Management of fixed assets

Management of fixed assets

[edit] Depreciation
Depreciation is the decrease in the value of an asset due to wear and tear or obsolescence. It is calculated yearly to ensure realistic book values for assets.

[edit] Insurance
Insurance is the undertaking of one party to indemnify another, in exchange for a premium, against a certain eventuality.

[edit] Uninsurable risks
Bad debt
Changes in fashion
Time lapses between ordering and delivery
New machinery or technology
Different prices at different places

[edit] Requirements of an insurance contract
Insurable interest
The insured must derive a real financial gain from that which he is insuring, or stand to lose if it is destroyed or lost.
The item must belong to the insured.
One person may take out insurance on the life of another if the second party owes the first money.
Must be some person or item which can, legally, be insured.
The insured must have a legal claim to that which he is insuring.
Good faith
Uberrimae fidei refers to absolute honesty and must characterise the dealings of both the insurer and the insured.

[edit] Shared Services
There is currently a move towards converging and consolidating Finance provisions into shared services within an organization. Rather than an organization having a number of separate Finance departments performing the same tasks from different locations a more centralized version can be created.