K3 depreciation in Sinom is component depreciation of a building. The book value is divided between the building’s parts, and each part is depreciated over its useful life. The value is then tracked as the maintenance plan capitalizes an investment or writes off something that is replaced.
The feature is only shown if it is turned on for the account. If the tabs and menus described below are missing, the feature is not activated.
Sinom calculates and gathers the supporting data. It does not replace your accounting consultant, and it is not the transition documentation from K2 to K3. The register is based on the allocated book value, not on the acquisition cost and accumulated depreciation per component.
When should I use this?
You are moving a property from a single book value to component depreciation.
You are completing a measure with an investment share and want the investment to be capitalized and anything replaced to be written off.
You need supporting documentation for the board, the financial manager and the auditor.
How it fits together
Depreciation categories control which component types belong together and which depreciation period and initial share they have.
Allocation on the property: the book value is allocated to the categories. This is where the property moves from a single value to component depreciation.
Ongoing investments: when a measure with an investment share is completed, a new asset is created, and anything replaced can be written off.
Analysis shows how the value develops.
The K3 – Component depreciation report is the supporting documentation for the board, the financial manager and the auditor.
Where do you find it?
Settings → Depreciation categories: manage the categories, depreciation period, initial share and the component types included. Only administrators have access to this page.
Property → K3 Depreciation tab: start the allocation, view the assets, add assets, write them off or delete the setup. The same tab is available on buildings.
Component → Depreciation tab: see what has already been allocated to the component, what is active and what is planned.
Measure: enter the investment share here. When the measure is completed, the investment is allocated and replaced assets can be written off.
Analysis → Depreciation: follow book value and depreciation over time.
Reports → K3 – Component depreciation: create the report as a PDF.
Depreciation categories
A depreciation category groups component types and has two default values:
Depreciation period: the number of years over which the category is depreciated.
Initial share: the share of the building’s book value suggested for the category when a property is allocated for the first time.
New accounts get the categories below. The shares add up to 100%. They are a starting point, not a rule. Check the depreciation periods and shares with the person responsible for your accounting before you allocate a portfolio.
Category | Initial share | Depreciation period |
Land | 0% | 30 years |
Frame & foundation | 61% | 120 years |
Heating mains | 7% | 80 years |
Water and sewage mains | 6% | 50 years |
Facade | 5% | 40 years |
Windows | 4% | 40 years |
Roof | 4% | 60 years |
Balconies | 3% | 50 years |
Ventilation | 2% | 20 years |
Cooling | 0% | 25 years |
Elevators | 1% | 20 years |
Electrical | 6% | 50 years |
Control & monitoring | 1% | 25 years |
Interior | 0% | 40 years |
Equipment | 0% | 15 years |
Other | 0% | 20 years |
Categories with 0% are not included in the initial allocation until you set a share or add an asset to them manually.
How to change the categories
Go to Settings → Depreciation categories. The categories are shown on the left and the component types in the selected category on the right.
Here you can:
create, rename and delete categories
move component types to another category
change the depreciation period and initial share
If you delete a category that already has types or assets, you must select a replacement category. The types and assets are moved there.
Allocate a property
Open the property and go to the K3 depreciation tab.
If the property is empty, choose one of two options:
Transition from K2 to K3: choose this when you have a book value to divide between the categories.
Create manually: choose this when you want to add assets one by one, without an initial allocation.
The transition has two steps: Initialize and Adjust.
In the Initialize step, fill in:
Book value: the value to be allocated.
Activation year: the year from which depreciation is calculated.
Remaining depreciation period based on: how many years remain. See “How the remaining period is calculated” below.
Allocate per building: one value and one construction year per building, instead of one value for the whole property.
The building values must add up to the book value. With Allocate, you can divide the value evenly or per m².In the Adjust step, Sinom suggests one row per depreciation category. Check the share, amount and depreciation period.
The initial shares must add up to 100%. If you allocate per building, the shares must add up to 100% per building.Click Preview to recalculate the suggestion. Click Reset to restore the original suggestion.
At the bottom, choose whether Assign to components should be on or off:
On: the assets are linked to the components whose type belongs to the category.
Off: the asset stays on the category without a link to any component.
Save the allocation. The overview for the property is then shown.
How the remaining period is calculated
Construction year: the category’s depreciation period minus the number of years since the construction year. If the construction year is missing, the period is 0.
Remaining useful life of components: the average remaining useful life of the components in the category.
Depreciation period from depreciation categories: the category’s full depreciation period, regardless of age.
