Asset tagging is the process of labeling commercial business assets to more efficiently and accurately identify them for financial reporting, location tracking, maintenance management, and loss prevention.
Once the initial tagging process is complete, property owners can take an inventory of the assets using a scan gun, producing various reports accessible by computer or mobile device.
When the manufacturer’s serial plate is no longer legible
Machinery and equipment appraisers often deal with reconciliation issues when serial number plates become scratched, worn, faded, or otherwise illegible. Reconciling the asset to the owner-provided asset list can be time-consuming, costing the client more billable hours. Likewise, when a company experiences a management change, the knowledge of that old heap of metal goes with the last manager responsible for it. Identification tagging can store the asset’s data for years to come.
Asset ID tags come in various types to fit the needs of the company. Metallic stickers, UID, foil, rigid metal, polyester, tamper-evident, removable, and other materials are available. Be sure to order the tag that will work for your purpose, considering factors such as how frequent the property moves (damaging or scratching the tag), whether theft deterrence is an issue, and the environment in which the equipment is used (greasy, heat applications, etc). Whether using a barcode label or QR code, be sure it integrates with the scanning device and tracking software that you’ll be using.
Numerous benefits for tracking assets
Perhaps the main benefit of asset labeling is the increased efficiency in fixed asset and inventory management. Companies can track physical assets with a simple scanning device or automate their inventory control system.
Vital to inventory management applications, asset tagging ensures records are up-to-date and accurate. Spot-check inventory variances with ease. The software allows you to check on the status of an item and schedule product replenishment.
- Maintain a database of fixed assets and inventory
- Tracks movement of commercial assets or inventory
- Improved efficiency and accuracy over traditional reconciliation methods
- Tangible Personal Property Tax filing and tax appeals
- Financial accounting
- Theft deterrence and recovery
- Preventative maintenance tracking
- Track employee-issued company assets
- Asset replacement scheduling
Managing the data
Asset tracking software options are available to match the company’s data management needs. Data input for each asset can contain property identification fields such as year, type, make, model, and serial number. Or companies can make the reporting more useful for other functions by including additional inputs of whom the asset was issued to, when it is scheduled for maintenance, and the original cost.
- Classification, category
- Process line
- Type, subtype
- Serial Number
- Usage (hours, miles, cycles)
- Who checked it out and when
- Return due date
- Last maintenance performed
- Cost when purchased
This inventory of assets is vital for many departments and third parties. Accounting and tax departments use asset tracking software for accurate financial reporting, tax filing, and depreciation schedules.
- Financial department
- Equipment managers
- Tax department
Tangible Personal Property Tax Filing
Your tax department will love this method of tracking fixed assets. They will be able to report disposals and additions with ease. No more paying taxes for “ghost” assets that were disposed of years ago. An accurate, consistent system will save not only your employees’ time, but the company will realize tax savings year after year.
Which assets should be tagged?
For machinery and FF&E (furniture, fixtures, and equipment), companies typically choose a minimum value threshold for applying asset tagging. Tagging is especially important for tracking mobile assets, such as laptops and tools that are issued to employees or contractors.
For inventory, asset tags can be applied to the storage location, rather than the inventory item. As soon as an asset is purchased or an inventory item is received, it should be tagged and scanned into the system before being used, checked-out to an employee, or sold so that the company maintains consistency in reporting.
Save time and money. Let us help!
If you are already ordering a machinery and equipment appraisal, why not have the appraiser include asset tagging with their machinery and equipment inspection? Appraisers are experienced at properly identifying tangible assets and reconciling them to your asset list. Recruiting the appraiser to verify assets’ identity and apply new or replacement tags while performing the initial asset inspection can save your company thousands of dollars.
If performed with care and accuracy, asset tagging can be a time consuming, labor-intensive project. Outsourcing this task to For What It’s Worth Appraisals, Inc is an excellent way to save yourself time, while confidently managing your tangible assets. We can also perform asset list reconciliation to help you remove “ghost” assets on your Tangible Personal Property tax filing. Contact us today.
About the Author
Tammy Blackburn, ASA is an Accredited Senior Appraiser with over 15 years of experience performing Machinery & Equipment appraisals and Inventory valuations. As an expert witness, Ms. Blackburn has defended her appraisals in Federal bankruptcy court and in Value Adjustment Board hearings. Having served 7 years as a Special Magistrate in 10 counties for ad valorem Tangible Personal Property, Ms. Blackburn is uniquely qualified to perform appraisals to be used for establishing taxable value.