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How could my business benefit from Fixed Assets Management?

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One of the more obvious benefits of fixed assets management, particularly for businesses that own a large number of fixed assets, is simply the peace of mind that accompanies a detailed listing and valuation of fixed assets. If your business has carefully identified and listed its plant machinery in a fixed assets register, for example, you’ll know precisely where your most expensive assets are. Additionally, since fixed assets management promotes frequent monitoring of fixed assets, you’re more likely to know if a particular fixed asset requires repair or replacement. Some other benefits include:

• Less tax liability: Proper depreciation of fixed asset values ensures that your business pays as little as possible for your investment in the land, buildings, plant machinery and other fixed assets that make your business profitable.

• Reduced insurance premiums: If you don’t accurately track and value your fixed assets, it’s probable that you’re paying too much for business insurance. As an example, your insurance premiums may still include considerations for fixed assets you no longer own. Tracking your fixed assets allows your business to readily advise your insurance company of necessary changes.

• Accurate profit forecasts: As noted above, fixed assets management allows you and your accountant a greater degree of accuracy in your calculation of profits and losses. Weighing the benefits of your fixed assets against the consumption of the asset provides you with a true statement of profits. Moreover, the monitoring of fixed assets and the process of depreciation can help you determine whether to sell fixed assets or purchase additional fixed assets.

Next Page: What is the role of a fixed assets register within Fixed Assets Management?

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