Business Incorporation

As corporate purse strings get increasingly tightened in this period of downturn, the need for organisations to perform IT asset management is becoming more of a priority.It is the IT manager whose role is to manage this process of auditing and tracking IT assets.I have dealt with many IT managers in the past, from a wide range of different organizations, and below is a brief summary of the methods they used to track IT assets.

Spreadsheets
fixed asset register] information in a giant spreadsheet.  The procedure goes along the following lines. At first the spreadsheet is created from an initial asset audit, recording all the hardware and software being used.The most commonly recorded information includes location, name of staff member using the item, purchase date, model and serial numbers and warranty details.The spreadsheet then needs to be manually updated whenever new purchases of hardware or software are made. As with many manual business functions, the spreadsheet’s downfall is that it doesn’t scale well at all.You can imagine how such a spreadsheet would grow to unmanageable proportions as an organization gets bigger.Organizations using the spreadsheet technique also tend not to be able to react effectively to changes in the state of IT assets, such as repairs, depreciation, licenses and getting rid of equipment.  It all depends on an extremely organised person making sure it is meticulously up to date.

RFID and Asset Barcoding
The tagging of assets with barcodes has become the norm in many organizations I have dealt with, wherein each piece of hardware is tagged with a scannable barcode which refers to an exact record in the asset register.  These barcodes can be scanned using barcode scanners during regular asset audits and for helpdesk support purposes. RFID, or Radio Frequency Identification, goes one step beyond traditional barcoding because they allow you to perform a hardware audit without physically scanning each asset. More importantly, RFID asset tracking allows greater flexibility for increasingly mobile equipment such as laptops and PDAs.

Fixed Asset Management Software
There are a good choice of semi-automated and customized asset management software solutions which take a lot of the pain out of the process. I have come across some companies who have created their own custom asset database using SQL and linking this to the intranet to allow multi-user administration. At the most sophisticated end of the scale is specialised “asset management software” (Google it and you’ll see the wide range of options!) covering the tracking, accounting and reporting of ALL fixed assets, not just IT assets, including property, machinery and vehicles.  There are also specially designed solutions to meet the growing plethora of asset accounting and tax regulations that companies need to meet - such as compliance with Sarbanes Oxley. The best thing about this kind of solution is that by combining the needs of IT, accounting, helpdesk support, and operations departments you also have a combined budget with which to procure a far more powerful asset management system.

If you have any other solutions your company uses for asset tracking, I’d be interested to read your comments.

Small Business Advice accounting, asset management, asset register, asset tracking, barcode tracking, fixed assets, it assets, RFID, sarbanes oxley, sox

Coping with rising insurance premiums has become an increasingly serious issue for business both in the US and worldwide. The economic downturn of the past year or so in particular has brought this situation into sharp relief. Yet often overlooked is the fact that according to recent findings, as much as 70% of businesses are overinsuring their fixed assets!

The problem arises from a systemic lack of accurate and up to date information in the asset register, the database which keeps all the information on tangible assets. What ends up happening in this scenario is paying for insurance on fixed assets they don’t even own any longer. Another scenario is where the value of insured assets has depreciated to the extent where the insurance premiums could be lowered simply by calculating this asset depreciation.

This issue is compounded at the time of the insurance claim itself, when a lack of detailed information causes insurance companies to challenge or underpay on claims. This information includes detailed descriptions, serial numbers and proof of locations.Think of a similar parallel at home - if your house was burgled and you claimed on house insurance, imagine what the outcome would be if you failed to provide a reciept for your TV, computer and other items.

A lot of the time when an asset is replaced or thrown out, it is no longer seen as a problem by the financial people since its value on the company books has degraded to zero.What this means is that updating the asset database is not high on the to do list for many. The cost is merely put off, however, until such time as yo do need to make an insurance claim, at which point the lack of an up to date asset inventory will really cause you problems with your claim.

It probably wouldn’t come as much of a surprise to a lot of businesses to hear they dont have the best grasp of the state of their fixed assets. But I don’t feel many organizations know just how bad this is. Even less known is the extent of the savings that could be made from proper asset managment on insurance costs, and the gains in improving the success and outcomes of claims. A leading expert in fixed asset management software estimates that on average organizations are over-insuring by more than 20%. Surely that justifies some serious time and investment on making sure you have a decent asset tracking system in place.

Small Business Advice asset management, asset register, asset tracking, business insurance, business management, corporate insurance, fixed assets