The Construction year method requires the construction year to be filled in. The useful life method requires the components to have been inspected. Otherwise, there is no remaining useful life to calculate from.
The assets after allocation
The overview groups the assets by depreciation category. It shows the capitalized value, book value, annual depreciation and remaining depreciation period. Closed assets are hidden until you select Show closed.
Source
K2 → K3 initial allocation: the asset was created during the transition.
Investment: the asset was created when a measure with an investment share was completed.
Manual: the asset was added manually.
Status
Started: depreciation started in the specified year.
Ongoing: the asset is being depreciated.
Closed: the asset was fully depreciated in the specified year.
Written off early: the asset was written off before the end of its depreciation period. The book value is reset to zero.
What you can do
On a single asset, you can:
open the details and view the chart
change the depreciation period or book value. Sinom asks you to give a reason.
Write off the asset.
An early write-off cannot be undone.
An asset that is closed or written off early cannot be edited.
In the overview, you can also:
create a manual asset with Add asset
link an asset to a component with Add component or Link to component. The component’s type must belong to the same category, and the component must not already be linked.
remove all depreciation assets on the property with Delete setup. You can then make a new allocation.
The deletion cannot be undone. You confirm it by pressing and holding the confirmation button.
If the book value of an investment does not match the measure’s cost, the row is flagged. Correct either the measure’s cost or the asset’s value.
Depreciation on the component
The Depreciation tab on the component shows:
the initial allocation, if the component received one during the transition
active depreciation
scheduled investments from planned measures that have an investment share
If the component has no initial allocation, a message says that it does not have one yet. This is expected if you did not assign the allocation to components, or if the component type did not belong to a category with a share.
When you complete a measure
The measure has an Investment share field. 0% means maintenance and does not create any depreciation. A share above 0% is the part of the cost to be capitalized.
When you complete a measure that has an investment share, a depreciation step is shown:
Allocate the investment amount to the linked components.
The total must equal the full investment, and the investment cannot be greater than the actual cost.Select the existing assets on those components that are being replaced and should be written off.
Their remaining book value is reset to zero.
You can save the completion without this step. In that case, no depreciation is created, even if the measure has an investment share.
If depreciation has already been created for the measure, make any further changes directly on the assets. You cannot make them by completing the measure again.
Analysis
Go to Analysis → Depreciation. It shows book value and depreciation over time.
Switch between book value, annual depreciation and the same figures broken down by depreciation category.
Click a year to open a summary for that year. The summary can be grouped by source, depreciation category, building or property.
The key figures can be shown per property, building, area, company or depreciation category, depending on the levels the account uses.
The K3 – Component depreciation report
You create the report under Reports using the K3 – Component depreciation template. It is designed for the annual report and the auditor. It shows what the buildings are worth in the register, how the value is allocated and depreciated, and what the maintenance plan will capitalize.
By default, the report covers 10 years from the current year. It contains the following pages:
Cover, summary, report scope: the period, the properties and a financial summary. The report has no condition or energy section.
K3 – key figures: book value, annual depreciation and remaining depreciation period.
Component breakdown (K3): capitalized value, book value, annual depreciation and remaining period per depreciation category.
Book value over time: the value per year, split into existing assets, capitalized measures and planned investments.
Annual depreciation: depreciation per year and depreciation category, including planned investments.
Planned investments to be capitalized: planned measures with an investment share and the depreciation each measure adds.
Closed depreciation during the year: assets that were fully depreciated or written off early during the year, with residual value and reason.
VAT and price index are turned off by default. Depreciation is calculated on the measure’s stored cost. If you turn on VAT or price index in the report, the investment table may no longer match the chart.
The report is only shown if the account has the depreciation feature.
Frequently asked questions
I have the acquisition cost and accumulated depreciation from K2. Where do I enter them?
The transition in Sinom starts from the book value and allocates it. It does not produce the K2 table with gross acquisition cost and accumulated depreciation per component. That documentation is prepared outside Sinom.
Why is the total in the report higher than in the register?
Check that VAT and price index are turned off in the report’s cost calculation.
Why does a category have 0 years remaining?
The Construction year method subtracts the number of years since the construction year. If the construction year is earlier than the depreciation period allows, or is missing, the period becomes 0. Change the method or adjust the period in the Adjust step.
Why does the component have no depreciation?
Either the allocation was not assigned to components, or the component type belongs to a category without a share. Link the component afterwards or add a manual asset.
Can I start over?
Yes. Use Delete setup on the property to remove the assets. This cannot be undone.