Keeping a fixed asset register

A fixed asset register links the accounting balance to identifiable assets. Record the asset description, acquisition details, cost, location and relevant depreciation information. The register should explain movements during the year and support checks that assets still exist and remain in use.

Review additions, disposals, damage and changes in expected use. Keep evidence for proceeds and removal from the register. An old laptop should not remain indefinitely simply because nobody told the bookkeeper it had been replaced, while an asset used by a director still needs a clear company record.

Give each asset an identifiable record

Use a reference linking the asset to its invoice, description and ledger entry. Include serial number or another practical identifier where useful, together with location and responsible person. A register entry called computer equipment may be too broad to reconcile when several devices are replaced at different times. The level of detail should let someone identify the actual item without relying on the purchaser's memory.

Record acquisition date, relevant cost components and the accounting policy applied. Preserve ownership and finance evidence separately from the physical location. GOV.UK's company record guidance includes assets within the information the company must maintain. ^[1] The register supports that requirement by explaining the balance and movements rather than merely reproducing one total from the trial balance.

Reconcile additions and the opening position

Begin with the previous closing register and confirm agreement to approved accounts and posted adjustments. Add purchases from invoices and relevant project records, not just bank payments. Equipment bought on credit or introduced through another arrangement may not appear as a current cash outflow. Check that an item is not recorded twice through both an invoice import and a manual year-end adjustment.

Separate assets under construction or awaiting installation where the accounting treatment requires it. Identify maintenance or consumables incorrectly included in capital additions and refer uncertain classifications to the accountant. The guide to Accounting for company equipment addresses equipment acquisition and use. Keep a clear explanation of corrections so the next year's opening balance does not recreate the same classification error.

Track depreciation and changes in expectations

Record useful life, residual value and depreciation method where relevant under the applicable framework. Reconcile accumulated depreciation and the period charge to the ledger. FRC standards provide the reporting framework for these decisions. ^[2] Do not apply a default software rate indefinitely without checking whether it reflects the company's policy and the asset's expected use.

Ask operational staff about damage, obsolescence and changes in utilisation. A fully functioning item may still be economically obsolete, while an asset with a low accounting value may remain important to the business. Keep the accounting valuation distinct from insurance replacement cost and market sale value. Those figures answer different questions and should not be substituted for one another without appropriate assessment.

Record disposals and verify existence

Use a disposal record showing the item, date, proceeds or scrapping evidence, approval and any connected party. Remove the relevant cost and accumulated depreciation through the appropriate accounting process. Do not simply delete the row, as that loses the history needed to explain the movement and any gain or loss. Review related tax consequences separately.

Perform a proportionate physical or operational check and investigate missing items. For remote equipment, confirm the holder and location through a controlled process. An asset list can also help with access and secure disposal, especially where devices contain client information. Use Deleting customer information securely for deletion considerations before equipment leaves the company's control, rather than assuming removal from the accounting register clears stored data.

For Annual accounts preparation support, supply the current register, ledger balances and additions or disposals documents. Ask for reconciliation of opening cost, movements, depreciation and closing carrying amounts. Assign an operational owner to report changes throughout the year. A useful register supports accounts preparation, insurance discussions and business handover while retaining a clear distinction between ownership evidence, physical control and accounting value.

Record equipment that moves between locations

When a laptop or machine moves to another branch, update its location and responsible custodian without treating the move as a disposal. Keep the asset identifier consistent so the register, insurance schedule and physical check refer to the same item. Record equipment held by remote workers or temporarily with a repair provider.

During a physical review, investigate assets that cannot be located and items in use that do not appear on the register. The cause may be a missed addition, an undocumented disposal or an incorrect location. Resolve the evidence before changing the accounts. This practical check helps distinguish an outdated register from a genuine loss and makes later replacement and disposal decisions easier to support.

Illustrative scenario

A business replaces several computers but continues depreciating the old machines because the register was not updated. A physical and ownership review identifies which items were sold, scrapped or retained. The accountant records supported disposals and considers any separate tax consequences.

Preparation checklist

• Use a stable identifier for each material asset.
• Link cost and ownership to source documents.
• Review location, condition and continuing use periodically.
• Record disposals and reconcile the register to the ledger.