Every business relies on fixed assets to carry out operations – from buildings, machinery, and real estate, these major investments are important to your profit. Knowing how to record your fixed assets in a balance sheet will provide you with correct financial information.
Here are the steps you need to take to update your balance sheet with all your fixed asset data, from start to finish.
Evaluate Your Current Fixed Assets
Before you can record fixed asset information, you need to know what you have on hand. Take some time to check up on all your fixed assets – visit all of your locations and check the health of your facilities.
Even if you think you’ve checked all of your assets, check all of your property again just to be sure. There might be some equipment, tools or other items being stored in a warehouse you didn’t know about. Someone may not have been able to document the asset, leaving it forgotten.
Document All Asset Information
As you are evaluating the current state of your fixed assets, record everything. During this step, you can’t be too thorough. Document who uses each asset, what it’s used for, when it gets used and anything else that might be related. It’s better for you to write something down that you end up not needing later than for you to forget something important and have to go back.
Don’t forget to record information like how you acquired the asset, any relevant certifications and regulations, maintenance needs and employee skills required for use.
Find a Nuanced Balance Sheet
Not all balanced sheets are created equal. Many companies will try to make do with a spreadsheet or even a series of spreadsheets. When you have to record a large amount of information for each asset, these are not practical. You’ll end up creating more confusion and mistakes in your asset tracking process.
Instead, find a solution that allows you to store all of your asset information. Consider something like Asset Panda, which is an easily customizable solution that allows you to add as many fields as you need. Our platform is also designed to be a holistic business tool, so you don’t have to rely on over a dozen programs to track operations and growth.
Import Information About Fixed Assets to Your Balance Sheet
Once you’ve thoroughly documented all of your fixed asset information, it’s time to send that data to your balance sheet. Sometimes putting asset information directly into your balance sheet from the asset location isn’t possible. Many software programs allow you to import data through integrations.
Putting data about fixed assets in a balance sheet doesn’t have to be hard. In fact, in good business operations, it should be the first step to creating a better workflow for your company. Once you’ve got your fixed asset data in your balance sheet, you can use it to more accurately forecast company growth and identify problems before they become unmanageable. This information will also provide insight into the true worth of your company.
Keeping fixed asset data on a financial balance sheet can also help you identify which assets are a drain on your resources. Without this information, you’d probably continue to lose money and opportunities without fully understanding why.
Want to see how Asset Panda can help you create a more optimized balance sheet? Take a free guided tour today!
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