Accounting and analysis of the use of fixed assets of the enterprise

Any businessman faced with a problem when his business car starts to lose momentum and require additional capital investment. At this point, the owner of the enterprise faces a choice - to listen to his production specialists and to urgently purchase new equipment, equipment, and build the premises? Or should one heed the advice of meticulous financiers and, first of all, make an analysis of the use of fixed assets, which will clearly show the need for additional capital investments?

The fixed assets (funds) of an enterprise or organization are tangible assets involved in the production process that have a service life of more than one year, while retaining their physical form. In accounting, these capital investments are paid at the initial cost and during the life of their operation, their value is written off in parts to the cost of production through depreciation.

The fixed assets of enterprises and organizations are subdivided into production, which directly participate in the creation of production costs, and non-productive - do not participate in production, but have important, for example, social significance.

Accounting and analysis of fixed assets allow you to make a description of the activities of the enterprise for the following indicators:

• Provision of the enterprise and its departments with the main production and non-productive funds;
• Level of use by the enterprise of production and non-productive fixed assets using private and generalized indicators;
• The dynamics of changes in fixed assets and the identification of its causes;
• Efficiency, profitability, share in the cost of production, and other indicators of the economic efficiency of capital investments.

In order to analyze the use of fixed assets, you need to collect information from the following reporting sources of the enterprise:

• Balance of execution of the estimate of expenses;
• Reports on the movement of fixed assets;
• Inventory list;
• Certificates of cancellation;
• Cost estimates;
• Accounting cards and inventory lists of fixed assets;
• Technical passports;
• Materials of inspections and audits.

Analysis of the use of fixed assets of enterprises and organizations is based on the calculation of indicators characterizing their structure, level, dynamics of change, as well as intensity of use:

• The average annual value of fixed assets - shows the level and dynamics of the provision of an organization or enterprise with fixed assets.
• The wear factor is a generalizing indicator, calculated by dividing the amount of depreciation by the original value.
• The expiry factor - reflects the condition of the means, suitable for operation.
• Refresh rate - shows the intensity of the receipt of capital investments.
• The retirement ratio reflects the intensity of the retirement of funds.
• Capital productivity. This indicator reflects the efficiency of the use of capital investments and is calculated by dividing the volume of commodity output (profits, revenues) by the average annual value of fixed assets.
• Equity ratio - characterizes the security of the personnel of a given organization or enterprise by fixed assets.
• The degree of intensity of the use of the company's capital capacity is characterized by the calculation of the coefficients of intensive, extensive and integral loading.

Separately it is necessary to say about non-productive funds, which play their important role, connected with improvement of well-being of the personnel of the enterprise. Additional investments in the construction and arrangement of kindergartens, hospitals, residential buildings, stadiums have a positive impact on the material and cultural level of the workers' lives, which ultimately has a positive effect on the growth rates of labor productivity, lower production costs and financial results of the enterprise.

The analysis of the basic economic indicators allows to solve problems of definition of degree of efficiency and intensity of use of cars and the equipment, provision with premises, vehicles and other capacities of the enterprise. On the other hand, the analysis of the use of fixed assets of enterprises and organizations makes it possible to identify hidden reserves for increasing the efficiency of the use of funds, to outline appropriate measures to improve the state and security, to assess the correctness and validity of the write-off of facilities, and to determine the appropriateness of further additional investments.