Fixed asset software does not get a lot of attention in many accounting practices. That lack of attention often follows through to the client's sites as well. If you took the time to analyze the situation, you'd probably find that many of your clients are probably performing depreciation and amortization calculations either manually, or with the aid of a simple spreadsheet.
And that's just plain wrong.
Over the years, depreciation and amortization of assets have gone way beyond the simple double-declining balance of yesteryear. Each asset needs to be examined individually, and you and your client need to decide the best strategy for managing the depreciation/amortization process. Because the rules and rates on assets change frequently, this analysis needs to be performed annually, or your client may not be realizing the full value of the process.
Spreadsheets can certainly perform complex mathematical calculations. They are, however, not the best tool for managing fixed assets. What your clients need is a combination of database and calculation engine. The database portion of the application helps them manage the acquisition and disposition of the assets, as well as segregating the assets physically and logically (as to where they appear on the financial statements). The calculation engine makes sure that the assets are depreciated or amortized according to the most advantageous legal methods available under the current regulations, while still allowing you to override the process if you require justification for an alternative method.
Fortunately, this isn't an application that you or your clients need to construct. Fixed asset software is widely available that both tracks the asset and its current and past valuation, and helps you and your clients decide on the best way to treat the asset on an ongoing basis. To help you find the best package for your clients, we examined seven of the most popular fixed asset applications.
Sauteing the books?
From a conceptual point of view, fixed asset processing is a fascinating application. In most other aspects of accounting, maintaining multiple sets of books with differing values for the same account would be a felony. With fixed assets, it's business as usual. With differing depreciation methods and rates supported under generally accepted accounting principles, Internal Revenue Service rules, and sometimes multiple state regulations, you might have four or even eight completely different sets of calculations for the same sets of assets.
Things get really frisky when you add in the possibly of multiple company subsidiaries, all of which need to track their own fixed assets, then consolidate them for corporate-wide reporting. Fortunately, this is exactly the reason that computers are so useful in business. With the right package, keeping all these balls in the air is no problem.
Your particular clients' specific needs will determine which package is the best fit for them. While all fixed asset packages do have a basic set of features in common, how these are implemented, as well as the general capacities and the ability to span multiple subsidiaries, are all-important differentiators.
You might not think that capacity would be a consideration. After all, 250GB hard disk drives are now common and affordable. The latest motherboard designs easily support four serial ATA hard drives, which provide a terabyte of storage!
In this case, though, it is the software that imposes the limitations - not the hardware. Depending on the language or database used, there might be an upper limit of 32,000 on some of the values such as the number of assets, and $99,999,999 on dollar values.
Those are pretty "up there" limits, but there are lots of companies that have enough depreciable assets to exceed them, especially if the assets are continued on the books after they are fully depreciated, rather than being disposed of.
Another feature to keep your eye out for is the availability of wizards, especially those that help you or your client determine the most opportune method to adopt. These are probably more important for your clients, since you have a much more in-depth understanding of the implications of using any particular method.
On the other hand, you probably don't want your client calling you every time they add a new asset. While you may want to override the decision of a wizard when you visit the client, assuming that the software is well designed, the wizards should be right more often than not. It will be the client's specific circumstances that will cause you to decide on a different method, rate or term.
There's one additional "general" feature that you should keep in mind when examining fixed asset packages for your clients. Because the regulations change so frequently, it's important that the vendor be right on the money with timely and accurate updates and fixes. Ask to see a history of the product updates for any package that you are considering recommending to a client. If the vendor is updating the package infrequently, it may be a heads-up that it doesn't have the resources to follow the latest rulings and quickly comply with them.
On the other hand, the opposite may also be true. Too-frequent updates may indicate that the vendor rushes updates out the door without adequately checking that the calculations are accurate. This is actually pretty easy to spot if you audit the upgrade notices - you'll see multiple updates for the same item.
