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Fixed assets are the asset which cannot be liquidates into cash within one year.
The large amount of the company is invested in these assets. Every year the company
investment a additional fund in these assets directly or indirectly the survival and
other objectives of the company purely depends on operating performance of
management in effective utilization of their assets.
Firm has evaluate the performance of fixed assets with proportion of capital
employee on net assets turnover and other parameters which is helpful for evaluating
the performance of fixed assets.
The subject matter is limited to fixed assets it analysis and its performance but
not any other areas of accounting, corporate marketing and financial matters.
The selection of various fixed asset required creating the desired Production facilities
and the decision regards the extermination of the level of Fixed assets is primarily the
task that at the production technical people. The decision relating to fixed assets
involves huge funds a long period of time and are generally irreversible nature
affecting the long term profitability of a concern, an unsound invest decision may
prove to b total to the very existence of the organization. Thus, the management of
fixed asset is of vital importance to any organization.
1. Selection of most worthy projects from the different alternatives of fixed assets.
2. Arranging the requisite funds/capital for the same.
The first important consideration is to acquire only that amount of fixed assets,
which will be just sufficient to ensure smooth and efficient running of the business. In
some cases it may be economical to buy certain assets in a lot size. Another important
consideration to be kept in mind is possible increase in the demand of the firm’s
product needs the expansion of activities. Hence a firm should have that amount of
fixed assets, which could adjust to increase demand.
Another aspect of fixed assets management is that a firm must ensure buffer
stocks of certain essential equipments to ensure uninterrupted production in the events
of emergencies. Sometimes, there may some breakdown in some equipments or
services affecting the entire production. It is always better to have some alternative
arrangements to deal with such situations but at the same time the cost of carrying
such buffer stock should also be evaluated. Efforts should also be made to minimize
the level of buffer stock of fixed assets so that there will be maximum utilization
during that period.
The term asset management is often used to refer to the investment management of
collective investments, whilst the more generic fund management may refer to all
forms of institutional investment as well as investment management for private
investors. Investment managers who specialize in advisory or discretionary
management on behalf of (normally wealthy) private investors may often refer to their
services as wealth management or portfolio management often within the context of
so-called "private banking".
Investment management is a large and important global industry in its own right
responsible for caretaking of trillions of dollars, euros, pounds and yen. Coming under
the remit of financial services many of the world's largest companies are at least in
part investment managers and employ millions of staff and create billions in revenue.
Fund manager : It refers to both a firm that provides investment management services
and an individual(s) who directs 'fund management' decisions
Fixed asset : It also known as property, plant, and equipment (PP&E), is a term used
in accountancy for assets and property which cannot easily be converted into cash.
This can be compared with current assets such as cash or bank accounts, which are
described as liquid assets. In most cases, only tangible assets are referred to as fixed.
Fixed assets normally include items such as land and buildings, motor vehicles,
furniture, office equipment, computers, fixtures and fittings, and plant and machinery.
These often receive favorable tax treatment (depreciation allowance) over short-term
assets because they depreciate over time.
Assets Characteristics:
The transaction or event giving rise to the entity's right to, or control of, the
benefit has already occurred.