About CIP assets—Fixed Assets Management
Construction in Progress (CIP) allows you to manage long‑term capital assets, such as buildings, infrastructure, or custom equipment, while they’re still being built or assembled.
Fixed Assets Management supports the full CIP lifecycle, from initial acquisition through capitalization. AP purchase invoices and purchasing transaction lines coded to CIP GL accounts can automatically create CIP assets or add costs to existing ones. All costs are tracked on the asset’s CIP tab, giving you insight into project spend and progress.
When construction is complete, capitalize the asset to transfer accumulated costs from the CIP GL account to the Asset GL account. Then, you can place the asset in service to begin depreciation.
CIP asset states
CIP assets start in the Construction in progress state, where you can continue adding costs over time. After capitalizing, the asset moves to the Ready for review state.
CIP assets also include a CIP asset indicator that identifies the asset as CIP for reporting purposes, even after it moves out of the Construction in Progress state.
About capitalization journal entries
When you capitalize a CIP asset, Fixed Assets Management creates a journal entry to move the accumulated costs from the CIP GL account to the Asset GL account. This journal entry is recorded using the Fixed Assets Management journal. A link to the capitalization journal entry appears on the asset’s CIP tab.
The capitalization journal entry includes the following information from the asset:
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Posting date: The capitalization date.
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Description: "CIP capitalization: ID--Name", where "ID--Name" is replaced with the asset's ID and name.
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Memo: The description field of the asset.
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Dimensions: All dimensions are copied over from the asset.
Example journal entry
|
GL account |
Debit ($) |
Credit ($) |
|---|---|---|
| Asset | 13,000.00 | |
| CIP | 13,000.00 |