Be careful, though, because this doesn't automatically mean the vendor is at fault. There have been more than a few occasions when new regulations have been promulgated, then updated multiple times in the weeks that followed the original release. In this case, a competent vendor has no choice but to update the calculations multiple times as well, to be in compliance with the changing (or clarified) regulations.
You pays your money, you makes your choice
The seven fixed asset applications that we tested fall into two general groups - entry-level and mid-range. That differentiation is more on price than any other factor, though the higher-priced mid-range packages often also have more capability to function in an enterprise environment.
Many of the packages we reviewed have demo or trial versions that can be downloaded from the vendors' Web sites or requested on CD. If you are having trouble narrowing down your choice between two or three vendors, downloading the demo and running through it, perhaps with your client for their comments, is a good way to go.
As far as system requirements go, none of the seven packages have unusual needs. Our testing was performed on an Intel Pentium 4-based system, with a 2.4GHz processor, 1GB of memory, and a 120GB hard disk drive. Our test platform was running Windows XT Professional, but we had not yet installed the newly released Service Pack 2.
At the same time, don't let your client run fixed assets on the oldest rinky-dink PC they have in the building. Fixed assets is an important component of the accounting system, and that makes it mission-critical for most companies. PC prices are at an all-time low right now. That means that the client can buy a brand-new PC with a DVD burner for high-capacity back-up for not much more than $1,000. You could easily exceed that figure in hourly charges to the client if you had to reconstruct extensive fixed assets ledgers and calculations due to an old PC giving up the ghost and taking the client's fixed asset data along with it.
AccountantsWorld Fixed Asset Relief
Fixed Asset Relief is part of the Accountant's Relief series of applications from the company that used to be known as MicroVision Software. Now renamed AccountantsWorld, after its extensive online portal and Web site, the vendor still provides very credible and affordable applications for the accounting practitioner. Fixed Asset Relief is just such an application, and is appropriate for use either in your office, or by your client.
One area where this vendor has always excelled is data entry. It still does. "Speed pads," which are screens specifically designed for data entry, make the process of setting up a client, or entering new assets during the year, very fast and easy. As with many of the other packages that we reviewed, you can copy a similar asset's data to a new asset, changing just the information, such as an ID number, that identifies the new asset.
For an entry-level application, Fixed Asset Relief provides a comprehensive set of reports, and handles all of the standard depreciation methods and timing conventions. Reports are easily modified using filters and the included Report Writer or Query Writer, and user-definable fields let you or your clients track data that is specific to them.
Fixed Asset Relief has minimal import and export capabilities. You can import data only from the DOS version of Fixed Asset Relief, and export only to a comma-delimited file from Accountant's Relief. If you are using another vendor's write-up or tax prep applications, you'll have to transfer data by hand.
On the upside, however, Fixed Asset Relief is one of only a few packages that can produce an IRS-approved laser-printed Form 4562 (depreciation and amortization) for inclusion in your client's tax return. Just how useful this actually is depends on how you produce that client's return. In many cases, you'll have to hand-key the data on Form 4562 into your tax-prep application.
Still, it's hard to find much fault with Fixed Asset Relief. The price is right, the reports look good and are easy to use, and data entry and navigation are a snap. You can even add additional users at a very reasonable cost.
If your client is a huge enterprise, you may want to look at one of the more expensive, more upscale packages. For many small and midsized companies, however, Fixed Asset Relief will fit the bill perfectly.
Bassets Fixed Asset System
Many software vendors provide a list on their Web site and in their marketing materials of companies that use their packages. The marketing material for Decision Support Software's Bassets Fixed Asset System prominently features the Bed, Bath & Beyond chain. With more than 600 stores in the chain, each one with an extensive number of depreciable assets, the fact that this particular nation-wide chain is using Bassets says something very positive about the system's capabilities and capacities.
Depending upon the version of Bassets that your client purchases (there are three offerings), there can be up to 150,000 asset records. The general ledger account numbers can be as large as 256 characters, so it is pretty easy to set Bassets up to interface with almost any accounting system that your client may be using.
