Importance of Asset Register

Importance of Asset Register

Why Asset Register is so important? The importance of fixed asset register in an organisation cannot be over emphasized and is sometimes overlooked by small businesses, yet a lot of organisations fail to have one or, if they do have one, it is often not kept up to date. You simply lose sight of your valuable asset, if there is no well organised and maintained register.
The Data in an asset register can be invaluable, especially obsolescence, and life term. This supports major asset purchasing decisions and maintenance decisions, the reader begins to view the situation with a lengthier appreciation of time, cost effectiveness and energy management. The outcome is a far more intelligent with the evidence supporting the argument, as to why an action should or should not take place.
In summary, an Asset Register is a critical and vital tool, which enables:
  • to track current condition of assets including age, depreciated and remaining financial value and indication of remaining lifetime, tax benefits, security (preventing and detecting fraud) and insurance purposes,
  • to compile comprehensive scope of works for tendering of maintenance services,
  • to create a comprehensive preventative, predictive and proactive short and long-term maintenance programs,
  • to plan OPEX and CAPEX,
  • to review and assess current performance efficiency of asset plant items,
  • to evaluate potential energy and other sustainability savings,
  • to assess quality of existing maintenance service contracts, service scope and service frequency to get an optimum value for paid maintenance fees,
  • to track compliance of service for certain items to avoid warranty cancellations and penalties from authorities,
  • to evaluate potential cost savings. An asset register presents many cost saving opportunities for most businesses.
Understanding of what assets you have on hand will prevent duplication of asset purchases thus, improving cash flow and profitability.

 

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