Develop and maintain a physical asset register Develop

Develop and maintain a physical asset register Develop strategies for managing physical assets THHGGA 08 B Session 1 a 1

Objectives Today 1. Introduce outline for unit 2. Establish timelines for assessments 3. Develop Knowledge of assets 2

• At the end of this session you should be able to: – Identify and Explain non-current assets – Identify and develop an asset register – Develop strategies for managing physical assets 3

What are non-current assets • A non-current asset is an asset which is expected to be held for a period exceeding 12 months. There are 3 types of non-current assets: – Tangible Assets – Intangible Assets – Long Term Investments 4

Tangible Assets • Also called fixed assets, these are assets that can be seen and touched. Examples of fixed assets are: – Motor Vehicles – Plant & Equipment – Office Furniture & Equipment – Property 5

Intangible Assets • Are assets that have no physical existence; – – Goodwill Trademarks Copyrights Patents 6

Long Term Investments – Investments for a period in excess of 12 months. Eg, • • Shares in other companies Bonds & debenture Stock Preference Shares Government Bonds 7

What is an Asset Register An asset register is a register / book where all the fixed costs are recorded. The asset register will contain the following information: 8

Asset Register • • • Date of purchase for asset Description of asset Serial Number Asset number allocated by administration (usually incorporates 3 letters that identifies the department and the last 4 digits of the serial number) Date of end of life expectancy 9

Asset Register cont. . • • • Depreciation rate Total capital cost Annual depreciation amount Total depreciation expensed to date Written down value 10

Aligning the General Ledger & The Asset register • The general ledger and the asset register have to reconcile in the following: – Total of fixed assets in the general ledger has to balance to the total of the asset register Capital cost column. 11

Aligning the General Ledger & The Asset register – Total of accumulated depreciation in the general ledger has to balance to the Depreciation expensed to date column in the asset register. – Net written down value in the general ledger has to balance to the total of the net written down value column in the asset register. 12

Develop Strategies for managing physical assets • Strategies for managing physical assets must reflect the overall enterprise business and marketing objective. 13

Equipment Data Card • • Type of Plant or Equipment Its location Its energy source Its age Its condition Its forecast lifespan Warranty period – date of expiry 14

Equipment History Record • Logs inspections • Logs repair history • If out of warranty – Do you repair – Or replace • Logs maintenance requests 15

Repairs Regular Maintenance • Advantages – – Keeps equipment operating efficiently Reduces breakdowns Reduces energy consumption Increases life expectancy • Disadvantages – Equipment has to be shut-down for maintenance – A maintenance department must be kept – Spare parts have to be in stock 16

Exercise • Students to develop an asset register for a hospitality / tourism venue • Students to develop a plant / equipment card 17