Decision Support Technology offers an entry-level version of Bassets, called Bassets Lite, which sells for about half the price of the standard edition. The Lite edition does not have some of the features pertaining to disposals and transfers that are found in the more expensive edition, but it is multi-user-capable. A third version of the software, Bassets Plus, is a client/server application written using Microsoft SQL. Hardware requirements for all but the SQL Server version are very modest, at the Pentium or Pentium II level. Bassets Plus requires Windows NT Server or Windows Server 2000. These operating systems require slightly more in the way of hardware, but will still run pretty nicely on a Pentium III.
We tested the standard edition of Bassets Fixed Assets without the Report Writer. This edition provides 23 standard reports. These are nicely laid out and easy to work with. You can also export reports to Excel and ASCII files, as well as older formats such as Lotus and dBase. You can also import data from ASCII and Excel files as well as Best's FAS system.
We found Bassets easy to install and configure. The working screens are not cluttered, and tabs on the tops of many screens determine what data and format are presented. As with several of the systems we tested, you can attach images of a particular asset to its record. This may impact the processing speed on older PCs, but it's a good idea if your clients have many assets that are similar in nature. All standard depreciation methods are supported, as well as the Canadian Tax Code. You can also set up custom depreciation tables for your client.
Bassets has been available for quite a while, which is both good and bad. In some areas, such as reporting, it doesn't have quite as much flash as some of the other products we looked at. It is, however, a mature and powerful product. It is also very expandable by adding optional modules, which include leased assets, construction in progress, foreign currency, GL and accounts payable interfaces, 4-4-5 weeks/13-period accounting, units of production, bar code, expense allocation, and several others. Discounts are available for purchases of a "suite" with two or three of the optional modules.
How good a value Bassets represents depends on how you need to configure the system. Some of the options are standard in several of the other systems. At the same time, Bassets has exceptionally high limits on many of the data sets. With all of the available bells and whistles, though, Bassets can easily hit $5,000 or more.
Best FAS Fixed Asset Management 2004.2
The FAS Fixed Asset Management system has been around for quite a while - long enough to go through several turnovers of corporate ownership before winding up in the Best Software stable. Over the years the product has continued to be refined so that, at the present time, it has emerged as one of the premier products in its class.
That market position also carries a pretty hefty price tag, as the single-user price for the standard edition without report writer that we reviewed definitely places FAS Fixed Assets in the more expensive mid-range of fixed asset applications. That price, by the way, is before you start adding in all of the available upgrades. These include the aforementioned report writer module, a module for performing construction-in-progress asset accounting, an asset inventory module that includes bar coding and the ability to use PDA bar code devices, and even a set of software integration tools.
These last options include general ledger links that allow you to hook up the FAS Fixed Assets application with Peachtree Complete Accounting, MAS 90, MAS 200 and MAS 200 for SQL Server, MAS 500, and Platinum for Windows. Other custom links are available for Great Plains Dynamics and eEnterprise, Solomon for Windows, and Timberline. The software integration tools also provide AR/AP Links for MAS 500.
For those of your clients with more limited needs, Best also offers FAS FirstStep, a more affordable version of the software that can later be upgraded to the full FAS Fixed Assets system.
The standard version of FAS Fixed Assets that we reviewed has a complete and comprehensive set of reports even without the optional report writer module. All common depreciation methods and timing conventions are supported, other than construction in progress, which requires the optional module. Wizards are not used to help select a method or timing, but there is extensive online help and reference to current regs and rulings. Seven books are supported, the standard five (internal, tax, state, alternative minimum tax, and adjusted current earnings) as well as two user-defined books. FAS Fixed Assets has excellent capabilities for disposals and transfers.
We found set-up pretty much run of the mill, with no difficulties or problems. You can easily copy assets or groups of assets, then modify the copies to reflect a new asset addition.
As with many higher-end applications, FAS Fixed Assets is not an off-the-shelf product. You'll have to purchase it through Best, and, most likely, through a Best reseller that will want to bundle additional products such as installation assistance. This is common practice with software applications at this price and capability level.
