Category: Legislation and compliance

Continuation of accelerated depreciation tax break still uncertain

Manufacturers, iron and steel companies, oil firms and others have formed a coalition to continue the industry tax break for bonus depreciation. Currently, this bonus hangs in the balance during tax reforms, and the group aims to lobby lawmakers to keep the provision in the tax code, according to a press release from The Cost Recovery Advances the Nation's Economy coalition. The continuation or ending of the tax break will make a difference in how companies manage their fixed assets. Accelerated depreciation allows companies to claim a larger portion of the depreciation value to be claimed early in the cycle, which results…

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Why data security matters in fixed assets

Fixed asset management seems to be the last place that would need data security. After all, it's merely a record of what assets are currently in the books. However, because there is valuable material involved, especially when equipment or furnishings aren't necessarily bolted to the ground, there are security needs that have to be considered. That goes not only towards external security, such as cameras and alarms, but also data security from within the asset accounting software. By taking the right precautions, companies can avoid risky business strategies that end up costing them a lot of money. Understanding the losses To give…

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Fair value accounting’s impact on fixed assets instigates changes

Fixed assets of all kinds have been assessed by their market or "fair" value in the last few decades. It's considered a standard practice in comparison to the other common method of utilizing the historical value of goods. There are many benefits to fair value, in that it allows a more fluid movement of assets as well as a more flexible estimate on the value of a company. Asset accounting software has made many of the associated processes that go with using this value far easier to attain. However, the precise definition of fair value has undergone some scrutiny in…

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Understanding different intangible assets

The variables of tangible fixed assets are well known. There are the materials and supplies used to create products. The machines that develop the raw minerals or parts into the products made by the company are also considered fixed assets, as are any of the consumables that make the equipment work such as fuel and lubricant. The warehouse and land that is owned by the company are properties and thus considered tangible assets as well. Intangible fixed assets, on the other hand, are a different matter entirely. Because they lack physical form, there are varying definitions of what's considered intangible….

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The importance of audit trails

Fixed assets are often a key component in any company's accounting books. Without having accurate information on these critical items, the end result is that businesses fail to adequately assess the value of the company, which can in turn cause mistakes in tax returns. There is a necessity to properly record the acquisition, use and disposal of assets in a firm, as well as any changes in value that can occur in between. Still, there are certain things that a business may feel is perfectly acceptable will turn up red flags by the IRS, triggering an audit. Having a proper…

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