Capital Asset Reconciliation
Our past newsletters have discussed in detail the subject of capital inventory projects, why they are needed, the right time for an inventory, and how to prepare your staff for an inventory project engagement, etc. In this month’s issue, we will focus on the benefits of reconciling your assets upon completion of a physical audit.
Asset reconciliation is the capability of reconciling the differences between a
current physical inventory of what actually exists and the database accounting
system of what they believe exists. A major component of any audit is cross
referencing data collected during a physical audit with the facilities’ accounting
asset ledger. Reconciling the ledger provides a clean picture of assets located
in the property. This information can impact a few different areas for the facility:
- Keeping the asset ledgers up to date will help your business make sound decisions on equipment that may need to be replaced.
- Reconciliation provides savings when removing ‘ghost assets’ from the books. This will eliminate insurance payments paid on assets that are no longer physically on the property.
- Reconciliation supports financial, risk and compliance management solutions.
- Reconciliation allows accounting to accurately associate physical assets with cost centers for each department.
- An accurate ledgers allows the CFO to properly develop operating and capital budgets.
- Fixed asset records should be continuously updated as preventative maintenance is performed on the equipment.
When planning for a facility inventory project, it is important to remember the physical inventory and reconciliation go hand in hand. In order to make the entire process easier, data captured from the physical audit must be as descriptive as possible. In the case of a hospital audit, it is necessary to identify the location, department, asset description, model, manufacturer, current asset number and serial number of each asset so that it can be easily compared to what exists within the hospital. In many cases, hospitals and large health care facilities choose to utilize bar code technology to permanently tag each asset during their inventory process. Bar coding will help provide a detailed ‘snapshot’ of each asset located at the property, and will help make future reconciliations easier.
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Summer is finally here and MRG is preparing to exhibit at the 51st Annual AHRMM conference and exhibition July 28 – 31 in San Diego, California. We are looking forward to this show which will feature the latest information and innovations for supply chain professionals. Be sure to stop by to see us at booth # 622.
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MRG’s Fun Facts:
Planning a beach vacation soon? Interesting fact to know about what may be swimming
around us in the ocean…
Jellyfish like salt water. A rainy season often reduces the jellyfish population by
putting more fresh water into normally salty waters where they live.
Manage Resource Group, Inc. is a privately owned healthcare equipment management company headquartered in Berea, Ohio. Our client focused services create strategies for each customer to increase profitability on capital equipment. We are industry experts offering the following service lines:
- Inventory services
- Appraisal services
- Resale management
For more information, visit our website at www.manageresourcegroup.net