Value Connection Services Ltd is a fixed asset consulting and supplying company which was incorporated in 2013. We have prepared this proposal to highlight to you our capabilities, experience, methodology and professional staff profile. Our service offering is aimed at assisting you put in place best practice fixed assets management processes structures and policies. The reconciliation exercise will ensure the values you are carrying in your books do tie up with what is on the ground. This is fundamental in compliance, reporting and corporate governance. Our team at Value Connection Services Ltd is highly experienced in this specialized professional service. We look forward to delivering value and return on investment.
The overall objective of the exercise is to ensure that there is a proper and efficient fixed assets control policy at your organization/company.
The exercise will involve;
We have prepared the table below to state our specific response to various deliverables we offer to cover the entire scope of work;
| Your Requirements | Our Response |
|---|---|
| 1. Supply of high quality and longlasting barcoded asset tags. | Aluminium Bar code labels The tags we will supply are extremely durable anodized aluminium tags with a sub-surface photographic image that provides years of dependable service in the most demanding environments. The tag image is sealed within the surface of the metal, creating durability and resistance to heat, cold, chemicals, impact and abrasion. We will supply tags which are Anodized aluminium bar code with company/organization logo, Alphanumeric code, and Code is readable by scanner The tag we will provide will be able to stick permanently in all kind of surfaces like plastics, metals, woods and glasses. |
| 2. Asset Verification, tagging and Fixed Assets Register Development | We shall perform a comprehensive asset inventory by labelling all assets using bar code label following our well tested methodology. We will also undertake data fortification - adding valuable attribute information such as .Asset number, description, make, model, serial number, year of manufacture(Y.O.M),Asset class/categories, department, location and custodian each data record, attaining accuracy in the completeness of your fixed assets data. This will ensure that fixed asset reporting provides management with accurate assessments of the fixed asset picture across and ensures better compliance with regulatory requirements. Our professional service delivery leverages our expertise and experience in useful related areas such as accounting and tax. |
| 3. Fixed Asset Register Reconciliations. (optional) | We will conduct reconciliation of assets tagged in the newly developed FAR to your fixed asset ledger or existing FAR; We call this process Floor-to-book reconciliation. We have developed expertise in carrying out this exercise over the years. The reconciliation exercise ensures your physical inventory matches your financial reports for assets that records exist in your current register. During this stage we shall allocate every individual asset to its purchase cost and date. We shall work hand in hand with the company/organization management/finance department to make sure everything balances with whatever is in the books of account. The final reconciled FAR will be adopted and uploaded to the new ERP for reporting purposes. |
| 4. Identification of Obsolete assets | As will verify all the assets in all locations, and identify all assets beyond repair/obsolete. We will not tag the obsolete assets but we will give a list of them with their custodians and locations. |
In the world of accounting, the savings potential of improved fixed asset management is often overlooked. It’s difficult to find time and tools to devote the attention of fixed assets that they deserve yet assets like land, building, transportation and manufacturing equipment represent the largest investments most firms undertake. Sound fixed and inventory management can yield substantial tax savings in depreciation deductions. Conversely, sub-optimal fixed asset practices can threaten the accuracy of financial reports and impact negatively your bottom line. Establishing the highest standards of depreciation accuracy and best practices in fixed asset management will pay off.
Our proposed offering will help company/organization establish an inventory/asset system that will label, manage and track all assets. These best practices will help you seek out potential savings in your fixed asset base and inventory management and bring about savings in time and resource utilization.
• Establishing an accurate baseline of fixed assets and inventory
• Preparation of comprehensive asset registers with values and software roll out.
In this proposal, we have set the value proposition of our service, our understanding of your environment, our methodology of project execution that will ensure successful project delivery and our profile that includes who we are, our experience and the team.
There is nothing more critical to effective management of fixed assets than beginning with an accurate fixed asset inventory. Without it, no amount of added processes, controls, or correct calculations can ensure the accuracy of fixed asset accounting. The only reliable way to verify and validate the fixed asset information is to conduct a physical inventory
A “ghost” asset is property that is lost, stolen, or unusable, but is still listed as an active fixed asset in the system. Ghost assets that are not identified can cause lost productivity because missing or unusable assets are not available when needed. Capital budgets are rendered inadequate because
management is unaware of critical assets needing replacement. According to Asset Management Resources, a leading provider of asset inventory and reconciliation services, on average, 65% of fixed asset data is incomplete, inaccurate, or altogether missing, while 10% to 30% of Fixed Assets are no
longer owned”
If 10 – 30% of Fixed Assets on the books are ghost assets, you are most likely overpaying your insurance premium on those assets by up to 30%. In addition to this negative impact to the bottomline, there is a risk in accuracy of fixed asset reporting overall accuracy of corporate financials,
posing a threat to regulatory compliance.
Our wall-to-wall asset verification and tagging using the latest technology will clear the problem of ghost assets and establish a clean register.
Insurance Premium Savings
If assets that are no longer in service are not properly disposed of in accounting records, it is highly likely that you have been paying insurance on them. Companies are, on average, overpaying insurance on approximately 12% of the Fixed Assets on the books. Even mistakes in the amount of depreciation calculated can result in overpayment as insurance premiums are usually based on a percentage of the total current value of Fixed Assets.
As you consider our service offering, it’s helpful to determine the return-on-investment that optimised fixed asset management would provide your company. To calculate ROI, you’ll look at the total value of your fixed assets and estimate the amount disposed/lost assets on your books. The average for most companies is about twelve percent. Then, based on your insurance rates, calculate the value of overpayments on insurance for
your ghost assets. Compare this annual expenditure to the cost of this service and for the fixed asset management system
