Asset Management and Pas 55: Maximizing Returns from Capital Investments
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Asset Management and Pas 55: Maximizing Returns from Capital Investments Course
Introduction:
Effective management and accounting of fixed assets is crucial for every organization, as these assets serve as the primary resources for production and future benefits. This course is designed to explore the principles of managing and accounting for fixed assets based on the British Standard Institute's Publicly Available Standard (PAS 55).
The course encompasses the 28 key points outlined in PAS 55, which are categorized into fixed asset policy, strategy, management enablers and controls, implementation of management plans, performance assessment and improvement, and management review. By adhering to these points, organizations can optimize the utilization of fixed assets throughout their life cycles, from acquisition or creation to utilization, maintenance, and ultimately renewal or disposal.
The management aspect of the course offers decision-making tools such as net present value (NPV), internal rate of return (IRR), and other capital budgeting techniques. These tools assist in evaluating whether to acquire, replace, or refurbish assets. The accounting component is based on the International Financial Reporting Standards (IFRS), specifically IFRS 16 for property, plant, and equipment, and IFRS 38 for intangible assets. Participants will learn about the capitalization rules for fixed assets and intangibles, as well as the measurement of assets at fair value. The course also covers various depreciation methods and rules for asset impairment measurement and accounting.
Course Objectives:
At the end of this program, delegates will be able to make a substantial, positive impact on the asset management best practices within their organization, specifically:
- Apply the 28 point requirements to establish a whole life asset management system according to PAS 55 and ISO 55000
- Evaluate investments in fixed assets according to Net Present Value (NPV), Internal Rate of Return (IRR), and other methods
- Recognize and correctly measure fixed assets and intangible assets under International Financial Reporting Standards (IFRS)
- Justify the accounting and reporting for transactions throughout the life of the assets
- Account properly for impairment, disposals, and sales of long-lived assets
- A step-by-step guide to asset management - starting with foundations and building up to best practice
- A solid understanding of best practice techniques for achieving effective asset management
- An understanding of a range of technical and human risks associated with asset management and how they can be mitigated
- The ability to design a tailored asset management improvement plan for their organization which tackles the major risk areas
- A practical approach to developing an action plan to utilize these technologies in their own areas of responsibility, fitting them into the overall asset management strategy, and measuring benefits
Who Should Attend?
Fixed assets professionals including supervisors, account managers, purchasing and facility supervisors and coordinators, financial controllers, new employees handling fixed assets, internal auditors, maintenance assistants and managers, and operations managers.
Course Outlines:
ASSET MANAGEMENT FUNCTION
- Introduction to the British Standards Institute’s PAS 55
- Introduction to ISO 55000
- Asset management objectives
- Asset management benefits
- Requirements of PAS 55 for effective asset management
- Risk management and asset management
EVALUATING INVESTMENTS IN ASSETS
- Making investment decisions
- Time value of money
- Net Present Value (NPV)
- Internal Rate of Return (IRR)
- Other tools for valuing investments
FAIR VALUE MEASUREMENT
- IFRS 13 fair value
- Three-level hierarchy for Fair Value (FV)
- Valuation techniques under IFRS
INITIAL MEASUREMENT OF LONG LIVED ASSETS
- Measurement and recognition of fixed assets
- Classes of long-lived assets
- Construction of tangible assets for internal use
- Measurement and recognition of investment property
- Measurement and recognition of intangible assets
- Required disclosures
SPECIAL TOPICS IN ACCOUNTING FOR FIXED ASSETS
- Capitalization of borrowing costs
- Decommissioning costs
ACCOUNTING OVER THE LIFE OF THE ASSET
- Costs incurred subsequent to purchase
- Leasehold improvements
- Accounting for leased assets
- Subsequent expenditures on intangibles
- Accounting for assets under fair value model
- Concept of component depreciation
- Depreciation methods
- Partial-year depreciation
- Straight-line depreciation method
- Units of production method
- Accelerated depreciation methods
- Revising depreciation rates
IMPAIRMENT AND DISPOSAL
- Definition and rules of asset impairment
- Impairment measurement and accounting
- Impairment indicators and computation
- Accounting for disposing or idling of assets