BNA Fixed Assets DesktopPro V. 2004.2
BNA's fixed asset application is a mature product, as well as being one of the major applications in this market. It is available in many formats, including an entry-level edition (called Fixed Assets SBE) and even a Web-based scalable edition. The DesktopPro edition that we tested for this review is available in single and multi-user versions, as well as a SQL-based client/server edition.
As you might expect from a top-of-the-line application, DesktopPro offers all of the commonly used methods and timing conventions, including some, such as Indian Reservation, that are either unavailable or optional with some of the other vendors' offerings that we looked at. While the application doesn't provide a pre-defined wizard for determining the "right" method and life for an asset, it effectively accomplishes the same thing by automatically setting the asset up once you've entered the acquisition cost and date, and type of asset. You can override this if you want to, though in most cases you won't want or need to do this. You can even print reports in legal (8.5 x 14 inch) format for inclusion in legal documents.
DesktopPro produces one of the most comprehensive sets of reports of any of the applications we tested. It also produces a host of IRS-fileable forms, including Forms 3468, 4255, 4562, 4626, 4797 and 8824, as well as a non-fileable Schedule M-1. As with other fixed asset applications that produce some of these forms, the usefulness of this feature depends upon what tax preparation methods you are using for the client. For those clients who need reports considerably out of the ordinary, an optional report writer from Crystal Reports is available. Reports can be output in a variety of formats, including HTML for Web publishing, and PDF for electronic distribution or archiving.
As you'd expect from a high-end product, the application has extensive import and export capabilities. You can import data from other fixed asset applications, including Best FAS and FAS FirstStep, CSI Depreciation Solution, RIA's GoSystem Fixed Assets, and others. Spreadsheet import is available using the CSV format, and you can export fixed asset data to other BNA fixed asset products as well as many accounting applications.
DesktopPro isn't for all of your clients. While it's easy enough to set up and use for even a small company, it simply has much more capability than most smaller companies will use or are willing to pay for. For this size client, you may want to consider Fixed Assets SBE (Small Business Edition). It's very similar in layout, and provides an easy upgrade path at the point your client finds that it can use the more capable DesktopPro edition.
CCH ProSystem fx Fixed Assets
As with several of the other products covered here, ProSystem fx Fixed Assets is designed to be part of a more comprehensive accountant's suite of applications. That isn't to say that it can't be used effectively in a stand-alone mode, which it most certainly can. It's just that the application provides seamless integration and data transfer with other ProSystem fx applications such as ProSystem fx Tax and ProSystem fx Engagement.
As with Creative Solution's Depreciation Solution, ProSystem fx Fixed Assets is priced somewhere in the middle of the pack, halfway between entry-level and higher-end. Feature-wise, however, it is definitely up there with more expensive offerings. All standard depreciation and amortization methods are supported, as are commonly used timing conventions, and it is not difficult to create your own depreciation tables or custom timing approaches.
You can even calculate negative depreciation, should you find that your client has use for this. Some less common methods, such as those used for Indian Reservations and Units of Production, are also provided. Eight different books can be created - the standard financial, federal tax, state tax, AMT and ACE, and up to three custom books. ProSystem fx Fixed Assets also handles disposals and like-kind exchanges very well.
The fixed asset application has extensive import capabilities, letting you bring in data from many of the other popular fixed asset applications or even an Excel spreadsheet. The reports are very well designed and quite usable. You can produce them in PDF format for easy electronic distribution and archiving. Both Forms 4562 and 4797 are produced in the IRS-approved format, though depending upon how the tax returns are produced, you may wind up re-keying the data anyway.
We really liked the way that ProSystem fx Fixed Assets can be customized. You can tweak the data entry screens for the particular client, or to meet the needs of your staff. There is one place, however, where it falls a little short. That's in integration with a write-up package, since at the moment, CCH does not offer this application as part of its ProSystem Office suite.
