Category: Accounting software and technology

The impact of leasehold improvements

The field of fixed assets isn't strictly limited to single objects or properties. This is especially the case with land-based property, where buildings often house different businesses or residents depending on the circumstance. Because of the clientele, there are often different demands from lessees to change the structure of the building to better suit their needs. Property managers and other management staff often make these adjustments in order to justify a rent increase or invoke other profitable measures. However, what makes these leasehold improvements important is that they are themselves fixed assets. This can make the process of accounting for them…

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The benefits of the cloud for fixed asset accounting

In fixed asset accounting, there is often a lot of inventory that has to be addressed, assessed and depreciated over time. Physical inventories are required, as well as different schedules for the various equipment and properties that a company can own. These processes can be spread out over a multitude of offices, which can cut into efficiency. Accountants should seek to find ways of organizing their assessments done quickly to save time and money as well as improve accuracy on the general ledger. One way of doing this is to move fixed accounting software, as well as general accounting, to…

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Developing more best practices for fixed asset management

Fixed assets aren't something a business should take lightly. While they may not produce anything on their own, the properties, equipment and supplies that are considered assets are what determines the worth and value of a given company. This can be important in financial situations such as buyouts, tax seasons or other events that require such an assessment. More importantly, they allow operations to function normally, no matter the location or the size. Proper fixed asset management will allow companies to maintain better control of their finances and productivity, which will help enable greater efficiency and profitability. Understanding the best…

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The effects of the Alternative Minimum Tax on depreciation

Fixed asset accounting becomes very important with the arrival of tax season. Not having an accurate assessment of the quantity and value of various goods and properties can have two different effects: Either the assets are undervalued and the company is subject to a tax audit, or they're overvalued and the business overpays in taxes. This means taking careful consideration into any variables in taxes that can alter how firms calculate depreciation. This is especially the case when using different methods of taxation, particularly the Alternative Minimum Tax. Understanding the effects of AMT on how a company depreciates its fixed…

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The ideal times to use straight-line depreciation

Various fixed assets require different means to deliver the most value to a business in terms of taxes, resale and contribution to overall net worth. Seemingly minute differences in how a company decides to calculate depreciation can have a great impact on its overall financial health. For many businesses, the use of accelerated depreciation is effective, as it gains the highest value out of the process in case they need to resell or invest in better infrastructure at more frequent intervals. However, there are some assets where that would be not particularly effective, and that is when the more traditional approach of straight-line depreciation…

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