Fixed asset valuation – an independent valuation company service to determine the market value of various types of assets. Reflection in accounting and tax accounting it is the market (fair or valid) cost of equipment is necessary for enterprises as a private, as a public form of ownership quite often. That is why we dedicated a separate article on our site to carrying out this type of work.
As there are many features involved in the fixed asset valuation, in case if you have any questions, you can contact with us, to get advice about your case. But if you want to understand the subject by yourself and more deeply, we recommend reading this article.
How the price of fixed asset valuation forms.
The specifics of the negotiations on the assessment of fixed assets (as well as the valuation of property in general, without specifying its type) is that it is not at all clear at the outset how much work is involved. To understand this volume we need to see and analyze the list of fixed assets that are to be evaluated.
One of the most common questions from new customers is the question of the average price of a service or the price of the valuation of fixed assets per unit. Unfortunately, the pricing principle when evaluating equipment is quite complex and primarily based on a number of other factors rather than the number of items on the list. The cost of the service itself depends more on how each item of the list is the standard (common). That is, for example, to appreciate 20 different, but standard office chairs are much easier than one stand for flowers made by hand. In addition, the assets of an enterprise often include not very common equipment (or even custom-made equipment), the valuation of which can often be effectively separated into a separate task.
Another apparently paradoxical feature of the pricing of valuation of fixed assets is that the older the equipment and the worse the condition, the more difficult it is to evaluate in most cases. At the same time, even if you need to evaluate some (sorry for the expression) junk, the appraiser still has to explain why he has one penny, and not, for example, four of the same penny. And conversely, it is much easier to evaluate any new expensive server than any old computer, all the analogues of which are long gone.
The property to be evaluated should have the following characteristics:
- Name of fixed asset (model). It is very often the case that in accounting, the title of the fixed asset does not contain information about the model or characteristics of the asset. If this is the case, we will analyze the list and send clarification questions on a number of items where there is not enough information to determine the cost of the fixed asset.
- Original price. Cost of acquisition of property helps appraisers correctly identify an object and in some cases is the basis for determining its present value.
- Date of entry into service . To evaluate, it is important to include this column list-job, as the original cost per se without reference to the balance date is not sufficient!
However, you should pay attention on fact that in not all cases the original cost is known in advance. Often the purpose of the procedure is to determine the fair value of the asset precisely for the subsequent calculation of original cost. Such a situation in particular arises when exchanging fixed assets, receiving them free of charge or when the property is deposited into the statutory fund by the founders. For more information on such situations, see this link.
Additional factors, which affect on the cost and time of evaluation of fixed assets.
Another factor (besides the list of fixed assets), which has impact on the cost of work is what you need to evaluate and what kind of cost you need to determine. The impact of the work objective on the costing procedure can be found at this page “property valuation”. In most cases, the fixed asset valuation is needed for:
- registering in balance of the enterprise;
- sale of fixed assets;
- write-off (the feature of the valuation when writing-off fixed assets (as opposed to valuing them for sale)) is that the equipment is usually obsolete or defective;
- pawning;
- insurance;
- revaluation of properties for International Financial Reporting Standards (You can get detailed information in the appropriate section of our website).
As with all types of expert evaluation the mansion is the case when the property belongs to a state enterprise. A feature of such work lies in the fact that in some cases the procedure is subject to some additional requirements, which in each case are individual.
Fixed Asset Valuation in Kyiv
We are often asked by the accountant of enterprises to provide advice on the valuation of fixed assets in Kyiv. This service is often required for the sale of assets, for leasing, and for write-off. The feature of this type of work is that the concept of «fixed assets» includes a wide range of diverse property. This is a key feature of the valuation of fixed assets as approaches to identifying different types of assets also vary.
Real estate valuation in fixed assets.
Many enterprises in Kyiv have real estate on their balance, which is rented out. Such property is often included in the fixed assets of the enterprise, because it generates income and is an important and usually the main and most expensive asset(s).
To determine the value of real estate we need to have on our hands the following documents (all in regular copies or scans):
- The right establishing the document: contract of sale, an extract, court decision, etc.
- BTI technical passport: if the technical passport contains large sheets (A3 or even A2) with plans of the premises, they can not be provided (at the initial stage). For appraisers the most important sections of technical passports are the «evaluation act» and «explications».
Questions about conducting appraisal of real estate have a lot of materials on our site, so we will not go into details in this article. Let us indicate only that the approximate value of real estate we advise to determine, based on these specialized sites (bulletin boards). When choosing objects for comparison you need to pay attention on the type of real estate, location (in Kyiv necessarily the same or neighboring microdistrict), total area, floors.
Evaluation of furniture and computer equipment as part of enterprise assets.
