Fixed asset register definition
/What is a Fixed Asset Register?
The fixed asset register is a detailed listing of every fixed asset that has been acquired or built by a business. It is usually based on information contained within the fixed assets module of the accounting software used by a business. The information contained within this register typically includes the following items:
Asset name
Unique asset identification number
Asset cost
Asset location
Responsible manager or department
Asset class assigned to the asset
Useful life assigned to the asset
Salvage value assigned to the asset
Accumulated impairment charges
Current carrying amount
Accumulated depreciation associated with the asset
Depreciation method used to depreciate the asset
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In addition, the register may contain other information that is not needed for accounting purposes, but which is applicable to company operations, such as the following:
Insurance applied to the asset
Asset condition
Asset usage level
Advantages of a Fixed Asset Register
There are several advantages associated with maintaining a fixed asset register, which include the following items:
Improved asset tracking. A fixed asset register helps businesses keep an accurate record of all assets, including location, condition, and ownership. This reduces the risk of loss, theft, or misplacement, especially for high-value or mobile assets.
Source for depreciation calculations. The register records the purchase date, cost, and depreciation method for each asset, ensuring consistent and accurate depreciation over time. This supports proper financial reporting and compliance with accounting standards.
Information source for auditors. Auditors can easily verify the existence and condition of assets using the register. It also ensures the business complies with internal controls, tax regulations, and asset management policies.