financialtreat – will explain about Asset Management Company and Its Purpose and Benefits which you will get in the following article. let’s look at this article carefully!
As the name implies, Real Estate Asset Management is an activity of managing assets belonging to individuals, organizations, or companies more effectively to achieve a goal. Moreover, the existence of asset management is also recognized as one way to improve company performance.
Then what are the stages that need to be done in the asset management cycle. Therefore, Real Estate Asset Management processing in a company that is engaged in achieving a certain goal Let’s see more in this article.
Asset Management Company and Its Purpose and Benefits
What is Asset Management?
The increasing open access to the financial industry is likely to make you no longer unfamiliar with this term. Since it was first introduced, some experts have tried to provide a simple understanding so that the term asset management is easy to understand. Danylo and Lemer explained that asset management is a methodology for distributing sources of power or assets so that they can be used efficiently to meet exclusive purposes.
Another expert, defining asset management is the art of guiding wealth or assets. This guiding art includes the process of planning, auditing, maintaining, and also the removal and transfer of unadjusted assets.
Then what is the definition of asset management in general?
In general, asset management is the process of effectively and efficiently managing assets belonging to an individual, organization, or company to achieve exclusive goals.
Benefits of Asset Management
The application of asset management to the company is useful for reducing non-optimal expenses and increasing income. Meanwhile, other benefits of asset management for companies are as follows.
1. Maintain asset value
The first benefit of asset management is to maintain the value of the company’s assets. With careful planning, the company can reduce the risk of losing the value of its assets due to loss or damage. Therefore, the value of the company’s assets remains high and can also survive, especially in unfavorable conditions.
2. Add security
Considering that the number of company assets is not small, the application of asset management is useful for maintaining assets to remain conducive and also avoid the risk of loss or damage. The existence of a special team in charge of handling it makes the company not have to worry because the assets have been recorded and stored conducively.
3. Facilitate budgeting
Asset management works with a special platform in order to facilitate the preparation of the company’s budget. An enterprise asset management news platform is very likely for companies to be aware of the state of assets so that the budgeting process is more practical and flexible.
4. Avoid overbought
Another benefit of asset management is that it hinders the purchase of excess assets. Armed with data from the asset management team, companies can compile budgets based on priorities and also reduce cost expenditures.
5. Create risk management
Although it can manage assets and prevent companies from experiencing losses, asset management cannot predict threats in the future. Therefore, the implementation of asset management must be complemented by the creation of risk management to help companies to manage the uncertainty of their assets in the future.
6. Monitor the arrangement of assets
Asset depreciation is something that companies should be aware of. If used continuously, the asset will decrease in quality both in terms of benefits and value. Therefore, the role of asset management is to monitor these urgently needed assets. Depreciation of important assets is monitored because it must be written in the company’s financial statements.
Asset Management Objectives
Well, after realizing the meaning and benefits of asset management, it’s a good idea to also be clear about the purpose of asset management in the company.
1. As a form of securing assets and funds
Asset management is a company’s effort to allocate assets so that they can be used efficiently in the long term. That way, companies can avoid falling asset values or wasting the use of assets and funds.
2. Maintaining the value of assets in the long term
Conducting asset management is an effort to build enlightenment for owners to continue to maintain the value of their assets. In asset management, the owner will learn if the rise or fall in the value of an asset depends on how the company or someone manages it.
3. Be aware of the standing and state of assets
The purpose of asset management is to be aware of the standing and state of assets. When starting to plan and maintain, the owner can understand whether the asset still has a high value and can continue to increase in the future.
Asset management also aims to write off assets if they are considered no longer profitable or have the potential to cause losses in the future. As an important part of the preparation of the accounting balance sheet
4. Maximize asset profits
Ultimately, the goal of asset management is to get the maximum profit from the assets owned. Regular asset management makes the company more careful before buying assets, so that the company will only choose assets with a level of profit that continues to grow in the future.
5. Choosing the right asset investment
Reducing the loss rate is both a goal and a benefit of asset management. By creating a priority scale and spending a budget on the best assets, companies can reduce the risk of loss in the future.
Asset Management Cycle
When carrying out asset management, the company must follow several stages or exclusive cycles in sequence so that the management process gives additional maximum results. Here’s the asset management cycle that the company must fulfill.
1. Planning asset needs
The first stage in the asset management process is to plan the company’s asset needs. In this term, the asset management team is tasked with explaining the needs of the company’s fixed assets both in the long and short term and also planning its management. The process is expected to minimize losses and also increase company profits.
2. Procurement of assets
After the planning is approved, the final cycle of asset management is that the company procures assets by purchasing assets according to their needs. This matching process can be carried out by the company itself or ask for help from other parties who provide assets.
3. Legitimate asset audit
Legitimate asset audit or legal due diligence is a stage of asset management aimed at examining ownership standing, procurement mechanisms, and asset transfer flows. Not only that, the legal audit set also serves to find solutions if assets are entangled in legal issues.
4. Maintenance and operation of assets
After all the recording and legality processes are completed, companies can use assets for business needs according to their respective benefits. The company must also carry out maintenance so that the assets can be used in the long term.
5. Asset evaluation
The asset management team needs to conduct periodic asset evaluations in order to understand in detail the value of the company’s wealth. This method is also useful in understanding the history of assets that have been transferred or deleted.
6. Asset updates
Once used within an exclusive period of time, the value or benefit of the asset may decrease. If the asset can be repaired, the company will carry out renewal or rejuvenation so that the asset can be reused optimally.
7. Asset write-off
If the value of the asset continues to decline and cannot be updated, the asset management team must delete it by destroying or using it so as not to cause losses in the future.
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Asset management tips
Asset management is an asset management process that must be carried out based on applicable decisions or cycles. But if your company is just about to start the asset management process, here are some useful tips to apply so that wealth management is more efficient and the company can achieve business goals.
1. Check all assets owned
When just starting asset management, it is important for companies to regularly check the value of the assets owned. This inspection is carried out to avoid the risk of unexpected expenses impacting the burden of ownership of unrecorded assets. An example of asset management is to conduct inspections every month so that the company does not have to pay taxes from cars or motorcycles that have been damaged.
2. Understand the asset lifecycle
Being aware of the asset life cycle can make it easier for companies to manage and use their assets. Not only that, but companies can also save time in retrieving rules to update or delete assets.
3. Create a cash inflow and outflow schedule
The large amount of cash inflows and cash outflows within the company often makes someone forget if it is very related to the amount of company assets. To stay under control, you can create a schedule that shows the timing of cash inflows and outflows. This schedule is useful for maintaining equilibrium of cash assets and business liabilities.
Well, those are some reviews that discuss Real Estate Asset Management with the explanation above, hopefully it will be useful and thank you for your attention.