Ghost assets haunt most businesses. No, they aren’t actual ghosts. They are purchases you have made over the years like machinery, furniture, equipment, and so on, before they disappeared. Sometimes they’ve been sold off while in other cases, they have just been packed away. Just because they’re gone doesn’t mean they aren’t still costing your business.
The Intended Course of Business Assets and Consequences
Your business assets must be monitored. Through fixed asset management, you keep track of and manage the assets you possess. Throughout the course of those assets’ lives, you gradually depreciate them according to the tax schedule. Once they reach the end of their term, they are removed from your books. Over the course of the depreciation, you wind up with deductions that you can take.
When assets are not accurately tracked , they become ghost assets. At this point, you start paying severe consequences. You could wind up overpaying on both your taxes and your insurance by more than 30 percent if you don’t remove these items from your books.
The Best Solution
The best, in fact, the only real viable solution is to make sure that you track your fixed assets. Fixed assets are far more than mere inventory. Because they depreciate in value, they are not consistent. This means that what you paid is not necessarily what they are worth. You have to consider a number of factors to determine the current value of the asset.
For tracking fixed assets, the most reliable method is to invest in an inventory tracking system. Inventory tracking allows you to monitor your business’s assets and track the depreciation so that you know how to adjust your business’s value and the depreciation. You have a handy list of all the assets within your business. With an asset tracking system like Asset Panda, you can update them quickly and easily and even include notes to make sure that you get all of the details.
Look for Your Ghost Points
Investing in a trustworthy software package like Asset Panda will go a long way for getting the ghost assets out of your business. However, its reliability depends on your thoroughness. This means that when you first get Asset Panda, you need to go through your business and catalog everything that you own. You can’t forget the chairs in the storage room or the printer stacked on top of the broken copier in the back room.
As you are doing this, make sure that you pay attention to your potential ghost points. These are the places within your business where you are most likely to abandon your current assets and let them become ghost assets. Often times, this is the storage room, the warehouse, satellite offices, and other such places. Once you target these ghost points, you need to make sure that you monitor what goes through there so that you can accurately track the information through your Asset Panda app.
Maintain Regular Updates
As with just about everything in the business world, one of the greatest ways to avoid a problem is by making sure that you are regularly updating your asset information. Through Asset Panda’s simple and intuitive mobile structure, you can easily track those assets to make note of their depreciation and subsequent retirement from business use. This, in turn, will help to ensure that you are actually paying a fair and valid amount on both your taxes and your insurance. With the average business over paying by as much as 30 percent, the next question you’ll have to address is what you’re going to do with all that extra money.