Creative Solutions Depreciation Solution
Depreciation Solution from Creative Solutions, a Thomson business, is priced right in the middle of the bunch of the seven applications that we reviewed. As you might expect, it has aspects of both the entry-level and mid-range applications.
The major entry-level characteristic, in our opinion, are the limitations on the number of assets. While the ability to maintain up to 7,000 clients should not be a problem for any practice, the maximum number of assets, 32,000, that any single client can have can be exceeded by some asset-rich large enterprises. You could always do a work-around, setting up subsidiaries or locations as different "clients," and then consolidating them by hand or with a spreadsheet, but a preferable approach is to use an application that can meet your client's needs without kludges.
The Depreciation Solution is a bit different from the other applications that we reviewed in that it is intended to be used by the accountant, not the client. Sure, you can set the software up so that data entry is performed at the client's location, but the real worth of the software is that, as with all Creative Solutions applications, data moves transparently from one Creative Solutions application to another. That means being able to import assets from the General Ledger or Accounts Payable (when they are purchased), and transfer tax-related balances from the fixed assets system directly into the tax prep software. If your practice has many clients for which the Depreciation Solution is appropriate, this can be a tremendous time saver.
Even if this capability isn't of particular interest, you'll find the Depreciation Solution a very usable fixed asset management system. It has a similar look and feel to other Creative Solutions applications, which means that the software is easy to set up and very easy to maneuver through. Depreciation Solution provides all of the common depreciation and amortization methods and timing conventions, and lets you construct as many as 99 additional ones of your own. A Method/Life Wizard helps your client (or your staff) decide on the most appropriate method and term to depreciate any specific asset. This is not a default option; it has to be selected, so you aren't automatically defaulted into someone else's idea of the "best" way to depreciate.
The reports in Depreciation Solution are well designed, attractive and comprehensive. They are easy to modify with available filters, and extensive graphics are also available to make selected reports instantly understandable. There's even an Image Worksheet, which produces an asset's image (if your client uses this capability) along with information on that asset such as cost, net book value, location, warranty and other data. The optional FileCabinet Solution allows you to store all reports and documents on the PC's hard disk drive, or even burn them to optical media such as CDs or DVDs.
MoneySoft Fixed Asset Pro
At just under $500, Fixed Asset Pro from MoneySoft was the least expensive of the seven packages we looked at. Still, inexpensive does not necessarily mean incapable. Fixed Asset Pro offers all of the standard depreciation methods, as well as the ability to build your own custom tables. While low-priced, the software allows you to create an unlimited number of asset records for an unlimited number of companies. The applications' major limitation is that it is essentially a single-user product, though you can purchase and install multiple user licenses. The software does not seem to be designed as a multi-user application, however. This will limit Fixed Asset Pro's usefulness in many companies that have geographically distant or functionally different subsidiaries or branches that would normally perform their own asset management functions.
Set-up is straightforward, as is entering assets. Fixed Asset Pro provides the common standard depreciation methods and timing conventions, and lets your client create up to five books - AMT, ACE, financial, state, and other. The process is nicely detailed in the documentation, but there are no wizards to walk your client through the selection process for a particular type of asset. The only wizards available in the application are an import wizard for importing data from the DOS version of Fixed Asset Pro, and a back-up wizard.
Reports are pretty basic, though quite readable and usable. Filters give you a fair amount of flexibility, and there is a basic Report Writer included so that you can produce reports as needed on an ad hoc basis.
Screens, however, are very nicely designed and very easy to navigate through. In the asset edit screen, you can get detail or summary figures for the asset, and even link an image of the asset to the record, a feature that's very useful and often considered high-end.
Fixed Asset Pro does have some limitations when compared to some of the much more expensive applications that we reviewed. It is not as easy to handle partial disposals and some of the less standard and commonplace transactions as it is in some other packages. Other packages also provide more report choices. Still, if Fixed Asset Pro will meet your client's requirements, it's hard to argue with the price.
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