Many finance systems contain an in-built fixed asset module that usually covers the bare minimum when it comes to fixed asset accounting. These rigid solutions often leave the user with numerous manual tasks to complete in order to ensure that fixed assets are accounted for correctly.
If you are struggling with your incumbent fixed asset module and require further justification on the benefits of moving from the standard option within your finance system, read on to discover why a specialist solution is the more affordable, flexible and reliable choice in the long term.
Whilst there are advantages and disadvantages to both options, and, indeed, the ultimate decision will depend on the overall objectives of your business, there are certainly a number of proven benefits in selecting a dedicated fixed asset system, as outlined below.
Simple and affordable implementation
Installing, configuring and updating a finance system is a massive task – it is expensive and takes considerable time. Consultation fees for set up and modification are often cost prohibitive whereas the design of best of breed fixed asset solutions are much more agile to suit a range of organisation sizes and budgets. Specialist fixed asset software suppliers can offer finance teams additional flexibility tailored to meet individual requirements and requests as they are not tied to a strict development roadmap.
Most fixed asset modules take their structure from the finance system’s core data and configuration which makes it very difficult for users to dictate the data attributes etc. that need to be populated. A dedicated solution on the other hand can accommodate current working practices without having to adjust corporate procedures due to software limitations.
In-depth fixed asset functionality
Generally, the fixed asset option is bolted on to the wider finance system and often isn’t considered a core business function by the organisation supporting it. It may provide basic asset management capabilities but is unlikely to offer the specialist functionality truly required to ensure cost and time efficiencies as well as accountability and corporate governance compliance. Examples of more specialist FA features include:
- Batch event handling – the ability to perform batch transfers and disposals etc is often a big time saver for finance users.
- Information granularity – the flexibility to decide the level of detail captured at asset level and the ability to transfer assets to different parts of the company or depreciate individual items differently within a group.
- Detailed financial reporting – access to a more comprehensive selection of both standard and customised fixed asset reports.
- Data import/export – the ability to import mass additions or revaluations from an external source such as MS Excel.
- Centralised asset register - the ability to provide one central asset register across a group that may have multiple finance systems (often specific to the site or country).
- Lease accounting and capital projects – the facility to manage the complete lifecycle of assets including the control of finance and operating leases and the management of assets under construction.
Sector specific functionality
Add-on modules are usually designed by the finance system author to fit with its core module demands, which typically do not meet specific market sector requirements. As a result, users often find that new functionality relies on lengthy wait times and expensive system upgrades due to rigid development schedules. A specialist provider however, will be heavily focused on ensuring its core development priority is sector specific accounting compliance. It will be able to react quickly enough and provide the necessary specialist functionality to assist its customers in dealing with the changing nature of accounting code and audit compliance.
Technical support provided by finance system providers is typically across the board with representatives covering all modules within the system. This naturally limits the level of expertise and knowledge provided for the smaller modules such as fixed assets. The technical support team for a dedicated fixed asset supplier however, is trained purely in dealing with the intricacies of its product and is able to provide speedy responses and resolutions to all issues.
When making the decision to purchase a software solution, it is important to consider not only the short term objectives and requirements of the business, but also the longer term ones in order to ensure a protected investment and one which will serve you well into the future.
So whilst the opportunity of using the fixed asset module within your finance system may on the surface have seemed an attractive, cost effective and easy option, it may be time to reconsider your selection and take action......
For more information on how a specialist fixed asset management system that can still integrate with your finance system could benefit your business, please email Real Asset Management at email@example.com or call on +44 (0)1689 892 100.