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When carrying out the accounting of a company, both fixed assets and current assets must be taken into account, you can do this by consulting fixed asset management companies in India. The latter are the assets, rights, and credits that can be converted into liquid immediately or, at least, within a period of less than twelve months. On the contrary, fixed or non-current are the most durable. They could be defined as those goods or rights that have been acquired to be used by the company in the normal development of its activities and not to be commercialized.
Examples would be the ship where the products are manufactured, the tools used to do it or the truck used to distribute them. However, the same asset can be a fixed-type asset for one company, while for another it is circulating. In the example of the truck, for a business that sells heavy vehicles, that truck would be a commercial product and not a fixed-type asset.
Types of fixed assets
On the other hand, there are basically two kinds of fixed-rate assets and both have value for the company, in addition to having to be reflected in their accounting with the corresponding amortizations. They are the following:
Tangible
It is the material goods, which can be touched, by the company. The General Accounting Plan itself establishes tangible lands and natural assets, for example, a plot; the buildings, such as the aforementioned case of the ship where the company carries out its production; the machinery used for it (it includes, not only the machines themselves, but also the vehicles and tools); technical facilities, such as assembly lines; the furniture of their offices; the equipment for computer processes, or computers, printers, etc.; the transport elements and, finally, other goods.
Not tangible
They are the most difficult to quantify because they lack materiality, but they also have an economic value. Among them are the brands of the company itself, that is, the names of products that it has registered. Also patents, or articles created by it (for example, software of its creation), and copyright. Likewise, the permits, licenses, and franchises, through which the company has acquired the right to use one good or brand of another.
Inventory of fixed assets
Therefore, these assets have an important patrimonial and financial value for the company. Hence the importance of having a good inventory of them. This should include its main data: code, physical situation, description, value and depreciation, status and useful life.
The correct registration of these assets by fixed asset management companies allows the company to make decisions in financial and fiscal matters. As for the first, it reflects in its accounts both the depreciation and the expenses and income that these assets generate and, with respect to the second, that inventory helps it to optimize its taxes in accordance with the laws in force. It also allows you to save costs, by reducing your investments in unnecessary goods.
Therefore, all companies must carry out, at least once a year that inventory of fixed-rate assets and permanently keep track of those that are operating in them. Likewise, you have to correctly calculate the amortization of each of these assets and keep track of those that have been depreciated to decide what to do with them.
In conclusion, fixed assets are a very important part of the company’s balance sheet and must be well controlled.