DESIGN AND IMPLEMENTATION OF A FIXED ASSET MANAGEMENT INFORMATION SYSTEM (A CASE STUDY OF UNITED AFRICAN COMPANY OF NIGERIA (UACN) DEVELOPMENT COMPANY PLC LAGOS)

CHAPTER ONE

INTRODUCTION

Fixed asset management information system is a sub-operation in financial accounting that take care of the degeneration of asset usefulness because of this responsibility. Asset management and depreciation is very important in any organization.

Asset management and deprecation is a content of every balance sheet and then proper attention should be given on how asset are depreciated to provide complete and accurate information that will assist management in planning and policy making.

This is why it is important to design a fixed assed management information system

STATEMENT OF THE PROBLEM

          To determine the fixed asset value and depreciation in every organization has been a problem.

          Hence, there are limited number of staff working in the account department which makes the existing asset account to be delegated to some staff by their departmental heads at the end of each period. The handling of Asset Account by numerous staff creates positing error omission error and inaccurate calculated results.

          Apart from that, there is no adequate record storage and disposal system which resulting in non-documentation of some existing asset are as well as continuous recording of scrapes. However, the method of asset depreciation being used in the existing system is ineffective.

          Infact, the researcher shall by the end of this project provide a suitable solution to the pressing problems of fixed asset value and depreciation.

PURPOSE OF THE STUDY

          The fixed asset management information system is cost effective and provides an interactive environment, makes job easier and simpler. Thus it will help the organization to know the various assets she have if location useful and non-useful ones, accurate recording of these assets and moreover assist them in planning and decision-making.

          This will help the company in project allocation and proper accountability. Furthermore this project work will serve as a reference to both private and public organizations who are researching in this area and others that will appreciate benefit of automation.

AIMS AND OBJECTIVES

          The objective of this project is to design a fixed asset management information system that will curb the problems and malpractices of the existing system. This automatic software facilities online recording and modifying of assets using electronic keyboard. It also enhances automatic depreciation of an asset, proper storage and speedy retrieval any asset value. However, the computerized system will provide management with various reports on depreciation expenses and accumulated depreciation at the end of every period. Hence a graphic operating environment is incorporated to the system so that the software will be easy to use and maintain.

SCOPE

          This project mainly focuses on tangible asset of the company, via land, building, machinery vehicle and furniture. Although land is not depreciated due to its continuous nature, other fixed assets category depreciates and its depreciation depends strongly on the estimated life span of asset.

          Moreover, all the acclaimed expenses that increases the cost of the asset are recorded in the estimated cost of the asset. This is made possible using modified submenu.

LIMITATIONS

          This project is limited only to the account section (ACITD) of the organization because it will be tedious to incorporate other activities of fixed asset into this work considering time and resources.

          Also, the limited staff in the accounts section have little or no knowledge of electronic data processing and this is a hindrance.

          Numerous parameter have seriously hindered the realization and full implementation of this project mostly is money, inadequate this software since the account department do not have the system support.

ASSUMPTION

          Generally, it is believed in this project that fixed asset continue, depreciating until it have completed its estimated life span. Meanwhile the asset stops depreciating once the book value is equal to or less than the scrape value and it is not useful to the organization and must be disposed.   

          It is also hoped that the result of this project will further contribute to a suitable practical basis of operation for fixed asset depreciation.

DEFINITION OF TERMS

It is important to define some basic terms used in this project.

FIXED ASSET:   These are long term asset that are used in a firm to provide goods and services over a period of one year.

MANAGEMENT INFORMATION SYSTEM (MIS):     It defines as a programme, which accesses internal (human resources, marketing accounting, production research) records to generate reports to the various levels of information.

BOOK VALUE: This is the estimated cost of the asset less total accumulated depreciation and condition ready for use.

ACCELERATED DEPRECIATION: Method of depreciation that records higher amounts of depreciation in the early years of an asset life and lower amount in later years.

ACCUMULATED DEPRECIATION: A contra account that accumulates the depreciation taken on asset over its useful life.

CAPITAL EXPENDITURE: Expenditure that are debited to an account to an accumulated depreciation account.

CONTRACT ACCOUNT: An account with a balance opposite normal balance.

COMPUTER HARDWARE: The major electronic component in a computer system and other peripheral attached to it.

DATA FLOW: Graphic representation and analysis of data movement processing transformation functions and data store.

DEPRECIABLE COST: This is the asset estimated cost less estimated storage.

DEPRECIATION: The allocation of cost of an asset over it useful economic life.

ESTIMATED COST: This is the acquisition cost plus other expenses that increases the asset value.

FILE: A collection of related records stored in a specific sequence.

IMPLEMENTATION: Consist of the design and installation of new system and the removal of the current system.

INPUT: The raw data, raw material, paper work, computer file, the energizing element that puts the system into operation.

MICRO-COMPUTER: A small relatively in expensive computer that is design to be used by individual at their own desk.

OUTPUT: The end product of the area under study. It can processed computer file.

PASSWORD: A unique word or string of characters that a program computer user must supply to meet security requirement before gaining access to the program or data.

SALVAGE VALUE: This is the appraisal scrape value of an asset.

SOFTWARE: The program control the operation of the computer.

STORAGE DEVICE: The various device whereby data and instruction are stored for immediate or future use.