Fixed Asset Valuation And Management: How It Can Help In Decision Making?

Assets are mandatory things that must be taken into account, both by individuals and by companies. Why is that? Because assets are a measure of the level of wealth owned by a person or an institution.

Then, what if the assets themselves cannot be coordinated properly, so that their use does not reach the optimal stage? Will this be a problem in the future? Yes, of course it will be a problem.

By optimizing existing assets, the level of profit will also increase in the future. Although the level of profit in question will differ from one impact to another.

Fixed assets are one of the most important parts of running a business that acts as a provider of the products or services you sell. Because fixed assets in business have a high value, then you must maintain them properly and correctly.

Fixed asset management plays a very important role in managing fixed assets so that they are always able to make a good contribution to your business.

Fixed assets are items intended to be used in a sustainable manner for the activity of the company. They are not destroyed by the first use: they contribute to the production of goods or services for several years and, as such, appear on the assets side of the balance sheet. The notion of service also covers rental to third parties. Fixed assets are valued when they enter the entity, but also in the inventory.

The inventory valuation initiates the process of amortization and depreciation.

The calculation of depreciation and amortization while important, is also part of a larger process: the valuation of fixed assets. Thanks to it, your company can know in detail what the true economic value of a good is.

To carry out the valuation it is necessary to collect information from sources as diverse as operations, administration, accounting and finances of fixed assets. For this reason, it is so necessary to see it as a bastion of its intelligent management and to know it in depth.

When talking about valuation, we must take into account its product: appraisals. That is, the documents in which the evaluation of the assets is established and their estimated value is set, taking into account the use that will be given to it.

Some basic rules in asset valuation are:

  • Consistency.
  • Use reasonable assumptions as a basis.
  • Use all available information.
  • That information must be verified.

In general, the purpose of asset valuation is to provide an opinion on the value of the asset. In essence, the valuation process is carried out in detail, thoroughly, and carefully and carried out in a professional manner. Not just anyone can make a valuation, and this is why, we recommend you to contact CAC.

CAC is a firm having several years of experience in this field and can bring many benefits to your company with its services. We suggest you to consult the professionals of this firm if you want to know true value of your fixed assets.

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