A Definition of Fixed Assets
Fixed assets are also known as Infrastructure Assets, which can include road signs, bridges, tunnels, water and sewer systems, dams and lighting systems, land, buildings, equipment and machinery. Fixed assets differ from moveable assets in that fixed assets are fixed in place, typically attached or connected to a building, while moveable assets are not. Fixed assets are not inventory or items available for resale, but are company property often used in the course of conducting business.
Examples of Fixed Assets
While fixed assets are generally assets that are not moveable, that doesn’t mean the category excludes anything that could be moved, such as computers or filing cabinets. Instead, think of fixed assets as assets that are rarely passed from location to location, but typically remain connected at a permanent or semi-permanent location and are used in the course of conducting business over time.
Examples of fixed assets include:
- Computers and office equipment, such as copiers, scanners, and printers
- Buildings and land
- Heavy machinery and equipment
- Furniture, such as conference tables, desks and filing cabinets
- Road signs, bridges, and tunnels
- Water and sewer systems
- Lighting systems
When a business liquidates its assets, it is generally selling off these types of fixed assets that carry a high value and would otherwise be maintained by the company and used to manufacture products or provide services to customers.
Benefits of Fixed Asset Management
Fixed assets are generally high-value assets that companies make use of over the course of several to many years. For this reason, it may seem as though fixed asset management is less critical than tracking moveable assets. There’s less to no risk of loss, theft, and unauthorized transfer with fixed assets, but tracking these assets is an important business function for several reasons:
- Depreciation – Often, fixed assets are depreciated over time, and not every fixed asset has the same lifecycle. That means you need a method for monitoring the status and current value of your company’s assets, whether it’s an asset that can be moved from location to location or an asset that remains fixed in place and will serve your company for decades.
- Managing maintenance and repairs – Fixed assets such as heavy machinery require ongoing maintenance and repairs. When your company is managing dozens to thousands of high-value fixed assets, keeping track of the maintenance requirements that keep your most valuable equipment in working order is no simple task.
- Regulatory requirements – In addition to ensuring that you’re properly depreciating your fixed assets in accordance with applicable tax code, your company may have other regulatory agencies to which you’re responsible for reporting on the status and value of your fixed assets.
It’s beneficial – and necessary – for every business to have a clear picture of its overall value and assets by understanding not only what fixed and moveable assets the company owns, but also the value of each individual asset. Tracking ongoing depreciation helps companies understand the current value of fixed assets as well as plan routine maintenance to maximize the lifespan of high-value assets and avoid the costs associated with premature repairs and replacements.
Options for Fixed Asset Tracking
There are a variety of options available for tracking fixed assets. Choosing the best fixed asset labels depends largely on the nature of the asset and the typical environmental conditions to which these assets are exposed.
From utility barcode labels and meter tags suitable for utility applications to durable barcode labels and asset tags for harsh environments, such as manufacturing and processing environments, there are barcode labels and asset tags available to suit a wide range of applications and specifications.
For more information about fixed assets and tracking fixed assets, check out the following resources:
- Property Identification Tags and ID Labels for Property Management
- 5 Key Components of an Asset Management Framework
- Asset Tracking Tips: Solutions and Strategies to Help Successfully Track Your Business’s Most Valuable Assets
- 50 Top Automatic Identification Systems and Technology Tools for Data Capture
Asset Tracking Solutions from Camcode: