Importance Of A Fixed Assets Register Accounting Essay

Nigerians by and large are non in the pattern of maintaining proper records of the assets in their detention. We find it hard to follow up on the depreciations and amendss that compulsorily occur to these assets. Investing in fixed assets refers to capital investing and the purchase of long term goods. Fixed assets is a major portion of the entire assets in the instance of all fabrication administrations. Even in the instance of service entities such as hotels, Bankss, fiscal establishments, insurance companies, nomadic / telephone service suppliers etc. it has become indispensable to perpetrate high investing into trappings, equipment, and engineering to pull, and retain clients.

A Fixed Assets Register must be maintained basically in conformance with the regulations regulating corporations, companies, etc. Keeping fixed plus registry avails a company the chance to drag the inside informations, position and location of each fixed plus thereby vouching control and avoiding abuse of assets. Furthermore, it follows-up on holding uptodate cognition of the existent worth of assets, these information will organize a footing for computation of depreciation and besides for the intents of insurance and revenue enhancement. The Fixed Assets Register generates an accurate, complete and customized study that suits the demands of direction.

It besides enables a company to followup on it fixed assets that are non under simple, direct control of the company. This means owned and leased assets, assets under building, and imported plus

This helps to place loss of assets through larceny or sloppiness, provides a topographic point where deprecation can be calculated and inside informations of insurance. The importance of fixed assets register made it really of import to keep an up-to-date recording of these points in a Government Statutory format, integrating the followers:

Purchase Cost

Asset Value after Taxes and VAT availed

Asset Location and Identification

Asset Gross saless specifics

Insurance Detailss

AMC entered into Detailss

Depreciation

etc. ,

The importance of keeping an up to day of the month fixed assets register cut across all faces of life and sector, from single to concern entity or even authorities parastatal. A Fixed Asset Register is that record of all organisational assets.

In clip past these assets are being registered manually in spreadsheets, journals and other manual methods of entering and maintaining check on the depreciation of these points to steer the Management on determinations sing replacing of disused points and turn uping points in an organisation.

There are many grounds for maintaining a fixed assets register ; it is pertinent to cognize that most times Government are more concerned in cognizing the worth of a company ‘s fixed assets by and large for the intents revenue enhancement rating, therefore taking to seting up the statute law in that regard, but every bit much as that is true, there exist several other benefits accrued to holding a cognition of the separate fiscal values of these assets non least for the exclusive intent of a company ‘s insurance.

This record is non merely a simple list ; as it was designed to garner really peculiar informations in a defined and comprehensive mode. In add-on to giving the nature and the composing of a company ‘s fixed assets, the accountant must describe any loss or mutilation of assets every bit good as come ining into the record-book the on-going status and neutering in the values of these assets.

The procedure of supervising the existent get downing point of bulky assets is ever a debatable exercising for whoever is to transport out the exercising, as it can necessitate physical verification, which merely, as the name implies would necessitate physically turn uping and sing each unit of equipment or edifice to determine that they truly existed and that they are in their several locations ; it is a good pattern to label each plus in the registry with the assistance of an etched alpha-numeric acknowledgment figure to do turn uping these points easier ; it is of importance to observe that in the instance of landed belongingss and motor vehicles these are ever appropriately given autonomous enrollment Numberss.

However, most bookkeepers and comptrollers saddled with the responsibility of maintaining the Fixed Asset Register these yearss achieve this with the assistance of specifically designed computing machine application ; these applications has the capableness of bring forthing studies based on demands and conveying together immense volumes of information. These plans or package are designed to do the occupation of maintaining and keeping records of fixed assets less feverish and less cumbrous, thereby ensuing in more accurate records.

Objective of Keeping Fixed Asset Register

To command the acquisition and disposal of fixed assets and guarantee their security and proper usage.

To guarantee that fixed assets are decently accounted for.

Whose Responsibility is the Fixed Asset Register?