In most cases, the largest number of items on the list of fixed assets was furniture and computer equipment. A simple list indicating the name, historical cost and date of incorporation of each asset is sufficient to determine the value of such assets.
Also draw your attention to asset names while creating an assessment list. Often in accounting such names contain only an indication of the type of equipment, for example, «printer». We also need to know the model for calculations. Therefore, if you do not specify a model, you need to create an additional column in the list where you specify this information.
Valuation of complex equipment and production lines.
If an enterprise’s assets include complex machines or production lines, the valuation of fixed assets of this type is much more difficult than just the determination of the cost of computer equipment and furniture, but compared to real estate valuation. With such equipment we need to know not only the manufacturer and model, but also in the case of non-extended specific equipment the technical parameters of the machine or line.
No matter what types of assets you have on your balance sheet, at the initial stage we expect a list of your fixed assets. After receiving such a list, we will be able to determine the amount of work and offer you the most advantageous terms of cooperation – the cost of our services and the term of their provision. Most often we evaluate the fixed assets in Kyiv, because here is located our office. However, we have the possibility to do work online, so we will be glad to cooperate with companies in other areas. Welcome!
Revaluation of Fixed Assets in Ukraine
The task of re-evaluation of fixed assets in modern conditions is always relevant for modern enterprises. Regular updating of the book value of fixed assets is not only a requirement of the International Financial Reporting Standards, but also enables the management of a modern company to make informed and timely management decisions regarding, for example, the sale of some assets or, conversely, the purchase of new ones. Another of the most common purposes of this work is to determine the market value of the property of the enterprise for insurance purposes.
Often, when large international companies re-evaluate fixed assets, market value findings are agreed with audit firms. Subsequently results of the work of appraiser about determining the value of fixed assets become an integral part of the auditor’s report. It is important that the appraisal company has had experience in harmonizing its reports with audit firms, which often impose requirements based on International Evaluation Standards. The most authoritative audit firms, as you know, are the companies in the so-called “big four”: PricewaterhouseCoopers, Deloitte, Ernst & Young, KPMG. We have experience in coordinating our evaluation reports with representatives of all these companies. When choosing an appraisal company to revaluate its fixed assets, it is important to familiarize yourself with its portfolio (list of regular customers). In our opinion, the main capital of any appraisal, and not only appraisal, firm are its employees and customers. The list of well-known companies with which we have had the pleasure to cooperate is given in the section “Our customers“.
How much costs the revaluation of fixed assets and what documents are needed for its implementation
The main source document for the revaluation of property, plant and equipment is the list of assets with the name of each item, its historical cost and the date of commissioning. Normally, such a list is in the form of an additional agreement to the contract for evaluation. As a rule, the fixed assets of a large enterprise comprise different groups of assets, which imply very different approaches to determining their value. Below you can find the most common types of fixed assets with the necessary input for their expert evaluation:
- Appraisal of real estate – the ownership documents and technical passports.
- Vehicle evaluation – vehicle registration certificates and mileage data.
- Valuation of equipments – some complex equipment, such as production lines, require technical documentation or specifications, such as performance.
As a result of the revaluation of fixed assets appraiser faces the need establishing the value of the property of different types, the cost of our work and the period of its completion are determined based on a specific evaluation task. A feature of pricing in this case is that the determining factor in the pricing of this service is not the number of items in the list for evaluation, but their “quality”. For example, it is much easier to estimate 10 modern computers than one production line.
In order for us to be able to make you a commercial offer, please send us a list of the property by e-mail. We will analyze the information and try to offer the most advantageous terms of cooperation, a favorable price and an adequate period of evaluation.
You are welcome to contact with us!
Why us?
We as a appraisal company, which has been operating in the market for many years, we have gained quite a lot of experience in evaluating fixed assets of varying complexity: starting from small businesses (as a rule, computer equipment and furniture) and ending with the evaluation of large production complexes (appraisal of real estate, vehicle evaluation, valuation of lands, stock assessment and evaluation of corporate rights). The list of our clients, many of who were customers just appraising the fixed assets, is given here: our clients. We can guarantee that with our works you will have no problems, as during our practical activities we have already filled may not be all the bumps, then at least many of the possible. And about the various pitfalls associated with agreeing or defending their position in the inspection bodies, as well as when using evaluation in court, we know this not from hearsay.
If you have never had a dealt with an expert evaluation as such, you may be interested in what is actually the result of such work (what document and what it looks like). On the page of our website “appraisal of real estate” you can find a video overview of what the evaluation report looks like and what it consists of. It is about a property report, but the essence of any kind of property is the same.
Please, make a list about expert evaluation of fixed assets in accordance with the above requirements and send us. And we will try to make you the most competitive offer. We provide services in Kyiv, Kyiv region and we often go to other regions of Ukraine. Call us!
