Fixed Assets

Fixed Assets

Fixed Asset Management for Small Business

No matter what kind of business you run, 
you probably own property that helps you 
provide products and services. Your company’s 
assets are a valuable part of your operations 
and need to be carefully maintained. 
Use a fixed asset management system to 
organise information about your business

What are fixed assets? 

Fixed assets are long-term items that add value 
to your business. They are tangible assets that 
you do not expect to convert into cash in less than
 one year. Long-term intangible property can also 
be called a fixed asset, like a trademark or patent. 
You buy fixed assets to produce goods or services,
 rent to third parties, or use in your business. 
The following are common examples of fixed 

• Buildings 
• Equipment 
• Furniture 
• Vehicles 
• Computers 
• Land 
• Intangible assets 

Fixed assets have a useful life longer than one 
year. For this reason, inventory is not a
 fixed asset because you want to convert it 
into cash as fast as possible. 

What is fixed asset management? 

Since you operate a small business, managing 
your fixed assets shouldn’t be a huge headache. 
Fixed asset management helps you track, 
protect, and value your company’s assets. 
You can use serial numbered asset tags to 
manage fixed assets. Asset tags are labels with 
bar codes that contain information about each 
asset. You can keep track of your assets by using a
 mobile bar code reader and creating reports. 

Fixed asset management software can help you 
manage business property. There are many 
different kinds of software solutions for 
managing fixed assets. Make sure you choose 
one made for small business owners. 
The software program should be easy to use and 
have all the features you need to manage assets. 

How to manage fixed assets 

To manage fixed assets, keep track of key details 
about your business property. These details 
include the following items. 

You need to know where your fixed assets are 
located. This is important if you use company 
property outside of your business or you open a 
second business location. 
Use a system for tracking when you or a team 
member moves a fixed asset. For example, if your 
employees use company vehicles to meet clients,
 have them record where they go. 
Keep track of how many fixed assets you have. 
This will help you know when to buy more 
property. For example, you might find a good 
deal on a piece of equipment. But if you already 
have enough of the same equipment, you might 
not need to buy another. Or, you might find that 
you don’t have enough equipment and it’s time to
 purchase more. 

Note the condition of your fixed assets. Is your 
business property in pristine condition? Or, is it 
older and could use some work? The condition
of your assets helps you schedule maintenance, 
plan purchases, and determine small business 

Maintenance schedules 
You must keep up with maintenance schedules to 
get the longest life out of your fixed assets. Create 
a general maintenance schedule for your business 
property. When unplanned maintenance occurs, 
note it in your fixed asset management records. 

Depreciation status 
Usually, you don’t report the entire cost of a fixed 
asset in one year. Instead, you depreciate the 
expense to account for the asset’s declining value 
over time. You report portions of the total cost 
over a fixed number of years. You need to track 
each  fixed asset’s depreciation status to know 
what to report on your business tax return. 

Fixed asset management best practices 
The management of fixed assets can be tricky 
if you’re not organised. You need to record the 
purchase, depreciation, and sale of fixed assets in your books. 
The fixed asset management process is for 
accounting, preventative maintenance, and theft 
deterrence. You need to know the following 
information about your fixed assets: 
• Your legal and reporting obligations for fixed 
• How you handle depreciation 
• Your budget for fixed assets 
• The location of your fixed assets 
• The value of your fixed assets 
• The dollar amounts you buy and sell fixed 
assets for 

You can use data to create reports about business 
property. The reports help you review your 
financial health, file tax forms, and talk with 

The importance of fixed assets management 
Managing fixed assets makes it easier when issues 
and opportunities come up. Here are just a few 
ways fixed asset management can help your 
business succeed: 
• Get through unexpected repairs and other 
property issues smoothly: As a small business 
owner, you know that unforeseen events happen 
every day. When something breaks, it’s easier to 
handle the issue if you already know what’s going
 on with your assets. 
• Know the best times to purchase new assets: 
Fixed asset management shows you the right 
moments to jump on opportunities to gain assets. 
• Keep up with your tax obligations: 
When you buy long-term assets, you usually 
depreciate them. 
Fixed asset management helps you accurately 
calculate depreciation expenses and see an asset’s 
depreciation status. 
• Determine the value of your business: 
Fixed assets add value to the overall worth of your 
company. This is important for selling your 
business and speaking with investors. 

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