Most often when exploring through mass amounts of fixed asset spreadsheet data, we ask… where are your disposals? Sometimes the answer we hear is: we deleted those. WHAT?
When you sell, exchange, abandon, retire, or in some other way dispose of an asset, you need to account for that process somewhere [a paper trail]. Generally, you do not want to delete an asset – ever. If you delete an asset, you lose all of its history information. Delete an asset only if you think you will never again need a single piece of information from that asset (for instance, for a tax audit).
Here are a few ‘proper’ ways to keep track of disposals:
- If using a spreadsheet, create a separate tab or worksheet to move them too.
- EVEN better… if you use an automated depreciation system [insert sales pitch – like Sage FAS], you can go through the steps to dispose of the asset, run your disposal report, account for your Gain/Loss and tie that back to your Journal.
If you would like to discuss other options — give me a jingle or become a pen pal!