What is a fixed asset?
An accounting asset is defined as an asset that allows the company to generate an advantage for the company. Fixed assets are physical, intangible or financial assets that a company owns and wishes to use for more than one year.
What is fixed assets management?
Fixed asset management is an accounting method whose aim is to control the life cycle of fixed assets and optimise the company’s accounting. Fixed asset management allows businesses to:
- track fixed assets,
- reduce maintenance costs,
- improve operational efficiency…
What are the different types of fixed assets?
Tangible asset
The company wishes to use a tangible asset over several accounting years. This fixed asset can have three ways of being used: during production, being rented to a third party or for the internal management of the company. These elements include, for example: land, vehicles, furniture, computer equipment, etc.
Intangible asset
An intangible asset is an asset that is not physical and is not monetary. These elements include: patents, licenses, brands, websites, goodwill, etc.
Financial asset
Financial assets are found in class 26 and 27 accounts, these are the monetary assets of a company. This includes: immobilised securities, loans granted by the company to third parties, etc.
How does accounting manage the depreciation of fixed assets?
When a company purchases fixed assets, they are amortised over several financial years via a depreciation plan. They can be amortised in three different ways.
Linear depreciation
A linear depreciation plan allows the financial value of the asset to be distributed regularly. The annuities will be constant and will not be subject to variations regardless of the amortisation duration.
Decreasing depreciation
A decreasing amortisation plan allows the annuities to evolve in a decreasing manner. This method cannot be applied to passenger vehicles and goods that have a lifespan of less than 3 years.
Exceptional depreciation
An exceptional depreciation plan allows for accelerated tax depreciation of certain assets. This type of depreciation does not exist in accounting because it constitutes tax arrangements. The duration of the exceptional depreciation is between 12 and 24 months. The company benefits from a tax advantage over the first months which it will then have to reintegrate in the following years.