How to Use NetSuite Asset Management for Fixed Assets & Depreciation

Key Takeaways

• Organizations using NetSuite FAM achieve 30% fewer depreciation errors and 25% improvement in tax compliance compared to spreadsheet-based tracking
• The fixed asset management software market reached nearly $5 billion in 2024 and continues growing as businesses prioritize automation
• NetSuite FAM supports multiple pre-built depreciation methods including Straight Line, Declining Balance, and custom formula options
• Finance teams save significant time on depreciation calculations and journal entries with automated processing
• Audit preparation time decreases significantly with complete transaction history and audit trails

Understanding NetSuite Fixed Asset Management (FAM)

NetSuite's Fixed Asset Management module is a native SuiteApp that automates asset lifecycle management—from acquisition through depreciation to disposal. Unlike standalone asset tracking tools, FAM integrates directly with NetSuite's General Ledger, eliminating manual reconciliation and providing real-time visibility into asset values.

What FAM Actually Does

The module handles critical financial processes that traditionally require extensive manual work:

• Automated depreciation calculation and posting — Runs monthly or annually with batch journal entry creation
• Asset lifecycle tracking — Full history from purchase order through disposal with complete audit trail
• Multi-book accounting — Parallel depreciation schedules for GAAP, IFRS, tax, and internal reporting
• Asset proposal workflow — Auto-generates asset records from vendor bills and purchase orders
• Lease accounting compliance — Built-in support for IFRS 16 and ASC 842 right-of-use asset depreciation

The real power lies in the integration. When your AP team posts a vendor bill for equipment, FAM can automatically propose asset records with inherited depreciation settings. When depreciation runs, journal entries post directly to your GL without manual intervention.

Why This Matters for Your Business

Organizations maintaining legacy spreadsheet systems face compounding problems. After consolidating into NetSuite FAM, organizations achieve a 20% increase in financial reporting accuracy and measurable improvements across compliance metrics.

If you're wrestling with similar challenges, our 30-Minute Fix consultation can help identify quick wins in your current setup.

Setting Up Fixed Asset Management in NetSuite

Proper configuration determines whether FAM becomes a growth driver or a recurring headache. The setup process follows a logical sequence that builds upon each previous step.

Step 1: Enable Required Features

Look for Setup > Company > Enable Features and activate:

• SuiteCloud tab: Check SuiteScript and SuiteFlow
• Accounting tab: Check Fixed Asset Management
• Subsidiaries feature (if multi-entity deployment)

After saving, allow NetSuite 2-3 minutes to refresh. The "Fixed Assets" tab should appear in your main navigation.

Step 2: Install the FAM SuiteApp

Go to Customization > SuiteBundler > Search & Install Bundles:

1. Search for "Fixed Assets Management" (Bundle ID: 508242)
2. Click Install and accept terms
3. Enable auto-update for bug fixes

Step 3: Configure General Ledger Accounts

Before creating asset types, establish your account structure:

• Fixed Asset accounts — Balance Sheet (Asset)
• Accumulated Depreciation accounts — Balance Sheet (Contra Asset)
• Depreciation Expense accounts — P\&L (Expense)

Link these defaults in Fixed Assets > Setup > System Setup > General Preferences.

Step 4: Create Asset Types

Asset types serve as templates that determine depreciation behavior for each category. Navigate to Fixed Assets > Setup > Asset Types > New.

For each type (Computer Equipment, Vehicles, Office Furniture, Machinery), configure:

• Default depreciation method (e.g., Straight Line)
• Default useful life (e.g., 5 years for computers, 7 years for vehicles)
• Residual/salvage percentage (typically 0-10%)
• Depreciation Active \= TRUE (critical setting many miss)
• Default GL accounts from Step 3
• Depreciation period (Monthly or Annually)

This single mistake—leaving "Depreciation Active" set to FALSE—causes more implementation failures than any other configuration error.

Step 5: Configure Depreciation Methods

NetSuite includes pre-configured methods:

• Straight Line
• Fixed Declining (variant names vary by account)
• Fixed Declining / tax depreciation methods (labels vary by account; confirm in your NetSuite list)
• Sum of Years Digits
• Asset Usage
• 4-4-5 Calendar methods

For unique business needs, create custom methods using NetSuite's formula builder at Fixed Assets > Setup > Depreciation Methods > New.

Understanding how to create workflows can further enhance your FAM implementation with approval processes and notifications.

Adding and Tracking Fixed Assets in NetSuite

Once configuration is complete, you can begin populating asset records through manual entry, automated proposals, or CSV import.

Manual Asset Entry

Navigate to Fixed Assets > Transactions > Asset Management > New:

1. Enter Description, Asset Type, Acquisition Date, and Cost
2. System auto-populates defaults from your Asset Type settings
3. Review depreciation schedule preview
4. Save record

Each asset record maintains complete transaction history including purchases, transfers, revaluations, and disposals.

