30 Apr 2020 Ankit Chadha

Fixed Asset Reconciliation: The Purpose and Use

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Businesses need to have an accurate record of fixed assets to make sound business decisions and make sure they do not get over-assessed. Inaccurate records of fixed assets can blind you, your business and may increase strategic, operational, and financial risks. So, fixed asset reconciliation records are essential for an organization.

Let us understand what fixed asset reconciliation means, its purpose and uses.  

 

Fixed Asset

Fixed assets are the properties or resources, including long term assets that are a part of the daily operations of a business. These assets are building, land, office furniture, equipment, vehicles, and computer systems. In a balance sheet, fixed assets are reported at their actual value, and then these values are reduced due to depreciation as well as deterioration.

 

Reconciliation

Reconciliation is an administrative method used to bring together two sets of data and ensure that the figures are accurate and in agreement. Reconciliation is a critical process for determining and tracking the money trails of a company.

The fixed asset reconciliation statement shows a list of book value, credits and debits to fixed asset accounts and accumulated depreciation that is vital for the reconciling sheet and fixed asset register of the company.

 

Fixed Asset Reconciliation Statement

Predominantly, the fixed asset reconciliation statement handles the management of the following:

  • The depreciation on fixed assets has been accurately charged or not.
  • The addition of any newly introduced assets to the company’s specific accounts is acceptable or not.
  • The removal of fixed assets has been appropriately implemented or not.
  • The fixed assets indicate the correct value as on the closing date or not, after making several adjustments.

The above list is just a concise catalogue for the uses of a reconciliation statement. Whereas, planning the fixed asset reconciliation statement is a much more complicated task.

 

The Use of Fixed Asset Management

Fixed asset reconciliation statements and accounting is used for ascertaining standards and guidelines to prepare and reconcile the fixed assets of the company.

  1. Dependable Data Source

Fixed asset reconciliation gives you precisely accurate data that can be effortlessly used for benefitting the management goals. The availability of a reliable data source ensures a high level of competency in the office system as there is no useless expenditure of time.

  1. Amplify your ROI

Fixed asset reconciliation helps substantially reduce expenditure and provides a high return on assets as there is a proper record of all the assets of a company.

  1. High Superiority Work

One of the most important uses for incorporating fixed asset reconciliation is obtaining delivery of high-quality work, which matches the needs of the business.

  1. Overall Efficacy

The primary purpose of fixed asset reconciliation is to improve a company’s overall securities, consistency, swift expansion, pace, services and better customer satisfaction.

 

Why Choose TRC For Your Company’s Fixed Asset Reconciliation?

TRC Corporate Consulting is one of the leading consultancies that help your organization with fixed asset reconciliation accounting. We also provide regular assistance to our clients with the criteria for fixed asset reconciliation and asset management. Our professionals offer expert fixed asset reconciliation statements and management for your organization.

We are renowned for determining the best practices for the process of fixed asset reconciliation. We make sure that you obtain accurate outcomes within the specified deadlines. For an understanding of our services, get in touch with us!