What is an Asset?

An Asset is a resource with economic value that an individual, corporation or country owns or controls with the expectation that it will provide future benefit. Assets are reported on a company's balance sheet, and they are bought or created to increase the value of a firm or benefit the firm's operations. An asset can be thought of as something that in the future can generate cash flow, reduce expenses, improve sales, regardless of whether it's a company's manufacturing equipment or a patent on a particular technology.

Assets can be broadly categorized into short-term (or current) assets, fixed assets, financial investments and intangible assets. Assets are recorded on companies' balance sheets based on the concept of historical cost, which represents the original cost of the asset, adjusted for any improvements or aging. Historical cost is also called the book value.

The following is the Process to be followed in our System for Asset Management.

1. Setup Depreciation Master Table based on Government Guidelines

2. Create Asset Categories

3. Create Asset Item

4. Purchase Asset

5. Assign it to Employee / Cost Center / Project

6. Enter Asset Repair/Maintenance (Refer Asset Repair / Maintenance Document)

7. Run Depreciation (Refer Asset Depreciation Document)

8. Asset Reporting

1. Create / Register Asset 

To Create an Asset Item, Click Asset Management -> Asset Master -> Click Create New.

? How to Register a New Asset in HAL ERP

When you purchase an asset for the first time (e.g., a laptop, table, or furniture item), you need to create a record in the Asset Management module before processing its financials or Purchase process.

Step 1: Create New Asset

1. Navigate to Asset Management → Create New.

2. Enter the Asset Name (e.g., Lenovo Laptop).

3. Add a Description (optional).

Step 2: Select Asset Category

1. Choose the correct Asset Category (e.g., School & Office Equipment, Furniture & Fixtures, Vehicles, Software).

2. Once selected, the Ledger Accounts (Asset Account & Depreciation Account) will be populated automatically.

   • Verify that the mapped accounts are correct.

   • Example: Asset Account = 15300, Depreciation Account = 58502.

Step 3: Enter Basic Details

1. Set Status = Active.

2. If purchase price is not yet known, you can enter an estimated price (e.g., 3,000 SAR).

Step 4: Define Asset Type & Depreciation

1. Select the correct Asset Type (this defines useful life & depreciation method).

   • Example: Laptops → 5 years (20% depreciation rate).

2. Set Depreciation Period = Yearly.

3. Set Depreciation Frequency = 12 (monthly).

4. Set Include First Month = Yes

   • Example: If purchased on 25th August, depreciation will start from August itself.

Step 5: Save Asset

1. Click Add to create the asset record.

2. The system will:

   • Generate a Unique Asset Code (e.g., FA000439).

   • Show Quantity in Hand = 0 (since only registration is done, not purchase yet).

✅ Result: The asset is now created in the Asset Master. Once purchased and invoiced, quantity and cost details will be updated automatically.