Fixed Assets Management

What is Fixed Assets Management?

Fixed assets are purchased for long-term use and are not likely to be converted quickly into cash, such as land, buildings, and equipment.

The management of fixed assets such as buildings, fixtures and machinery, which can not be converted to a fair cash value in a timely manner is a vital accounting process. Fixed assets are often managed through the use of asset tags, which are tracked through serial numbers or bar codes, for easier organization, and are filed for the purpose of accounting, maintenance and theft deterrence.

Here are some of the most common tracked fixed assets:

  • Plant and equipment
  • Buildings
  • Fixtures and fittings
  • Long term investment
  • Machinery
  • Vehicles and heavy equipments
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Why is Fixed Assets Management important?

Fixed assets management is important for businesses. We have listed some good reasons to switch to a specialist asset management system.

Identifying Costs

Identifying the value of Fixed Assets in the books with no corresponding assets physically.

Audit Support

Records are now more accurate, tied directly to a tagged physical asset inventory, updated annually, and facilitate auditing tests.  Regulatory Compliance standards are also enhanced.

Informed Purchase Decisions

Increased control over spending money on additional equipment by reassigning and utilizing idle equipment instead of purchasing new.

Improved quality of Financial Reporting

With an efficient FAM system comes enhanced financial reporting and ensures efficient controls over the company’s assets. This also supports the requirements of IFCR which are mandatory from 2015-16.

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Here are some more benefits of managing the fixed assets:

  • Improved Capitalization Policy.
  • Insight in to the life of the Assets (Companies Act Schedule II)
  • IndAS Requirement – Component Accounting – Tax Planning
  • Assurance on availability of Asset
  • Control Mechanism to protect assets from any Embezzlement
  • Eased out asset tracking.
  • Accurate insurance premiums.
  • Assigning accountability and responsibilities.

Economic Benefits

The solution pays for itself

A complete implementation typically uncovers at least 15-30% unrecorded retirements in an organization.

Audit support

Records are now more accurate, tied directly to a tagged physical asset inventory, updated annually, and facilitate auditing tests.  Regulatory Compliance standards are also enhanced.

Decrease carrying costs

More efficiently gather and maintain accurate information on fixed assets. (AMC, Annual Reconciliation etc.)

Improved Internal Reporting

With an efficient FAM system comes enhanced internal reporting and ensures efficient controls over the company’s assets.

Informed Purchase Decisions

Increased control over spending money on additional equipment by reassigning and utilizing idle equipment instead of purchasing new.

Eased out asset tracking

A robust FAM implementation and data management ensures efficient location tracking of the assets supplemented with active updating of asset relocations.

Accurate insurance premiums

Eliminate the concern that the entity is over or underinsured.  Match your insurance coverage and premiums with the actual assets.

Assigning accountability and responsibilities

FAM provides a platform to assign the various assets to the employees of the entity and hold them responsible for the upkeep and security of the assets.

Why Brivan?

We specialise in providing fixed assets management services for clients across various sectors. We are working with companies with presence over the entire nation.

Here are some of our specialities:

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  • žExperience in managing Multi location clients
  • Working on large assignments within stringent timelines
  • žEnsuring quality standardization on assignments across India
  • Delivering cost benefit for our clients
  • Experience of various industries and managing work at various towns in over 20 states across India
  • We build a long term relationship and continue to support as and when required

Scope of Work

  • Update/Create FAR
  • Physical verification of assets
  • Tagging assets – RFID/Barcode
  • Reconciling assets with the financial records
  • Updating financial records basis reconciliation
  • Updating records on FAM software
  • Periodic verification and reconciliation

Features of FAM Software

  • Assets with description, location, custodian can be added
  • Unique bar code for each asset
  • During addition the photo/bill of purchase can be scanned and uploaded in the software.
  • Assigning custodian to individual assets
  • Recording Insurance details with the individual assets
  • Helps in the audit process
  • Rate of depreciation can be changed any time with impact due to such change.
  • Bar-coding can be done on destructible non erasable stickers/Aluminum sheets.

Interested? Learn about our Fixed Assets Management Services.