If you’re taking inventory of your fixed assets, you might ask the question Is software a fixed asset? Here are the criteria you need to determine if anything, including software, is a fixed asset:
Fixed assets are items not sold for profit, but which help you generate revenue. You use them over an extended period of time, and they must be tangible. Fixed assets differ from current assets, which intangible items like investments, cash, accounts receivable, prepaid expenses, inventory, marketable securities and other liquid assets that can be converted into cash. In the event of an impending bankruptcy, a company could cash out its current assets to help pay off debts.
If you use the above definitions as your guide, then, is software a fixed asset? It’s intangible, isn’t it? After all, you can’t really touch software. While that’s true, many types of software actually qualify as tangible. The website softwarevalue.com explains: “according to various accounting standards if a software is used to deliver goods and services it can be classified as a tangible asset.” Further, “another criterion to determine if it is tangible or intangible is the cost of the software (to either buy or develop in-house). If the cost of one copy of the software is more than $100,000, then it is considered tangible.” The software you use in your office is most likely used regularly, even daily; and requires routine maintenance and updates, much like equipment. These criteria both describe tangible assets.
The answer to “Is software a fixed asset?” then, is often yes. The software is tangible, and it’s used over an extended period of time (longer than one accounting cycle); its useful life typically includes several reporting periods, and the software isn’t purchased with the intent of resale. If it’s custom software, it’s also likely to meet the pricing threshold mentioned above.
Even with the abundance of accounting software currently available, a lot of companies and organizations, both large and small, continue to depend upon spreadsheets to track their fixed assets’ whereabouts, condition, value and other details. It’s downright difficult if not impossible, however, to maintain your asset records manually without making errors. Whether it’s a simple typo, missed keystroke, duplication of effort or gap in recordkeeping, errors are bound to happen sooner or later. Asset data is an ever-changing entity, which makes manual recordkeeping difficult right out of the starting gate. What companies need, then, is an automated means to track and manage their fixed assets – a platform which centralizes data and serves it up in real time, all the time.
Asset Panda presents the most powerful, yet simple to use asset tracking and management solution in the world. Powered by free mobile iOS and Android apps, Asset Panda syncs with the cloud and includes a mobile barcode scanner, effectively eliminating the need for additional hardware. All you need to track and manage the complete lifecycle of your fixed assets are the mobile devices you and your employees already carry. Add as many users as you’d like for no additional cost. When you can loop all of your stakeholders into the conversation, accountability and accuracy increase significantly. Asset Panda’s robust features are completely customizable, allowing you to track and manage your assets any way you want. Best of all, Asset Panda is flexible enough to incorporate new technologies as they become available in the future. Its user interface is incredibly intuitive, so you won’t need any special training to get up to speed.
From the palm of your hand, you have real-time access to any asset’s exact location, condition, the identity of who has it, its complete maintenance history, depreciation, check-in/check-out status, insurance policy, warranty, lease/purchase information and more. Create work orders and even use Asset Panda as an enterprise service desk to reduce your support call volume.
The best way to experience Asset Panda is to try it free for 14 days. To get started, go to assetpanda.com