2007 Review of Fixed Asset Systems

But
several programs are available now, generally database-driven systems with strong
calculation capabilities that greatly ease the entire asset management process,
from acquisition through disposal. For asset life events, the systems make it
easy to split, unsplit or combine assets, while also allowing revaluation, partial
and mass dispositions, and like-kind exchanges. Assets can also be grouped into
a business’ subsidiary units or by geographic location or cost center.
To comply with federal and state regulations, and to assist in accurate business
valuation, asset management systems also help maintain clear and accurate documentation
and audit trails, showing how assets have been depreciated and what methods
were used. But these are mostly organizational functions.

Determining the depreciation treatment that provides the best overall financial
benefit to the business, and that follows GAAP and FASB conventions, is the
“meat and potatoes” of asset management programs. And it’s
a complex process, especially considering that every taxing entity and other
parties allow and require different treatment of assets. To manage them differently,
asset management systems allow users to maintain multiple books for assets,
always including federal, book, AMT, ACE and state, and often also allowing
multiple customized books.

Programs also help the user select the appropriate classification for an asset,
including whether it is an asset of a farm, Indian Reservation, Indian Farm
or governmental entity, which have different allowances than regular assets.
After determining the class, these programs help with application of depreciation
methods, including MACRS and ACRS rules, Sum-of-the-Years’ Digits, Listed
Auto, Amortization, Straight-Line, Units of Production, Declining Balance and
eligibility of bonus depreciation under Section 179. For this review of asset
management programs, the following criteria were addressed:

• Navigation/Ease-of-Use. This is critical to any software
  program, but especially for those dealing with functions as complex as asset
  management.
• Management Features. Here we address the books and depreciation
  methods supported by each of the programs, examine how the system performs
  general functions and discuss additional productivity-enhancing features within
  each system.
• Integration. Fixed asset depreciation management may not
  be only a tax function, but it can be an important part of the reporting process
  for many entities. Many advanced systems offer integration with professional
  tax preparation packages, as well as with GL and write-up programs, allowing
  users to easily transfer data between these various systems without manual
  re-entry or complex processes.
• Reporting. Government entities want forms and worksheets,
  accountants need journal summaries, and clients benefit from knowing what
  their business’ assets are worth to them … and when/how they can
  plan for disposition and replacement. Therefore, asset management programs
  provide various output options like PDF and export to Excel, while some of
  the programs in this review even offer fileable versions of federal and state
  forms.
• Help/Support. The Help and assistance features within a
  program are crucial. And additional resources such as online support centers
  can greatly ease new users as they transition into a new program, as well
  as benefit other users looking for guidance on specific functions. This section
  also identifies whether tech support is included with a system’s pricing
  or requires additional charges.
• Summary. This final section gives an overview of each of
  the programs’ primary features and strongest functionality areas, and
  it identifies the types of users most likely to benefit from the system.

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