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Assets

The most important terms in time management

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What are assets?

Assets are anything available to meet commitments or offset debts and add financial value to a business or service. It may be money in the bank, investments, property or possessions.

Types of Assets

They can be categorised into short term or long term and are presented in balance sheet.

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Short Term or Current Assets

Generally speaking, they are expected to be used within a year.

Example:

  • cash and cash equivalents
  • outstanding invoices and short term debts
  • inventory stock
  • prepaid expenses

If it proves impossible to access a short-term asset, for example when a bill or debt isn’t paid the asset is recorded as written off.

Long Term or Fixed Assets

Some of your long-term assets, such as property, may be improved and increase in value while others will be subject to wear and tear which is recorded as depreciation.

Example:

  • Plant, machinery and office equipment
  • Buildings
  • Land
  • Fixtures and furniture
  • Software
  • Long-term investments such as stocks and bonds
  • Long term debts

Sometimes you may also have something called Intangible Assets. They do not have a physical presence but add value to your business and may include such things as trademarks, patents, logos, licences and customer goodwill.

Different accounting processes are used to measure these forms of assets although they are not always recorded. If, however, you have purchased an intangible asset such as a taxi licence or customer list or commissioned a company logo it will be recorded as adding value to your business.

A


Related words

Accounting System

What is an Accounting System? An accounting system is a system that is employed in a company to organize financial information. It can be either manual or computerized. The main reason why you should be using an accounting system is to keep track of expenses, income, and other activities.

A Accounting system Accounting year Balance sheet

Invoice

Invoice definition An invoice is an itemized “bill” of sale. It includes two parties: the issuer and the buyer. The issuer of the invoice is the “seller” of products or services.

I

Employee Time Tracking

What is employee time tracking? Employee time tracking is a function that is used to track the amount of time an employee spends on particular assigned tasks. Tasks usually fall under specific projects.

E

Commercial Invoice

What is a commercial invoice? If you run a small international business you’ve probably either received or had to issue a commercial invoice. Commercial invoices allow foreign trade and shipment to occur more seamlessly and easily.

C Commercial Invoice e-invoicing

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