http://www.realassetmgt.com/blog/616/lifecycle-practices-controlling-fixed-assets/ Transforming Assets into Business Advantage Sat, 24 Jul 2010 21:13:52 -0600 http://wordpress.org/?v=2.8.4 hourly 1 http://www.realassetmgt.com/blog/616/lifecycle-practices-controlling-fixed-assets/comment-page-1/#comment-565 Joey Brannon Fri, 12 Feb 2010 06:13:12 +0000 http://www.realassetmgt.com/blog/?p=616#comment-565 I would add assessing asset impairment to the list. While some companies assign asset lives that are too short resulting in larger depreciation charges over the asset's life some other companies assign lives that are too long, thereby minimizing the depreciation charges hitting the income statement and overstating the amount of fixed assets on the balance sheet. In these cases it is necessary to assess whether the FMV of the asset is materially less than its carrying value on the books. If it is an adjustment may be necessary to recognize the impairment and fairly state the amount of assets on the balance sheet. I would add assessing asset impairment to the list. While some companies assign asset lives that are too short resulting in larger depreciation charges over the asset’s life some other companies assign lives that are too long, thereby minimizing the depreciation charges hitting the income statement and overstating the amount of fixed assets on the balance sheet. In these cases it is necessary to assess whether the FMV of the asset is materially less than its carrying value on the books. If it is an adjustment may be necessary to recognize the impairment and fairly state the amount of assets on the balance sheet.

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