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What is the property tax angle on capital asset management reengineering?
“Fixed assets software is starting to more accurately reflect the diverse asset and asset management needs of today’s business,” says Stewart McKie in the August issue of Controller Magazine.
His article, “Feeding Asset Management Appetites,” goes on to explain the additional functionality that the software vendors are adding to their core products through a “best-of-breed” strategy. (One of those mentioned is property-tax-compliance software from Vertex.) The more accurately these software products reflect the needs of businesses, the more readily they will be adopted. As a result, they will present Fixed Asset Managers with the opportunity for great productivity gains.
At the same time, a number of companies that have adopted the larger-scale, enterprise-wide software applications—SAP, PeopleSoft, Oracle, etc.—have implemented order entry and A/R and A/P modules first and are now turning their attention to the fixed-asset-management components. In many cases, those same “best-of-breed” options are already available through third-party software providers. Again, the timing seems right for new breakthroughs in efficiency and management understanding.
What’s in it for property tax managers? And with property-tax audit activity on the rise, how can you guarantee the receipt of those benefits?
One of the first steps in adopting the new software should be a review of fixed asset data. Unfortunately, even the best software in the world is still subject to the “garbage in–garbage out” principle. Over the years, many industries have seen their fair share of mergers, acquisitions, downsizing, and right-sizing. In the process, the original and historical costs of their asset bases may have become blurred.
The key is to undertake this review with property tax compliance, not just fixed asset accounting, in mind. So, in addition to this “standard” list of fixed asset management data, the following components should be part of that review:
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