While it's probably true death and taxes are the only two sure things, you could argue for a third. Depreciation. Every asset your company purchases starts to decline in value from the moment that it's placed in service. And with the tax laws seeming to change as often as the seasons - it makes good sense to invest in some serious computational horsepower.The government is great at changing laws. Even better at enforcing them. Not so good at simplifying them. If you're still cranking out depreciation expense computations on a manually created spreadsheet then it's probably time you started to look at some alternatives that will automate those depreciation expense computations and make sure you’re claiming every cent of tax credit owed.
While government compliance is an excellent reason to automate fixed asset reporting there's an even better one. It's simply not efficient to keep manually updating spreadsheets worth of information about assets. This manual calculation is prone to error - and it's also a huge absorber of your staff's free time.
Most companies these days are running leaner with fewer staff and even less time to spare performing relatively minor clerical functions like asset record keeping. So throw the spreadsheet away and learn about the top features to look for in asset software as well as a look a the unique features of some of the leading candidates.
Seven Features You'll Want
Custom report writing. Software publishers love to brag about their great and varied selection of canned reports. Most have great reports. Reality is that some of the reports are less than great and can take pages upon pages to print the simple listing of information your company needs.
In many cases, they always seem to be missing that one report which, of course, happens to be the one that you always were able to generate with your old software system. The problem with canned reports is one-size hardly ever fits all. Sure most systems do have a great selection of typical reports. But when the report you need isn't there - or it's there but a little too verbose - having access to a report writer is a lifesaver or at least a paper saver.
A strong report writer, either one developed by the software publisher or borrowed from a third party like Crystal Report Writer, is a must. But just having a report writer isn’t enough; check to see how user friendly it is. Can you make a report without attending a three-day class?
Custom depreciation methods. Unless your company is opening mining operations in a special district that allows for one-of-a-kind depreciation, chances are the methods included in this round of software meet all of your tax reporting requirements.
Where custom depreciation methods are nice is for one-off internal user computations that are specific to your business and no other. These custom depreciation methods could feature greatly accelerated computations.
Take for example a company that wants to use its fixed asset software to amortize warranties it offers. If, based on experience, only 5 percent of the warranty were to be used in the first year and then the remainder on a sliding scale in future years, they might be out of luck trying to find an IRS or GAAP method within the software that matches the companies own custom method. Custom depreciation lets you create the rules (usually for internal reporting) so that you're not stuck with a depreciation system that computes most of your expense but leaves you pushing a pencil for the last few assets.
Alternate books of treatments. A book of depreciation is used to compute separate amounts for reporting purposes. For example, tax depreciation is one method, book is another and state is yet another. Keeping these amounts separate, and on one convenient data entry screen, is a must.
At a minimum you'll want to have books for tax, GAAP, State, AMT, State AMT, ACE and a few spare treatments for more complex situations. All of the systems reviewed here support at least a half dozen different treatments and each of these treatments can generally be reported separately or sometimes used in combination on various reports.
Ease of data entry. Take a good look at the way your fixed asset system is laid out. The best offer grid layouts, multiple books of depreciation on one screen, heads down data entry, groups that can be easily navigated and an entire manual on-screen.
Avoid any system that will require you to exit out of one type of depreciation fully before going into another. This flipping of screens may not seem like a problem when the number of assets is low but when your assets grow the screen integration and ease of use will take on a new level of importance not originally anticipated.
Tax forms. Even if you're going to be transferring asset data to a tax preparation software you should look for a Fixed Asset program that will print the IRS forms which your company most often files. Fileable copies of the form 4255, 4562 and 4797 are included with most programs. You're going to need copies of these tax forms for making computations and inclusion in working papers, so make sure the software can print them and doesn’t force you to transfer data to a tax package only to print one form.
Integration. Is direct transfer of asset information to a tax package important to you? If so you'll want to look closely at whatever Fixed Asset software your tax program offers. Generally you'e going to have the best and tightest integration between software from the same company.
