Fixed Asset Materiality Thresholds
Fixed Asset Materiality Thresholds let you set a minimum capitalization amount for fixed assets. This ensures that small or immaterial purchases (like keyboards or computer mice) are not capitalized unnecessarily, keeping your fixed asset schedule clear and accurate. Instead, low-value items can be posted directly to an expense account, while only significant purchases are recorded as assets.
To Set a Materiality Threshold:
Click your company logo in the lower-left corner.
Go to Organization Settings > Accounting.
In the Assets Minimum Threshold section:
Enter your desired Minimum Threshold Amount (for example, $500).
Select an Alternate Account to be used when an item falls below the threshold. Common choices include Supplies or Office Expenses.
Click Save changes.
Note: You can adjust this threshold over time as your business grows and your materiality levels change.
How It Works:
When you create a bill for a purchase below the threshold (e.g., $40 for a keyboard), Rillet will automatically redirect the posting from the fixed asset account to the designated alternate account. The amount is immediately expensed in the GL, and no depreciation schedule is created.
When you create a bill for a purchase above the threshold (e.g., $1,000 for a computer), the item is capitalized as a fixed asset. It is posted to the fixed asset account and a depreciation schedule is generated in the GL impact.
Example:
Bill for $40, categorized as Computers and Equipment:
Automatically posted to Office Expenses instead of Fixed Assets.
Expensed in full, no depreciation.
Bill for $1,000, categorized as Computers and Equipment:
Recorded as a Fixed Asset.
Depreciation schedule applied based on useful life settings.
See Also
To learn more about setting up and managing fixed assets in Rillet, review these articles:
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