The asset register of your organisation is important to have and maintain yet a lot of organisations fail to have one or, if they do have one, it is often not kept up to date. Whether you are a board member or a treasurer do you know what assets your organisation has, where they are located and the condition they are in? If not, then you need to address this immediately.  Even if you do you know the answers, you should satisfy yourself that the register is accurate and up to date.

Even Robin Hood would have needed an asset register of sorts.  How else could he track his equipment, who had it and whether it was usable?

The asset register is needed for several reasons and these include the need to simply track the purchase of assets that are shown in your financial reports as well as the depreciation. Often these are shown on the balance sheet as a non-current asset such as furniture, fittings and equipment or a similar category.

When assets have been included on the finance reports it is because the organisation has deemed that when the purchase of the item is above a certain amount then it is an asset for accounting purposes. For example, some organisations may have a threshold of $500 and other organisations may have a higher or even lower. Usually your organisation will have a purchasing or assets policy that will state the amount. As part of your review determine whether the amount needs to change. In addition, some organisations that provide grants may state as part of the funding agreement the amount for recording the asset so ensure you comply with these requirements.

Another reasons for an asset register is for both security and insurance purposes. (Robin Hood might have had a little trouble with this bit!)  So, in addition to the assets detailed above which are included for accounting purposes, you can record other equipment such as tools, mobile phones, printers or any other item that are worth tracking. This then makes it easier to ensure you have adequate insurance cover as well as being able to identify an item that may have been broken, stolen or misplaced.

Furthermore, if you have a properly maintained asset register then this makes it easier to plan when they need to be replaced  and that can be incorporated into your Capital Budget.

The next post will look at what information you should record on your asset register