Business assets

Tangible assets are any assets in your business that have a physical form. They include fixed assets such as machinery, building and land, and current assets such as inventory and cash.

What are tangible assets?

Tangible business assets are items with a clear purchase value that your business uses to operate, produce goods and services, or create profit. Tangible assets can be short-term or long-term. They generally fall under two main categories:

• financial capital
• physical equipment, systems and infrastructure

Examples of tangible assets may include:

• cash and cash equivalents
• your business premises, property or land
• company vehicles
• machinery and equipment
• IT equipment
• investments
• any payments owed to you
• stock-in-hand and the value of any confirmed orders

Businesses can also have non-physical assets such as goodwill, brand and intellectual property. These are known as intangible assets.

Tangible asset valuation

Tangible assets are the backbone of your company. They represent much of your company's worth but are generally not for sale to customers. You can use tangible assets:

• to provide goods or services
• to contribute to your business' cashflow
• to raise cash in case of emergencies
• to meet your business objectives and goals
• as collateral for loans

Find out more about business asset valuation.

Managing tangible assets

To make the most of them, you should track and manage all tangible assets in your business. For accounting purposes, record all fixed assets on your balance sheet and account for depreciation – this spreads costs over their useful life. See more on depreciation of assets.

Track tangible assets with inventory software to monitor location, quantity, condition and maintenance needs. Effective tracking can prevent loss of assets (through theft of damage), support audit and aid business asset valuation. See more on managing assets in business. Consider insuring or putting security measures in place to protect your valuable assets.