Apartments: Fixed Assets Inventory Systems
The goal of this information is to provide concise guidelines and essential information needed by apartment community managers who have fixed assets and other items of value entrusted to their care. It will also serve to provide guidance and direction in the proper handling and accountability of community property and fixed assets and to ensure a property management system that permits the tracking of all assets and reconciliation between physical inventories and accounting records.
Hopefully it will serve as a management tool and enhance the accuracy of community records. The majority of larger management companies have established procedures and guidelines for asset inventory systems—well, at least the couple I worked for did. The real problem was that every time I took over a community, there was never one in existence—and then who in the world had time to create one!? Well the truth of the matter is, I always made time to complete one because, regardless of the importance the management company placed on having this information updated, I knew that it was my fiduciary responsibility and showed my understanding of such to the owners of the community itself. My second reason for doing this was purely self-preservation. In the heydays of my property management career, it wasn’t abnormal for a community to be sold either by itself or as a package, so I wanted to make certain that I had the records straight for the community since takeovers weren’t always friendly. Anyway, I hope this information will help you better understand the importance on fixed asset inventory controls and, in the process, assist you in being the very best manager you can be, even if someone higher up doesn’t require it of you.
Definition of Property
For the purpose of this procedure, “property” is defined in four broad categories as follows.
- CAPITAL ASSETS
Community property of a non-consumable nature (not used up or changed materially through use) acquired by the Community. When the property is purchased with Community funds and the purchase price is, for example, $1,000 or more per item or $10,000 or more for an aggregate purchase of similar items, the property is considered a capital asset. Management Companies may have establishes their own dollar amounts for this purpose. Software with a purchase price of, for example $1,000 (again, this may vary according to management company procedures) or greater is considered capital property. All capital assets should have a useful life of more than one year. These items are assigned a capital approval number, a “Property of Community” sticker and a label that is numbered with the asset number is then affixed to the property when they are received.
- NON-CAPITAL PROPERTY
Equipment, furniture, and other tangible items of a non-consumable nature (not used up or changed materially through use) acquired by the Community.
The purchase price is under the established capital values, as shown above, and the expected useful life is at least one year. These items receive a “Property of Community” sticker and the property code label as it applies.
- SUPPORT MATERIALS
Reference materials, periodicals, audio/visual tapes, etc. used for employee reference. These items must be marked or tagged “Property of Community.”
- OTHER PROPERTY
Property owned by a service provider and provided for use of the community’s use. These items should be tagged with a sticker that clearly states the company name and contact information.
Accountability for Property
It should be the responsibility of every employee to safeguard Community property and assets. Every employee has a duty to promptly report any suspected or real incident of theft, damage, or loss of Community property or assets.
Community supervisors, managers, and service personnel are responsible for ensuring that property under their control is adequately protected against damage, theft, or other loss. They must also ensure that all such property is used correctly and only for legitimate Community business. Property should not be removed from the community.
Fixed Assets Receiving and Tagging Process
The following process takes place when a Community receives new assets—and can be very useful information when establishing a new community or model.
- The item is received from the delivery truck with a packing slip. The container is opened, and the contents are verified to the packing slip.
- The information on the packing slip is entered into the inventory/ asset control log. The original packing slip is then processed according to company procedures. A manger will save a ton of time and headaches if this is handed the minute inventory arrives at the community.
- The property is then labeled with “ Property of Community” and inventory control number labels.
There have been many times when I have had to move a model, change a model’s type, or relocate the service department. When this occurs, it is always wise to pull out the control sheets, perform a quick audit, and report any and all discrepancies to the appropriate parties.
Lost, Stolen, Damaged, or Destroyed Property
As things like this happen, it is very important to report LOST, STOLEN, DAMAGED OR DESTROYED PROPERTY. Reports should include a detailed description of the item(s), to include Community Property Control number(s), model number, and serial number. In all cases, a copy of the report should be forwarded to the Property Management Company and your supervisor. Community property records should be updated.
The Fixed Assets Inventory
The Fixed Assets Inventory is a list of all assets of significant value that are owned by the community.
The onsite manager is responsible for all assets listed on the form.
The initial inventory form should only need to be completed once.
As assets are purchased, they should be added to the appropriate form. As assets are deleted, they are crossed off the appropriate form.
Fixed Assets Inventory is annually updated at the end of its respective fiscal year. A copy of the updated inventory should be forwarded to the Corporate Office for safe keeping and reporting to owners at the end of the fiscal year.
Additional updates should be completed whenever a new manager takes over, or each time additions or deletions are made. These updates should be sent to the Corporate Office.
The Maintenance Inventory form should be completed whenever there is a change in Maintenance Supervisors.
A current copy of the Fixed Assets Inventory should be kept in the community and in the corporate office.
Fixed Assets include:
- Office furniture and equipment
- Filing cabinets
- Computers& monitors
- Fax machines
- Lamps, tables
- Valuable wall/floor furnishings
- Any other moveable furniture or equipment
- Clubhouse furniture and equipment
- All items of significant value, which are not rented.
- Golf Carts
- Pool furniture and equipment
- Cleaning equipment
- Recreational equipment
- Safety equipment
- Wall furnishings, etc.
- Hand Trucks
- Golf Carts
- Any equipment of significant value
- Landscaping equipment
- Any equipment of significant value
Items not to be included on the inventory are:
- Supplies (office, maintenance)
- Rented furniture or equipment
- Any personally owned items
Each item listed should be assigned a digit inventory control number. Typically a company will have a method for assigning these numbers.
There are software packages available that will handle this type of inventory control. A few are:
Example: Fixed Assets Inventories Form
Community Name: ________________________
Please check which Inventories are attached:
|OFFICE FURNITURE AND EQUIPMENT
|CLUBHOUSE FURNITURE AND EQUIPMENT
|POOL FURNITURE AND EQUIPMENT
I HAVE PHYSICALLY VERIFIED THE ITEMS LISTED ON THE ATTACHED FIXED ASSETS INVENTORY AND UNDERSTAND THAT I AM PERSONALLY RESPONSIBLE FOR THEIR SAFEKEEPING.
|(On- Site Manager’s Signature)
|(Maintenance Supervisor’s Signature)
*Responsible for items on Maintenance Equipment Inventory.