Does your firm file lots of tax returns? Zero your search in on a Fixed Asset system that offers integration to your tax package. The leading candidate for review should be from the same publisher that manages your tax package.
Fixed Assets CS
Dexter, Mich.
(800) 968-8900)
http://cs.thomsonreuters.com/fixed-assets/
Price: Starts at $1,500.
Fixed Assets CS
A feature-rich system, Fixed Assets CS, formerly Creative Solutions Depreciation Solution, features integrations to other Thomson products such as UltraTax and Filecabinet. Users of a Thomson solution would be wise start their search here.
The great benefit of the streamlined data-entry screens is that your firm becomes standardized around common methods of depreciation based on the type of asset you've entered. The more standardization you can introduce the less opportunity for mistaken asset classifications. Once the information been entered, it can pass through automatically to Thomson's tax and writeup offerings. Viewing data is simple as well - click the title bar of any column and your information will re-sort by that column.
Reporting is robust with Fixed Assets CS. There are a number of included reports that would be expected, including detail listing, depreciation projections, tax worksheets (4255, 4562, 4797). Each of these can be tweaked so as to add or remove information, change sorting or filter out data. Need a more specialized report? Chances are you can get it with the use of a report template that lest you save unique reporting profiles
ProSystem fx Fixed Assets
CCH
Riverwoods, Ill.
(800) 739-9998
http://tax.cchgroup.com/FixedAssets/default
Price: $1,975 (first user); $175, each additional user.
ProSystem fx Fixed Assets
If there were a contest for deepest and broadest suite of tax and accounting professional products, CCH Prosystem fx Suite would likely win. The foundation of the suite are the three key products - ProSystem fx Tax, ProSystem fx Document and ProSystem fx Engagement. Within the suite, there are another 14 separate modules, of which ProSystem fx Fixed Assets is one.
This system is clearly built for the power user. What’s especially impressive is that your able to work (and re-work) asset depreciation for even closed years without having to exert a tremendous effort to re-open older closed periods. Naturally future years’ projected depreciation is just a simple to compute. These often overlooked tasks can be a nightmare of steps in some products but not with ProSystem fx.
Report writing is all managed from a wizard driven screen. You are able to pick out specific data columns (over 100) to include and each page can have custom headers, footers and sorting options. The reporting options while broad are also simple enough that the novice user is able to grasp them immediately.
Once the data is into ProSystem fx it naturally travels to ProSystem fx Tax. But what’s unique about this travel is rather than be a one way trip into a tax package - you can also pull information from the tax software (company information, assets, adjustments) when the need arises.
Audit firms will definitely want to use the integration between Fixed Assets and ProSystem fx Engagement. With the software products linked so tightly you can store accounting files and reporting PDF documents with in the engagement file which greatly eases the burden of document management.
There are no asset limits in ProSystem fx Fixed Assets. Enter as many as you like and if you need to split them up - you’ll have up to 99 separate assets that can be created from one. It’s hard to go wrong with ProSystem fx - especially for users of any of CCH’s other tax and accounting products.
Fixed Asset Manager
CCH Small Firm Services
Kennesaw, Ga.
(866) 345-4171
www.taxwise.com/accounting/a-fixed.aspx
Price: $395.
Fixed Asset Manager
The Fixed Asset Manager is an offering from CCH Small Firm Services and is availabe in separate editions for that unit's ATX and Taxwise tax preparation packages. As you might guess it’s aimed at the smaller firm that may not need the full integration and power of some of CCH’s other offerings such as it’s flagship ProSystem fx suite.
The modules that make up the suite include Trial Balance, Fixed Asset, Client Write-Up, Client Checkbook, Payroll, W-2/1099, Payroll Compliance and Reporting. You may purchase Fixed Asset Manager separately ($395) or as part of the Complete Tax and Accounting bundle. The only difference between the ATX and TaxWise versions is that each transfers data into the corresponding tax software.
