10 Fixed Asset Inventory Control Points

What is a fixed asset?

Fixed assets are those movable, immovable and intangible assets that help the company work properly, so they are essential and could not be used for sale. 

It is important to keep inventory control of the fixed assets since it serves to quantify and specify the general and specific aspects and characteristics of the fixed or non-current assets of a company. 

In addition, this process will help to facilitate the audit processes and reduce the time it takes to carry them out, it will also be useful to make the necessary changes that have to be made in the company.  

inventory control

How is inventory control done?

One of the most appropriate ways to carry out the inventory of fixed assets is according to the criteria of the Minimum Indivisible Unit in which the accessories and minor installations and the machinery integrated by the equipment are defined, those spare parts or parts that they have not been placed. 

It consists of five basic stages:

1.- Start: Information gathering, physical inspection and presentation of the work plan.

2.- Pre-start: Physical inventory.

3.- Integration and rectification of the accounting statement: Review of the accounting statement, individual identification of each asset.

4.- Inventory and plating: Filling of formats with all the information of the assets and application of a plate or identification label.

5.-Reconciliation with accounting books: Relate the database made at the beginning of the process with the acquisition cost shown in the corresponding accounting document.

Who should carry out the inventories of fixed assets? 

It is important that all those companies that have movable, immovable and intangible assets that must be constantly replaced carry out this type of inventories since, with this, they will be able to accurately know the devaluation, condition and location of the assets. 

This is why it is recommended that the hotel industry, companies, investment funds and even SMEs carry out this type of inventories, supported by experts or an inventory control system. 

What information is captured in fixed asset inventory control?

In order for an inventory to be carried out properly, there are certain elements that must be taken into account, among them:

  • Name that describes the asset and specific characteristics of each element.
  • Cost center
  • Asset number
  • Previous Plate Number (If you have it)
  • Serial number
  • State of preservation (good, fair and/or poor)
  • Brand
  • Model
  • Location

10 Points for Fixed Asset Inventories Control

Taking into account the previous information, it is essential to follow the following steps to achieve the best use of the fixed assets and have reliable information that is useful for the company's decision making.

1.- If possible, carry out inventory control under the criteria of the Minimum Indivisible Unit.

2.- Do not include spare parts or parts that have not been added in the inventory.

3.- Carry out inventories and/or constant updates so that the information on the devaluation, state and location of the assets is reliable at the time it is consulted.

4.- Include complete information on each asset.

5.- If the company does not have a specific area to carry out inventory control, request the service from an external company with experience in this task.

6.- Make use of specialized software, plates and/or identification labels of fixed assets to facilitate inventory control.

7.- Train staff in the use of specialized software and in the importance of inventory control.

8.- Implement the use of vouchers to have full knowledge of which employee is responsible for which asset and, in this way, avoid losses.

9.- Make use of the database when it is necessary to make decisions regarding expenses for the repair or renewal of assets, in this way the decisions will be supported.

10.- Keep the accounting records organized, since the inventory is based on the reconciliation of both.

Having inventory control will help many aspects of your company, if you are ready to implement this in your organization ANEPSA is here to help you, you just need to contact contact with us.

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