[et_pb_section fb_built=”1″ custom_padding_last_edited=”off|desktop” _builder_version=”4.27.2″ custom_margin=”0px||0px||false|false” custom_padding=”0px||0px||false|false” custom_padding_phone=”0px||||false|false” locked=”off” global_colors_info=”{}”][et_pb_row column_structure=”1_3,2_3″ _builder_version=”4.27.2″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” width=”100%” custom_margin=”0px||0px||false|false” custom_padding=”0px||0px||false|false” global_colors_info=”{}”][et_pb_column type=”1_3″ module_class=”table-contents” _builder_version=”4.23″ background_color=”#f4f4f4″ custom_padding=”25px||25px||true|false” sticky_position=”top” sticky_limit_bottom=”section” sticky_position_tablet=”top” sticky_position_phone=”none” sticky_position_last_edited=”on|desktop” pac_dcm_carousel_specific_module_num=”0″ border_radii=”on|24px|24px|24px|24px” global_colors_info=”{}” custom_padding__hover=”|||”][et_pb_text _builder_version=”4.23″ text_font=”||||||||” global_colors_info=”{}” background__hover_enabled=”on|desktop”][\/et_pb_text][\/et_pb_column][et_pb_column type=”2_3″ _builder_version=”4.16″ custom_padding=”|||” pac_dcm_carousel_specific_module_num=”0″ global_colors_info=”{}” custom_padding__hover=”|||”][et_pb_text admin_label=”Intro” _builder_version=”4.27.4″ header_2_font_size=”32px” header_2_font_size_tablet=”30px” header_2_font_size_phone=”26px” header_2_font_size_last_edited=”on|tablet” locked=”off” global_colors_info=”{}”]<\/p>\n
Assets are the economic resources your business owns or controls that are intended to provide you with current or potential future financial benefits. They are essential for business operations as they allow companies to produce goods, generate revenue, and stay financially viable.<\/p>\n
Assets represent the foundation of a company\u2019s financial position and are prominently displayed on the company’s balance sheet.<\/p>\n
Read on for the assets definition, as well as a breakdown of the different types of assets and how they are classified and used in financial accounting.<\/p>\n
You can think of an asset as being anything of economic value owned or controlled by a business or individual that is expected to deliver a future benefit. Within the context of a company, assets can be anything from tangible items (e.g. cash and property) to non-physical assets (e.g. intellectual property and goodwill).<\/p>\n
You should care about assets because they are crucial for business success. They:<\/p>\n
Assets are central to the age-old accounting equation:<\/p>\n
Assets = Liabilities + Equity<\/p>\n
[\/et_pb_text][et_pb_image src=”https:\/\/www.reckon.com\/nz\/wp-content\/uploads\/2024\/10\/Assets-Liabilities-Equity-block-asset.png” title_text=”Assets = Liabilities + Equity Block Asset” _builder_version=”4.27.4″ _module_preset=”default” global_colors_info=”{}”][\/et_pb_image][et_pb_text _builder_version=”4.27.4″ _module_preset=”default” locked=”off” global_colors_info=”{}”]<\/p>\n
The above shows that assets, when balanced against liabilities and equity, define a company\u2019s financial position.<\/p>\n
[\/et_pb_text][et_pb_image src=”https:\/\/www.reckon.com\/nz\/wp-content\/uploads\/2025\/04\/Asset-types.png” alt=”Types of assets” title_text=”Asset Types” _builder_version=”4.27.4″ _module_preset=”default” locked=”off” global_colors_info=”{}”][\/et_pb_image][et_pb_text _builder_version=”4.27.4″ _module_preset=”default” locked=”off” global_colors_info=”{}”]<\/p>\n
These are resources expected to be converted into cash, sold or used within a year. Examples of current assets include:<\/p>\n
Also known as long-term assets or non-current assets, fixed assets are resources used over a period longer than one year. Examples include:<\/p>\n
