code created in Step 2. This ensures they do not appear in your P&L.
Phase 2: Capitalising the Asset
When the asset is ready to be placed into service, you will need to “retire” the WIP record and transfer the value to a new, active asset record.
Step 1: Dispose of the WIP Asset
- Open the WIP Asset record and click Edit > Dispose/Retire Asset.
- In the Manage Asset Disposal form, enter the Disposal Date.
- Verify that the Disposal Value matches your expected balance (this should equal the sum total of all your purchase costs).
- Verify that the Disposal Gain is exactly zero. (If the Disposal Gain is not zero, double-check that your Disposal Date is on or after the dates of all your capital expense entries).
- Click Dispose/Retire Asset.
Step 2: Create the Placed-in-Service Asset
Now, create a NEW Asset record for the final, active asset using the following parameters:
| Field | Value to Enter |
| Acquisition Date | Use the exact Disposal Date from the WIP asset step above. |
| B/Fwd Opening Net Book Value | Enter the exact Disposal Value from the WIP asset step above. |
| Depreciation Method | Select Straight-line. |