For the price it's hard for the smaller firm to go wrong with this product. You'll receive unlimited asset capabilities for an unlimited number of companies. Entering data can, of course, be entered manually via the good old fashioned keyboard method - or you can import directly from Excel or Thomson Fixed Asset CS or ProSeries Fixed Asset Manager.
Crystal Reports is a supported format for exporting data for further custom reporting. You may also export to Microsoft Word, Microsoft Excel or to an Adobe PDF format.
One unique features is a standard/actual tab. This gathers information that you enter on auto expenses and runs an automatic comparison that shows you whether the standard mileage rate is better or if you should claim actual. Yes the computation here is rather simplistic but it’s a nice touch especially for someone who may have a data entry staff person manage the actual expense input.
The ATX/TaxWise Fixed Asset Manager fills a niche for practitioners and companies that don’t need the extensive features of some of the higher-priced fixed asset systems. At $395 for unlimited assets and unlimited companies, this is a no surprises package that’s work a look.
Sage FAS
Sage North America
Herndon, Va.
(800) 368-2405
www.sagefas.com
Price: $2,345 (single user); $6,115 (five-user network).
Sage FAS
Sage offers two flavors of its popular fixed asset software: FAS 100 is built off a Sybase database engine and is best for companies with under 10,000 or so assets (there’s no hard limit but this is a general rule of thumb). Larger companies can step up to FAS 500 which is the same software but with a beefier SQL backend that is theoretically capable of reaching up into the unlimited asset range of capacities.
Starting up the software you're greeted with an asset snapshot. You'll be presented with high-level information like asset additions, dispositions, monthly total depreciation, and then the snapshot will work wonders for you. The screen can also be tweaked to show acquisitions by quarter, a five-year acquisition history and a depreciation history by book (state, tax, etc).
Seven books can be managed, each book computing depreciation on a separate basis. There are up to 10 user-defined fields where you can change the field name and use it for your specific purpose. Change the entry mask, rename the field or if you like, simply hide extra fields.
Want to keep detailed history of things like receipts, printed repair orders, product manuals? These can all be scanned and the images or documents attached to specific related assets. Tracking things like repair or maintenance due dates can be accomplished through some clever renaming of the package’s user defined fields.
There are 28 reports included out-of-the box. All of them can be customized using the original report as the starting point. There are plenty of options that should let you modify the reports to your liking. If needed, Crystal Reports writer is an available for custom report creation.
A new version of FAS is on the roadmap for the end of the year. It's expected to include the same functionality but features a more polished user interface, better search, temporary groups and the ability to custom fields directly as they're viewed on-screen.
Fixed Asset Web
BNA Software
Arlington, Va.
(800) 424-2938
www.bnasoftware.com
Price: Starts at $2,205 (first year); $1,675 (annual renewal).
Fixed Asset Web
The BNA Fixed Asset Web product is the only system reviewed that operates on a SaaS or software as a service model. This means you access the program via the web without storing any local data. All backup, configuration and upgrades are managed by BNA at its data center.
Logging into the BNA Fixed Asset Web it's difficult to tell that you're running all of your software through a web browser. The user interface is similar to what you'd expect with on-premise software. There was no noticeable lag in terms of the time it took to change screens or perform any other tasks.
There are five books of depreciation built in (the usual suspects - GAAP, Fed Tax, AMP, ACE, E&P) and up to 99 books can added. BNA offers some services around the setup and initial configuration of the system. The company says that each customer has unique needs and therefore the pricing and services offered can vary depending upon how much or how little of Fixed Asset Web the customer requires.
Reporting is traditionally a weak spot for SaaS-based products. Often the reports within those solutions are limited to a range of canned layouts with little room for variation. Not so with BNA Fixed Assets. There's a custom report writer wizard which is based off Crystal Reports. You also can hover over any of the report layouts and be greeted with a nice preview of what your report is going to look like. The reporting capabilities are impressive and you’ll quickly forge that you’re running all your processes over the Internet and through a web browser.
Data security is provided by BNA for physical access to the system. The product has met SAS 70 requirements and is certified as secure, with security being mostly roles-based, making adding or changing user rather simple
