---
title: "Depreciation"
space: "ERPNext"
url: "https://docs.frappe.io/erpnext/asset-depreciation"
updated: "2026-03-02"
---

**Depreciation is the process of allocating the cost of an asset over its useful life.**

In ERPNext, depreciation is calculated for fixed assets to reflect their gradual reduction in value over time. The Depreciation module allows businesses to:

- Automate depreciation calculations based on predefined methods
- Maintain accurate accounting records for asset value reduction
- Track depreciation schedules for individual assets
- Integrate with Finance Books for multiple reporting requirements

For example, if you purchase a printer for $300 that is expected to be useful for three years, ERPNext can allocate $100 as depreciation expense each year instead of recording the full $300 in the first year.

## 1. Features

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- **Depreciation Methods:** Straight Line, Written Down Value, Double Declining Balance, Manual
- **Frequency & Schedule:** Set how often depreciation is booked (monthly, quarterly, annually)
- **Accounting Integration:** Depreciation entries are posted automatically to ledger accounts
- **Asset-wise Tracking:** View depreciation per asset, including partially depreciated or fully depreciated assets
- **Finance Books:** Record depreciation differently for multiple reporting purposes

> Note: Depreciation in ERPNext is linked directly to **Assets**. Before using this module, ensure that your **Assets** and **Asset Categories** are properly created.

## 2. Related Topics

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- [Assets](/erpnext/asset)
- [Depreciation Methods](/erpnext/asset-depreciation)