What exactly does an “End-to-end” Fixed Asset Management Solution mean?
An end-to-end FAMS is the one which records the activity of the asset from budgeting and acquisition to disposal of the asset. Fixed assets are crucial for an organisation and so is its proper management and you should not take any risks where there are chances of miscalculation, etc.
Here are the four elements that make an FAMS “End-to-end”-
- Asset Budgeting & Acquisition
There is usually a difference between the budgeted/estimated cost of the asset that is to be acquired and the actual cost at which the asset is acquired. This difference is very important to be realised and tracked as it might affect the organisation’s balance sheet at the end of the year. A good fixed asset management system will track the estimated cost for you and then realise the difference automatically once you have entered the acquisition details.
- Asset Allocation
Asset allocation, with respect to internal organisational fixed asset management refers to assignment of a particular asset to an employee or a group of employees. This enables you to know the exact details and whereabouts of the particular asset and the employee who has it at that moment. Barcode labelling, QR Code Labelling and RFID Tagging can be implemented during allocation of assets to make it easier to track the asset. With an FAMS, you can create custom barcodes and assign them to the assets which would then greatly help you in tracking the assigned asset.
- Asset Tracking
Talking about tracking of fixed assets, people often limit tracking till “what asset is with what employee?”. Tracking is much more than that. Tracking of assets include tracking of the asset itself, tracking of warranties, expiries, renewals and services due (physical as well as IT assets). A good fixed asset management solution provides you with automatic emails and notifications when any services or renewals are due. It also gives you a detailed report of the lifecycle of the asset. Asset tracking is a major part of a fixed asset solution. You can learn more about the essentials of a fixed asset management system here.
- Asset Disposal
Asset disposal is the elimination of an asset from a company’s records, typically by selling or scrapping it. These are often long-term assets that contributed to generating profits, such as machinery, technology or company vehicles. Asset disposal can be mistaken very easily by not recording the correct value or by miscalculating the scrap value. FAMS helps you in recording depreciation on a regular basis, being automated, an FAMS provides accurate calculation regardless of the method of calculation (unless you switch in the course of the lifetime of the asset of course). Having access to the lifecycle of an asset also helps one in proper calculation of the disposal value and the authentication of the depreciation applied over the life time.
In conclusion, an end-to-end fixed asset management solution boosts the efficacy of these four important areas:
- Asset Budgeting & Acquisition
- Asset Allocation
- Asset Tracking
- Asset Disposal
Wondering why you should invest in a fixed asset management solution? Read 4 advantages of an Asset Management Software & How to choose a FAMS?