The activity of any enterprise is in one way or another connected with accounting, the purpose of which is to record and present in a convenient form for analysis all the business operations of the enterprise and the formation of financial statements based on the processed data. Since the lion's share of the economic life of the enterprise is comprised of operations related to the acquisition, depreciation and write-off of fixed assets, it is absolutely necessary to explain the most important points regarding such a complex and responsible process as accounting for fixed assets at the enterprise.
The first and most important thing that a beginner (and not only) an accountant needs to know: fixed assets must be correctly and adequately evaluated. For this, it is necessary to fully and completely understand such a complex process as the valuation of fixed assets of an enterprise, because without a proper valuation of fixed assets it is impossible to conduct normal business activities. In order to correctly assess the cost of the OS, it is necessary to calculate not only their price, but also all the costs of their delivery, installation, preparation and commissioning costs.
Accounting for fixed assets at the enterprise also requires that the initial cost of fixed assets is estimated depending on the method of their receipt: for donated fixed assets it is fair (expert or market) value, for self-produced fixed assets it is the cost of production, for bought ones it is the purchase price. Therefore, in order to correctly assess the cost of fixed assets, it is necessary to clearly understand how they were acquired, and whether the company has ownership of fixed assets.
Analysis of the use of fixed assets of the enterprise also requires a careful approach to the calculation and accrual of depreciation on the assets of the enterprise.
There are such basic approaches to depreciation:
The straightforward method is a simple division of the depreciable cost by the number of years of using the asset and calculating, therefore, the size of the annual deduction. Accounting for fixed assets at an enterprise rarely involves the use of the straight-line method, since it is the simplest and it is impossible to use the accelerated depreciation method here.
The way to reduce the balance is to calculate the depreciation rate similarly to the straight-line method, however, multiplying it by an acceleration coefficient that cannot be more than three (these are the requirements of the accounting standards of our country). This method is used if, from year to year, the efficiency of use of equipment and other operating systems decreases.
The method of the sum of years is the depreciation accrual according to the cumulative coefficient calculated by dividing the number of remaining years of use of the machine, building or other fixed asset by the sum of all numbers representing the years of use of the facility. Thus, accelerated depreciation of the asset value is achieved, due to which the asset value is repelled in the shortest possible time. Accounting for fixed assets at an enterprise, especially when it comes to a large company that uses many objects of fixed assets, often involves the use of this particular method of calculating depreciation.
The last depreciation method is production. To calculate the amounts necessary for making depreciation deductions in this way, you need to calculate the percentage of production using this asset for each period, and use it as the depreciation rate for this period.
This depreciation method allows depreciation of equipment in accordance with its actual use, however, it is quite difficult to use, therefore, fixed assets are rarely accounted for at the enterprise using this depreciation method.