Benefits of Fixed Asset Management Solutions – Location Tracking
Fixed assets being a high value investment for most firms, the necessity of keeping track of these is paramount for a company. At the same time, many fixed assets can be used by multiple departments and may even have owners changing during the lifetime of the asset. Consider these two examples:
In an IT company, the average employee attrition rate is 15%. On an average the entire ownership record for laptops would change in 7 years or less, not counting obsolescence, which would make it even shorter. So tracking what IT asset is assigned to which employee is critical, since mission critical data may be lost if the asset is misplaced or destroyed/liquidated by mistake.
In a construction company, the critical equipment like excavators, cranes, cement mixers, etc. are deployed at multiple sites based on the project requirement and keep changing. At the same time, tracking their utilization and maintenance centrally is critical for their optimal utilization and productivity.
In such cases, tracking the assets with the use of various tagging and identification technology is a great way to keep on top of what the organization has in possession and where it is located within the organization. Tracking and identification tools could range from bar codes to QR codes or even sophisticated RFID and GSM tags to determine the location of the equipment, depending on the size and value of the item in question.
The process is relatively simple. During an inventory audit, each tagged asset will be given a unique identification number and a corresponding barcode or QR Code, which can be scanned, and physically verified and then it is added into one extensive database.
There are many benefits correlated with an asset verification system, but it’s not the only element of asset management software that an organization should be taking up for operational efficiency. There is a lot to be extracted in calculating the value and useful life of the assets, as well as having a systematic method for tracking fixed asset data.
Given below are a few benefits of a fixed asset management solution that needs to be talked about more apart from location within an organization.
Effective Purchase Planning:
By understanding where an organizations asset falls in their useful life cycle can help in the effectiveness of purchase planning. Organizations which have an out-dated fixed asset register (FAR) often discover that a vital asset has reached the end of its useful life, and needs to be replaced. This lack of serial knowledge about the fixed assets can result in overspending. If the organization is aware of a large purchase months or even years in advance, they have the time to research for more options and create a financial plan.
Keeping records of the assets based on their current condition will also give the chance to determine the best way to dispose the asset as and when required.
Staying Compliant with Accurate Financial Statements:
A fixed asset management solution needs to be suitable enough to automate the process of depreciation and also examine the fixed assets which are nearing the end of their useful life. When you maintain accurate information on your fixed assets, the processes of determining the appropriate depreciation schedule and, if required, tax liability is simplified. The process of determining the apt depreciation schedule and tax liability if it is required are clarified if the information of fixed asset register (FAR) is accurate enough. An accurate picture of the assets can also help ensure the building contents receive the appropriate insurance coverage.
The right software solution for fixed asset management software can provide a number of tools to assist the organization in preparing for an audit which includes:
Automated Depreciation: Depreciate and track fixed assets in an effortless, audit friendly manner.
Reports: Reports can be premade that meet the demands of the auditor and also create your own reports.
Being able to search data, run reports, and demonstrate a complete audit in a hassle free manner is a win-win for everyone. Therefore the use of Fixed Asset Tracking solutions like Tracet is critical for companies to keep better track of their assets and plan for their operational efficiency.
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