In most organisations it is the Head of Accounts that is responsible for the complete and right recording of inside informations on fixed assets.

Procedure for geting Fixed Assetss

Fixed assets may be through one-year budgets of the programme or through contributions. Methods that can be used in the procurance of goods include:

• Competitive Tendering

• Single Source ( Direct Procurement )

• Request for Quotations ( RFQ )

Cost of fixed assets

The cost of an plus is the entire outgo incurred to convey the point to its present location and status which comprise of the purchase monetary value ( per bill ) and any straight attributable cost.

Taging of fixed Assetss

On reception of an plus, the histories unit should given a alone designation grade with unerasable ink/paint. The marker should be alpha-numeric to demo the followers:

– Unit of measurement ; Asset Class ; Location ; and Serial Number

Fixed Assetss Register

A Fixed Assets Register is kept to ease monitoring and control of assets in usage and the undermentioned specifics provided:

Description ; Marks ; Supplier ; Location ; Cost and Remarks.

Disposal of fixed Assetss

An plus may be disposed off after the proper authorization has been sought. Disposal may be by bit, sale, compose off or devastation.

STATEMENT OF THE PROBLEM

Some of the major job associated with fixed assets register they are:

Manual Management of Fixed Assets is cumbrous and hard.

Keeping Fixed Asset Register ( FAR ) manually is non merely hard but they are besides immense and bulky.

Fixed Assets Register requires computations under different subdivisions of Companies Act every bit good as under Income revenue enhancement Act, thereby increasing the computation work.

OBJECTIVES OF THE STUDY

The aim of this survey is to happen a permanent solution to all the jobs associated with the manual maintaining of fixed plus registry.

The survey besides seeks to proffer easier and more accurate records of the organisations assets and depreciation.

Amongst other things this survey presents a portable agencies of record maintaining and depreciation calculation.

Significance OF THE STUDY

This survey is centered on the Computerization and Automation of the whole fixed assets register. By utilizing a really robust Relational Database Management System ( RDBMS ) to pull off fixed assets informations. A RDBMS is a plan that lets you make, update, and administrate a relational database largely with the usage of the Structured Query Language ( SQL ) to entree the database.

It must be said that a success in this survey marks a major discovery in the pattern of fixed assets record maintaining and calculation of depreciation.

Scope OF THE STUDY

This survey takes the design and execution of fixed assets register in a public organisation into consideration with different constituents of the fixed assets register maintaining an effectual and accurate calculation of depreciation.

The survey will supply measure by measure process of making an electronic fixed assets register and the screen shootings of these stairss will be made available at each milepost of the undertaking. The survey focuses more on care of fixed assets register in a public organisation.

LIMITATIONS OF THE STUDY

A Major restriction of this survey has to make with the fact that it is centered fundamentally on the populace organisations which are decidedly fewer in figure than what is gettable in the private organisations most of which are yet to deploy electronic fixed assets register, hence, doing the procedure of obtaining information was about impossible.

Definition of footings

In the class of this survey some words, footings and phrases had been used and will be used. I will non wish to presume that all these words and phrases were all understood. Hence some of the words are defined below- :

Fixed Assets Register:

A Fixed Asset Register is an accounting method employed for enrollment and maintaining check on an administration ‘s major assets. Fixed Assetss include: patents, edifices, office equipments, land, machines, hallmarks, right of first publications, etc. owned for the chief intent of fabrication of goods and trade goods or services rendering and non for points being stocked to be sold.

Public Administration:

A authorities bureau can be described as an organisation in the machinery of authorities that carries out the supervising and transporting out of specific duty. Agencies can be established by statute law or by executive powers. They are largely put in topographic point to provide for specific demand of the citizen, they are funded by the authorities. These organisations can either be established by the federal authorities or the province authorities.

Prophet 10g:

The Oracle Database ( normally referred to as Oracle RDBMS or merely as Oracle ) is a relational database direction system ( RDBMS ) produced and marketed by Oracle Corporation.