An asset register is important for various reasons. It is helpful in running a business efficiently. Assets register also aid organizations in several ways such as increasing productivity, keeping track of each asset, and so on. In this blog, you will what is the importance of an asset register what are the benefits of maintaining it. So, without any further ado let us begin!
What is a fixed asset register?
It is a list of fixed assets that an organization owns. This register has all the information about each and every asset. This register is specifically important for those organizations which are equipped with a lot of assets.
This list contains asset type, asset location, purchased price, expected useful life, maintenance, expected value at the end of useful life, depreciation taxation, etc.
Depreciation reports come really handy at the end of the financial year. Moreover, you can see all the maintenance expenses done on each asset.
What is the importance of a fixed asset register?
A fixed asset register helps to know how many assets exist and what their condition is and how important each asset is! But without any fixed asset register or software, you will not be able to know how many assets your organizations own, where exactly they are located, what is their present condition, they are maintained or not!
Knowing the answer to these types of questions for a business. Asset register helps organizations in providing answers to these questions and this is why it is important.
What are the benefits of a fixed asset register?
The benefits of a fixed asset register are as follow:
Detailed information – It provides complete information of each asset including asset history that is helpful in making a decision based on data. The data provide crucial information when an asset needs to be disposed of or when it is taking more maintenance than actually required.
Auditing – During an audit, all asset information is required in order to calculate the accurate value of the asset. Overall, they are helpful in calculating the value of the organization. Furthermore, a fixed asset register makes sure the organization complies with the rules and regulations as per the industry. Most importantly it simplifies the physical verification process. It makes the audit process quick and saves time for the organization.
Improves asset utilization – When assets are used without any tracking then assets are underutilized it means they can give more value to the business. When assets are tracked with asset tracking technologies such as Barcode, QR Code (Quick Response Code), RFID (Radio frequency identification), NFC (Near field communication), BLE (Bluetooth low energy), IoT (Internet of Things), etc. They are helpful in providing the real time location of the asset. One can know when asset life expectancy is about to end. You can utilize assets to their full potential.
Depreciation calculation – We know that when an asset is purchased its purchased value is divided into depreciation so that when taxation is done. Organizations can get tax relaxation with depreciation. You can easily calculate depreciation and create reports easily.
Maintenance & calibration – Assets are used continuously and machines work for long hours. Then machines parts are loosened and tore. Moreover, performance is also decreased. So, they need maintenance at regular intervals. In this maintenance, all the wear and tear parts are changed and machines start performing again. The asset register allows you to keep track of maintenance. When an asset needs to be upgraded this register comes in handy!
Avoiding theft – Theft is a big issue across the world. The United States of America businesses alone it is estimated that “It ranges from $20 billion to $50 billion, making it one of the most costly and widespread challenges faced in today’s business world”
When assets are tracked with asset register and asset tracking technology the chances of theft are minimized. Asset tracking is crucial for an organization that is equipped with a lot of assets and more importantly costly assets. Therefore, it is important to keep track of assets and equipment. When assets are tracked their chances of loss, theft, or misplacement are decreased. Furthermore, employees do not waste their time looking for an asset. It indirectly increased the productivity of employees.
What are various types of asset registers?
Mainly there are three types of the asset register. First is a fixed asset register, the second is the digital asset register and third is an IT asset register and. In the fixed asset register there is asset description, purchase cost, and price, salvage value, asset location, asset type, owner, depreciation details, asset details including manufacturer name. The digital asset register contains an asset description, asset location, asset format and type (JPEG, PNG, video, audio), depreciation details. IT asset register contains asset location, asset type (system software, application software), license details, depreciation details, etc.
Which industry uses asset register most?
There are several industries that can utilize an asset register in their business efficiently. The first industry is a car rental service provider, they have lots of vehicles and need maintenance regularly. It will be beneficial during the audit process. The second industry is the health industry just like car rental organizations health industry is also equipped with lots of assets, for them, maintenance is very crucial. The third industry is the IT (information and technology) industry and the last is the manufacturing industry. Asset registers provide in-depth knowledge of assets and equipment where they are when they will be returned. Asset registers also helpful in making strategical business decisions. Undoubtfully, it will be fruitful for all these industries!
Conclusion – There are lots of organizations that rely on manual work or the spreadsheet. But when your business grows your organization has lots of equipment it becomes hectic to manage asset details on a spreadsheet. Moreover, the spreadsheet is not reliable all the information will not be accurate.
The solution is the asset register! It can help your business in several ways that we have discussed above. If you want to take your business to a new level then this asset management software can help you.
Author Bio:
Nishtha Kumari is the content specialist as well as digital marketer. She writes up well-researched content over the latest technology trends for various industries. Her priority is to cover up new technologies in the industry of asset management and tracking. New technologies like helpdesk ticketing system, depreciation tracking software, inventory management software, Utility monitoring, facility management, asset tracking technologies, remote monitoring, maintenance management software, asset audit software, purchasing requisition software, asset register and many more.