Fixed assets are some of the most mismanaged company properties in the UAE. One mistake that many companies make is failing to provide clear records about their assets making it difficult for the authorities to evaluate the company and balance the fixed assets register accurately.
In the UAE, the International Financial Reporting Standards (IFRS) are responsible for setting the principles used to govern company assets, including fixed assets(stable holdings).
Fixed Assets Accounting Standards in the UAE
In the UAE, there are standards used to ensure proper management of stable holdings by accounting agencies. They include:
Records About the Acquisition, Maintenance, and Disposal of Fixed Assets
It is the responsibility of a stable holdings manager to track every stage of acquiring, maintaining, and disposing of a fixed asset. This includes the planning and budgeting process when the holding is disposed of.
The stable holdings Manager should, therefore, occasionally assess the stable holdings value to make it easier to work out its present value should there be any need to sell it shortly.
Occasional Physical Verification
Many companies in the UAE lose track of their stable holdings since no one pays attention to the old stuff once new ones have been brought in. While it may not directly impact the activities or output of your company, your business will be making losses if your holdings keep on disappearing.
There have been cases whereby items get lost in an office and remain undiscovered, or the discovery is made when it is too late.
By conducting an occasional physical verification, a stable holdings manager should be able to keep track of all fixed holding to prevent loss.
Review of Outdated or Fixed Assets Not Being Used
When a company purchases new computers, the old ones are often kept in a store and left to rot. A good stable holdings manager should be responsible for monitoring and handling such company assets.
Although most of the stable holdings that are no longer in use are meant to be disposed of or donated, it is according to fixed assets standards that these assets be documented to remain trackable in one way or another.
The worst that can ever happen to holdings that are not being used is to get lost without any trace.
Also read: How Accounting and Bookkeeping in UAE Can Help Business Owners
Restricting Some Assets From Moving
Some fixed company assets remain part of the company forever, maybe because they cannot be disposed of as it is customized equipment designed for a specific purpose. However, it reaches a time when these holdings become less important, and as a result, get mishandled.
There are cases where employees obtain company property without any clear procedures which is detrimental to the company.
What should happen under correct procedures is that the company holding should be passed on to the employee (now its custodian) and their details recorded in the company records.
In some cases, tracking devices are installed in stable holdings so as not to be disposed of illegally or moved outside a given area.
Also read: 10 Things to Consider When Choosing an Accounting Firm
Benefits of fixed Assets Registrar Services
One of the main reasons fixed holdings management services are important is that of reducing losses through theft, fraud, or conspiracy.
Additionally, it is excellent for keeping track of an asset’s value since fixed assets are known to depreciate with time.
Monitoring fixed assets can also be used to indicate if an asset needs to be replaced or undergo a maintenance procedure. Therefore, it is right to say that a stable holdings registrar can help you maintain the condition of your holdings.
In case of any repair or maintenance cost, all the information is recorded for accountability.
Consult With Best Accounting Firms Firms in Dubai, UAE
Farahat & Co is one of the top regulated Auditors in Dubai. With decades of experience under our belt, we can help you manage your stable holdings while following the IRFS rules.
Our experts will gladly manage your stable holdings so that there can be no loopholes in evaluating the true value of your company.
Feel free to call us today to inquire any auditing issue or even to book an initial appointment with us.