Automatic Asset Proposals

This feature transforms your workflow from reactive to proactive. When vendor bills post with lines coded to Fixed Asset accounts:

1. Transaction appears in Fixed Assets > Transactions > Asset Proposals
2. Review auto-populated details
3. Adjust if needed
4. Click "Create Asset"

The system inherits all settings from the linked Asset Type, reducing data entry time from 15 minutes to under 5 minutes per asset.

CSV Import for Existing Assets

For mid-life asset migration, proper data preparation prevents double-depreciation:

Required fields:

• Asset name, description, acquisition date, cost
• Asset type, subsidiary, location, department
• Depreciation start date
• Last Depreciation Date (critical for mid-life assets)

After upload, run "Precompute Depreciation Values" in System Setup. This generates accurate remaining-life schedules that align with your historical records.

A technology firm successfully migrated 200+ assets in one day using this approach, with depreciation schedules matching their Excel projections exactly.

Calculating and Posting Depreciation in NetSuite

Monthly depreciation transforms from a multi-day process to a 30-60 minute task with proper FAM configuration.

Running Monthly Depreciation

Navigate to Fixed Assets > Transactions > Asset Depreciation:

1. Select period end date (e.g., January 31, 2026)
2. Choose subsidiaries and asset types to include
3. Enter depreciation reference (e.g., "Jan 2026 Depreciation")
4. Click "Depreciate Assets"
5. Review generated journal entries
6. Journals auto-post to GL (or require approval if workflow enabled)

The system calculates depreciation for all active assets simultaneously, creating summarized or individual journal entries based on your System Setup preferences.

Understanding Depreciation Methods

Each method serves specific accounting purposes:

Straight-Line: Equal annual depreciation over useful life. Best for assets with consistent utility.

Declining Balance (150% or 200%): Accelerated depreciation front-loads expense. Commonly used for tax reporting under MACRS rules.

Sum of Years Digits: Accelerated method providing higher early-year depreciation that decreases systematically.

Asset Usage: Depreciation based on actual usage metrics (hours, miles, units produced). Ideal for manufacturing equipment.

Multi-Book Accounting for GAAP vs Tax

Organizations needing parallel reporting benefit from Multi-Book Accounting. Configure different depreciation methods for the same asset:

• GAAP Book: Straight-Line method, 10-year life
• Tax Book: 150DB method, 7-year MACRS life

Both books generate separate GL postings, eliminating manual book-to-tax reconciliation. Note that Multi-Book requires an additional license from Oracle NetSuite.

For more ways to streamline financial processes, explore NetSuite automation techniques.

Managing Asset Revaluations and Disposals in NetSuite

Asset lifecycle events beyond routine depreciation require specific handling to maintain accurate records and GL balances.

Processing Asset Revaluations

When fair market value changes significantly, FAM supports revaluation adjustments:

1. Navigate to the asset record
2. Enter new valuation amount
3. System calculates gain/loss
4. Journal entries post to appropriate accounts
5. Future depreciation adjusts based on new value

This capability proves essential for organizations following IFRS revaluation model requirements.

Recording Asset Disposals

Disposal processing handles sales, retirements, and write-offs:

Full disposal:

1. Access Fixed Assets > Transactions > Asset Disposal
2. Select asset and disposal type
3. Enter proceeds (if sold)
4. System calculates gain/loss based on NBV
5. Posts closing entries to all affected accounts

Partial disposal: For assets with multiple components, dispose of portions while retaining remainder.

The system maintains complete disposal history for audit purposes, including disposal date, method, proceeds, and calculated gain/loss.

Reporting and Analysis for Fixed Assets in NetSuite

Robust reporting transforms FAM from a compliance tool into a strategic asset management platform.

Standard Fixed Asset Reports

Access pre-built reports at Fixed Assets > Reports:

• Asset Register — Complete listing with current NBV
• Depreciation Schedule NBV Report — Projected depreciation over asset life
• Depreciation Monthly Report — Period-specific depreciation amounts
• Asset Summary — Aggregated values by type, location, or subsidiary

These reports provide audit-ready documentation without manual preparation.

Custom Fixed Asset Saved Searches

For specialized analysis, NetSuite Saved Searches unlock deeper insights:

• Assets approaching full depreciation
• Depreciation expense by department trending
• Asset utilization metrics
• Warranty expiration tracking
• Maintenance cost accumulation

Building effective saved searches requires understanding formula columns and result filtering, but the resulting visibility justifies the learning curve.

