The three main elements of fixed asset management
A central asset register
Compiling an effective database of all assets within an organisation and recording all events in each asset's lifecycle.
Asset tracking & verification
Monitoring the movements of assets and ensuring the register is up to date at all times. This could be the daily process of updating the system via mobile devices or conducting regular asset audits.
Depreciation calculations
Calculating the depreciation and reporting on all financial information associated with the fixed assets on the balance sheet.
What is fixed asset management used for?
-
Compiling a central asset register
-
Recording asset history
-
Audit & certification
-
Insurance records
-
Asset tracking
-
Issuing & returning assets
-
Physical audits
-
Managing non-capitalised assets
Compiling a central asset register
Compiling a central asset register
Organisations may often maintain multiple lists or registers. This causes many problems and is not an efficient way to manage assets. It becomes difficult to verify each list, avoid duplication and produce depreciation calculations. A central register solves these issues and helps to avoid any duplication of asset purchases. Effective Fixed Asset Software is essential for maintaining a central database and will enable you to provide a true and accurate picture of all assets owned.
Recording asset history
Recording asset history
Storing detailed asset information and financial history provides organisations with valuable data to enable business decision making with a full audit trail.
Audit & certification
Audit & certification
Problems with fixed asset management are often flagged up during audits which organisations can fail if they don’t have a good system in place. Using specialist software can help finance teams to meet and surpass audit regulations.
Insurance records
Insurance records
Many companies are paying insurance premiums on assets that are no longer in use. It’s possible that premiums could be reduced if the asset register is always kept up to date. It is also easier to claim if you can provide proof of the assets you own.
Asset tracking
Asset tracking
This is the process of tracking the location and activity of assets on a regular basis. Usually assets are barcoded or tagged so movements can be scanned easily but information on the asset and its location can also be entered manually via a smart device if required.
Issuing & returning assets
Issuing & returning assets
If organisations have roaming assets then it is crucial for companies to track the process of when and to whom, assets were loaned out. The asset register should be updated each time an asset is issued and returned.
Physical audits
Physical audits
Audits are carried out to match the asset register against the actual assets that are located around the organisation.
Managing non-capitalised assets
Managing non-capitalised assets
Organisations also need to keep an inventory of non-capitalised assets. It is best to record these items in the central asset register to maximise effective control and utilisation.
Who uses fixed asset management?
Head office
Organisations must ensure balance sheet values are correct. When the asset register is up to date, resources are utilised more effectively, insurance claims can be proved and lost assets are kept to a minimum.
Finance Department
Effective fixed asset software enables the finance team to calculate depreciation and meet both corporate governance and audit regulations.
Sub offices
Assets at sub offices can be tracked regularly so that information can be sent directly to the central asset register.
IT Department
IT staff need to keep track of asset location and access up to date information about IT equipment.