Determining whether in-house fixed assets management is right for your company is a complex issue. Reasons for bringing this function in-house vary, and there may be alternatives that will achieve the same goals a different way. Because each company has unique needs, you don’t need to take an all-or-nothing approach.
Options for in-house fixed assets management
Tax departments see a variety of scenarios. Of course, a corporation may manage assets 100 percent through their in-house staff. On the other hand, some companies co‑source the day‑to‑day tasks to a third party and participate only as reviewers. Lastly, many companies outsource the entire process to a third party, from asset entry to report output.
However, the size of your company doesn’t necessarily have any bearing on the solution. “One thing that we are not seeing is a correlation between a company’s size and whether the company is insourcing or outsourcing,” says Traci VanSant, CPA, MST and Solution Architect for Wolters Kluwer Tax and Accounting North America. So whether a company has a few thousand or 100,000 assets, it may benefit from in-house fixed assets management.
Since company size and number of assets doesn’t determine whether a company should switch to in-house fixed assets managements, companies should examine why they might want to switch. There are a few different reasons that companies bring fixed assets management in-house. “One pressure point affecting efficient fixed assets management is constantly changing tax rules. Companies are tightening up policies and procedures for final tangible property regulations from rule changes a couple of years ago,” VanSant points out. “How are they tracking DeMinimis assets? They need to record 481a adjustments and write offs.”
In addition to changing compliance requirements, companies adopt in-house fixed assets management in order to:
- Minimize consulting fees.
- Gain control over the entire process.
- Get valuable insights into business operations.
- Get more robust reports to help project expenses or run monthly or quarterly journal entry reports.
Getting from Your Current State to Your Desired Future
How often is your corporation worrying about its fixed assets software?
If your answer is “frequently,” then you know that incorrect taxes, insurance overpayments and poor purchasing are just some of the risks that result in under-valuing the importance of an accurate fixed assets management solution. In order to overcome these challenges in fixed assets management, you need to address the following areas of workflow:
- Receive and Organize Information – Volume management, completeness, integrated functionality.
- Prepare and Review – Time management, efficiency, accuracy, risk management.
- Deliver and Store – Security, method, integrated functionality, ease of future access.
- Research – Reliable and vast content, easy-to-use, integrated.
- Track – Missing deadlines, visibility, automatic notifications.
Discover how with the right corporate fixed assets management solution can provide major efficiencies for your business. Download the white paper: Simplify Fixed Assets Management to Increase Productivity.