[Music] i'm laurence tyndall here at glidefast consulting and today i'm going to show you a useful feature in the hardware asset management application in servicenow called depreciation asset depreciation is the process followed by organizations to allocate the cost of an asset over the duration of its useful life this process is typically fulfilled by accounting and finance teams within a company asset depreciation is a critical process as it allows organizations to write off assets over multiple tax years versus a single year by having this flexibility companies are able to strategically plan and control their finances to calculate the depreciation of an asset you need the following information useful life this is the amount of years that an asset is typically useful for take for example a laptop they're usually useful for about five years most organizations will follow accounting guidelines that determine the useful life for assets based on their class total price this is the total amount the organization paid for the asset purchase date this is the date in which the asset was procured from the vendor depreciation method this is the formula that is used to calculate the depreciation of an asset over its useful life the next section of this lecture we'll talk about this in greater detail salvage value this is the amount that the asset will be worth when it's fully depreciated now you know what information you need to calculate the depreciation of an asset let's talk about the most common depreciation methods and how they are used in the calculation process in it asset management the most popular depreciation methods that organizations use are straight line sl and double declining balance ddb straight line is the most simple depreciation method as the cost of an asset is allocated equally over the useful life of an asset and then double declining balance is the depreciation method used for organizations that are calculating the depreciation amount for assets that lose most of their value in their first years take for example an iphone they typically depreciate around 30 in their first year of use so you may be wondering why they're different depreciation methods why can't everyone just use the same one so the reason why there's different depreciation methods is so organizations can use them depending on the asset type for example organizations will use the double declining balance method for assets that lose the most amount of value in their first years think of a car for example a brand new card appreciates the most in the first two years of its life whereas computers and other i.t assets typically depreciate consistently over their lifetime now that we've covered what depreciation is let's go into servicenow and take a look at how to configure a hardware asset so it can automatically be depreciated in the system now that we're in service now click onto the application navigator and type in hardware assets under the asset application click onto the hardware assets module click on the new button a new hardware asset form will now load in today's example i'm going to create an asset record and then we'll fill in the required fields in order to calculate the depreciation in the model field i'm going to select the dell inc poweredge t410 computer now select the category and right click on the form header and click save to create this asset record now that the asset has been saved click on the depreciation tab in this tab we have the following fields depreciation this field allows you to select the depreciation method that you wish to use in today's example i'm going to select the straight line five years method as computers typically have a useful life of five years depreciation effective date this is the date in which you want the depreciation to start on the asset usually this is the purchase date in this example i'm going to select january 1st 2022 salvage value this is the amount that the asset will be worth when it's fully depreciated i'm going to enter 50 dollars residual date this is the date in which the depreciation for this asset was last calculated residual value this is the remaining financial amount that the asset has left to depreciate then last but not least depreciated amount this is the amount that the asset has depreciated so far you'll notice that these three fields are read-only this is because the system automatically generates the values for these fields now right-click on the form header and save this record you'll notice that the system hasn't populated the residual date residual value and depreciated amount fields this is because the system has a scheduled job that runs once a day to calculate the depreciation amount for all assets this means that the values in these fields will only change once a day to manually update these values you can simply click on the calculate depreciation link that is located beneath the related links header as you can see the values in these three fields have now been updated you have successfully configured this asset to track its depreciation using the information you've learned from this tutorial you'll now be able to run reports on your hardware assets and provide stakeholders with asset depreciation figures and that is all for today's tutorial on asset depreciation and service now good luck and thanks for watching you