Monthly Reconciliation Process

Maintain GL accuracy through consistent reconciliation:

1. Run Asset Register report
2. Compare totals to GL balances:
3. Fixed Asset GL \= Sum of all asset Original Costs
4. Accumulated Depreciation GL \= Sum of all asset Accum. Depreciation
5. NBV \= Fixed Assets - Accumulated Depreciation
6. Investigate discrepancies immediately

Organizations skipping monthly reconciliation for 6+ months often face unfixable data integrity issues.

Common Challenges and Solutions in NetSuite Fixed Asset Management

Even well-planned implementations encounter obstacles. Recognizing common patterns prevents extended troubleshooting.

Top Configuration Mistakes

Depreciation Active \= FALSE

• Frequency: Very Common
• Solution: Edit Asset Type, change to TRUE, verify all types

Wrong Depreciation Start Date

• Frequency: Common
• Solution: Delete and recreate asset, or run adjustment calculation

FAM ≠ GL Balances

• Frequency: Occasional
• Solution: Run Reset Values then Precompute Depreciation Values

Missing Depreciation Schedules

• Frequency: Common
• Solution: Trigger Precompute Depreciation Values manually

Mid-Life Double Depreciation

• Frequency: Common (migration)
• Solution: Set Last Depreciation Date correctly in CSV

When DIY Works vs When to Get Help

DIY implementation is appropriate when:

• Single subsidiary, single book (GAAP or tax only)
• Fewer than 100 assets
• Standard depreciation methods only
• No complex asset hierarchies

Professional support recommended when:

• Multi-subsidiary with inter-company transfers
• Multi-book accounting requirements
• Legacy asset migration with 3+ years history
• FAM register doesn't reconcile to GL

Troubleshooting NBV Discrepancies

Net Book Value mismatches between FAM and GL require systematic investigation:

1. Verify all asset types have Depreciation Active \= TRUE
2. Check for manual journal entries bypassing FAM
3. Review vendor credit postings after asset creation
4. Confirm depreciation periods haven't been skipped
5. Validate multi-book posting rules if applicable

Most discrepancies trace to one of these five root causes.

How Anchor Group Helps with NetSuite Fixed Asset Management

Implementing NetSuite FAM correctly requires both technical expertise and practical accounting knowledge. That's where working with local NetSuite consultants makes the difference.

At Anchor Group, we don't just know NetSuite—we nerd out over it. Our team has configured FAM implementations across wholesale distribution, manufacturing, and software companies, giving us firsthand experience with the scenarios that trip up most organizations.

What sets us apart:

• Industry-specific expertise — We've solved fixed asset challenges for manufacturers managing complex equipment hierarchies and wholesale distributors tracking fleet assets
• Migration experience — Our consultants have successfully migrated thousands of mid-life assets without double-depreciation issues
• Ongoing support — Working with us feels like calling your neighbor for help—familiar, reliable, and no fuss

Whether you need a full FAM implementation or help troubleshooting existing configuration issues, our 30-Minute Fix consultation provides a no-pressure starting point.

As one client noted about working with our team: "From the beginning the team was invested in our goals, didn't over-sell us, and gave us a timeline and budget that worked." That Midwestern approach to honest partnership drives everything we do.

Frequently Asked Questions

What is the Fixed Asset Management module in NetSuite and how does it benefit my business?

NetSuite FAM is a native SuiteApp that automates fixed asset tracking from acquisition through disposal. It integrates directly with your General Ledger, eliminating manual reconciliation while providing real-time visibility into asset values. Organizations typically save significant time on depreciation calculations and achieve 30% fewer errors compared to spreadsheet-based tracking.

Can NetSuite handle different depreciation methods for various asset types?

Yes. NetSuite includes pre-built methods including Straight Line, Declining Balance (150% and 200%), Sum of Years Digits, and Asset Usage. You can assign different default methods to each asset type, and with Multi-Book Accounting enabled, run parallel GAAP and tax depreciation on the same asset simultaneously.

How can I ensure accurate tracking of fixed assets across multiple locations?

Configure location fields on each asset record and use saved searches to filter by location. For multi-subsidiary deployments, NetSuite OneWorld provides additional controls for inter-company transfers with automatic journal entries. Monthly reconciliation reports should segment by location to catch discrepancies early.

What are best practices for reconciling FAM to General Ledger accounts?

Run monthly reconciliation comparing FAM register totals to GL balances. Fixed Asset GL should equal the sum of all Original Costs; Accumulated Depreciation GL should match the sum of all asset Accum. Depreciation. Investigate variances exceeding $1,000 or 2% immediately—common causes include skipped depreciation periods, manual journal entries, or incorrectly configured asset types.

Is it possible to automate depreciation posting to reduce errors?

Absolutely. Once configured, depreciation runs execute with minimal manual intervention. Select your period, subsidiaries, and asset types, then click "Depreciate Assets." Journal entries generate automatically based on your summarization preferences. For additional automation, NetSuite workflows can trigger approval notifications or schedule recurring depreciation runs.