Identifying and Managing Asset Impairment

There are various causes of fixed asset impairment. The most common ones are physical damage, obsolescence, and abrupt market changes. If an asset’s market value falls lower than its book value and isn’t likely to return, then this asset must be recorded as impaired. Knowing these causes helps businesses take precautions over their assets and prevent such substantial financial losses in advance.

Equipment, vehicles, and property are examples of impaired assets. Fixed asset tracking uses different solutions, such as RFID asset tracking, GPS, specialised software, etc. These techniques are essential for monitoring the status and value of such assets. A business can identify impairments and make proper adjustments to its accounting records.