Ghost and Zombie Assets – Now That’s Scary Stuff!

Fixed asset accounting software can help you avoid two “terrors” of the accounting department—ghost and zombie assets. No, you won’t need to call the Ghostbusters to get rid of these assets. All you need is the right accounting software to find and properly account for the depreciation. Here’s how.

Missing Assets Create Ghosts and Zombies

Whoever named ghost and zombie assets had a sense of humor. Ghost assets are those that show up on the balance sheet but can’t be physically located anywhere within the business. They’re “haunting” your balance sheet with their incorporeal presence.

Zombies, on the other hand, are like the walking dead … they have a physical presence but aren’t accounted for on the balance sheet.

What causes ghosts and zombies? Typically, it’s a mistake accounting for fixed assets. And that mistake carries a frightening price tag. The financial implications of missing assets or not accounting for fixed assets can be grim.

  • Ghost assets can lead to false decreases in tax liability. They can also open your company up to compliance standard violations.
  • Zombie assets can fool companies into overpaying for property taxes and insurance.

Many companies track fixed assets using pen and paper or spreadsheets, but both methods have significant drawbacks and can lead to ghosts and zombies. Fixed asset accounting software can make both errors a thing of the past.

3 Ways in Which Fixed Assets Accounting Software Prevents Costly Errors

Fixed asset accounting software such as Sage Fixed Assets provides a fixed asset depreciation for financial and accounting reporting. With this software in place, you can use several techniques to prevent costly accounting errors related to fixed assets.

  1. Take an accurate inventory of fixed assets: Taking an accurate inventory of your business’ fixed assets can be time-consuming. And, if you have multiple locations, ensuring the same method is used at every location to take inventory can be challenging, too. Fixed asset accounting software offers built-in quality and accuracy checks to help ensure the fixed asset counts are done correctly. All team members can access fixed asset counts through Sage and use the data as needed for accurate, timely reports.
  2. Asset tagging: Tagging fixed assets with a unique, scannable bar code solves multiple problems. First, it makes it much easier to log such fixed assets into inventory. Swipe, scan, and done—your system is updated. But there’s an even more important reason why using unique asset tagging benefits fixed asset inventory. If your company owns several nearly identical items, using tags on fixed assets ensures the correct ones are logged into inventory, sent for repairs or maintenance, or retired from service and disposed of properly.
  3. Correct depreciation of fixed assets: By tracking items, you can also use fixed assets accounting software to provide accurate and correct depreciation. The software enables you to track disposals, materials, labor, location, transfers, and other information vital to accurate accounting. Best of all, such tracking can be automated, which is a huge time-saver for the accounting department. The information in Sage Fixed Assets flows seamlessly into Sage ERP and provides information and reports with higher accuracy than scratch counts or spreadsheet tallies of fixed assets. Depreciation schedules can be viewed and checked by the accounting and finance departments and all departments can see equipment aging data and other information necessary to their tasks.

Such software offers other benefits, too. Better workflow integration and project management are additional added values that fixed assets accounting software can add to your business. Make ghosts and zombies the myths they’re meant to be once you put Sage Fixed Assets in place.

Sage Fixed Assets Accounting Software: It’s Time for Sage

Sage Fixed Assets accounting software can help everyone in the company with better information. Year-end financial reporting will be easier (and accurate) with the right software. Manage capital budgeting and improvement projects with ease. It’s just a few of the reasons why businesses love Sage Fixed Assets to help them manage valuable equipment and assets.

For more information on Sage products, connect with Emerald TC. Contact us or call 678-456-6919 for more information.

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