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How do you determine the current value of your  IT assets, not replacement costs but actual current value...

Posted on 2006-07-15
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Last Modified: 2010-04-26
I am needing to determine the value of all of our IT Hardware and software. This is not replacement value but current actual value, taking into consideration the age of equipment, wiring, software etc. Is there an "easy" way to do this, perhaps a formula of some sort. This is a first for me. Frankly, I find replacement costs much easier to determine. Any ideas will be appreciated. Unfortunately I need this assistance as soon as possible as I am working on this project as we speak. J
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Question by:jstilgen
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GinEric earned 2000 total points
ID: 17115081
Under IRS rules:

Find Class Life Asset

Inventory all of your equipment and assing each a Class Life.

Start with the purchase price and use the depreciation method for Class Life Assets.

For example, if your company has depreciated them over the last three years with a Class Life Asset deduction, find those accounting records and the remaining value at the end of this year is their value.

Generally, if a 5 year life, by this third year the value will be less than 40% of the cost [purchase price].

Once you depreciate equipment, you have to stick with that method of depreciation.  The methods are generally life/years, Sum of the Years Digits, and a few others.  Sum of the Years Digits gives the maximum depreciation for a Class Life Asset.  life/years is a simple percentage deduction per year.

Call accounting and get the figures.  If you don't have accounting or the company has not depreciated this equipment, you have a problem, more ways than one.

The formulae are available at the IRS site.  The figures are available at your accounting department.
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Author Comment

by:jstilgen
ID: 17115131
Thanks for the answer, I only wish I was smart enough to understand the IRS info :) I will get our bean counter involved and we will get this done. Again thanks for your answer, I appreciate it! J
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LVL 12

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by:GinEric
ID: 17142775
You're welcome.  Let me know how you make out.
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