Fixed assets deal with depreciation<\/strong> over time \u2013 in other words, their value gradually reduces with age. Depreciation is a top concept in financial accounting as it can help businesses spread out the cost of an asset over its useful life.<\/p>\n Intangible assets don\u2019t have a physical presence but still deliver real economic value. A few common examples include:<\/p>\n Bear in mind that intangible assets are amortised over their useful life, similar to the depreciation of fixed assets.<\/p>\n These are financial investments that can be easily converted into cash or generate income, including:<\/p>\n Unlike fixed assets, financial assets are more liquid, so they are very valuable for short-term or strategic financial planning.<\/p>\n One way to think about assets is how they give businesses the means to generate revenue and reduce costs. They do this by:<\/p>\n [\/et_pb_text][et_pb_image src=”https:\/\/www.reckon.com\/nz\/wp-content\/uploads\/2025\/04\/Assets-vs-liabilities-2.png” alt=”Assets vs liabilities” title_text=”Assets Vs Liabilities 2″ _builder_version=”4.27.4″ _module_preset=”default” locked=”off” global_colors_info=”{}”][\/et_pb_image][et_pb_text _builder_version=”4.27.4″ _module_preset=”default” locked=”off” global_colors_info=”{}”]<\/p>\n While assets are resources that deliver an economic benefit, liabilities instead represent obligations or debts owed. Think of it in this way:<\/p>\n The relationship between assets and liabilities can be what determines a company\u2019s net worth and financial standing.<\/p>\n Assets are most commonly valued using the concept of historical cost, which is the original purchase price plus any expenses that were required to prepare the asset for use (e.g. delivery or installation fees). However, adjustments like depreciation or amortisation can be applied over time to reflect the latest changes in value.<\/p>\n To maximize the value of their company’s assets, businesses should regularly evaluate their assets\u2019 performance and utility, as well as keep accurate and up-to-date accounting records.<\/p>\n It\u2019s worth investing in accounting software to streamline asset tracking and reporting, and to make sure there\u2019s a system in place for the proper classification of assets for tax and financial reporting purposes.<\/p>\n Ultimately, assets are the building blocks of any business\u2019s financial foundation. They are the resources needed for daily operations and future growth, and will have a huge bearing on a company\u2019s success or failure.<\/p>\n [\/et_pb_text][et_pb_text admin_label=”Related terms” _builder_version=”4.27.4″ header_2_font_size=”32px” header_2_font_size_tablet=”30px” header_2_font_size_phone=”26px” header_2_font_size_last_edited=”on|tablet” locked=”off” global_colors_info=”{}”]<\/p>\n See related terms<\/strong> <\/p>\n [\/et_pb_text][ba_social_share icon_bg=”#03002e” icon_padding=”10px|12px|10px|12px|true|true” layout=”classic” show_text=”off” btn_padding=”0px|0px|0px|0px|false|false” btn_bg_color=”RGBA(255,255,255,0)” _builder_version=”4.23″ _module_preset=”default” custom_margin=”50px||||false|false” custom_padding=”25px||||false|false” custom_css_before=” content: %22SHARE THIS%22;|| font-size: 16px;|| font-weight: 700;|| line-height: 22px;|| letter-spacing: 0em;|| text-align: center;|| color: #ff5447;|| margin-bottom: 10px;|| display: inline-flex;|| position: absolute;|| margin-top: 10px;” border_width_top_main=”1px” border_color_top_main=”#e4e4e4″ border_radii_icon=”on|5px|5px|5px|5px” global_colors_info=”{}” custom_css_before_last_edited=”off|desktop”][ba_social_share_child _builder_version=”4.23″ _module_preset=”default” global_colors_info=”{}”][\/ba_social_share_child][ba_social_share_child network_type=”facebook” _builder_version=”4.23″ _module_preset=”default” global_colors_info=”{}”][\/ba_social_share_child][ba_social_share_child network_type=”linkedin” _builder_version=”4.23″ _module_preset=”default” global_colors_info=”{}”][\/ba_social_share_child][ba_social_share_child network_type=”email” _builder_version=”4.23″ _module_preset=”default” global_colors_info=”{}”][\/ba_social_share_child][\/ba_social_share][\/et_pb_column][\/et_pb_row][\/et_pb_section]<\/p>\n","protected":false},"excerpt":{"rendered":" Assets are the economic resources your business owns or controls that are intended to provide you with current or potential future financial benefits. They are essential for business operations as they allow companies to produce goods, generate revenue, and stay financially viable. Assets represent the foundation of a company\u2019s financial position and are prominently displayed […]<\/p>\n","protected":false},"author":28,"featured_media":0,"menu_order":0,"template":"","meta":{"_et_pb_use_builder":"on","_et_pb_old_content":"","_et_gb_content_width":"","inline_featured_image":false,"_lmt_disableupdate":"no","_lmt_disable":"","footnotes":""},"class_list":["post-289735","glo","type-glo","status-publish","hentry"],"yoast_head":"\n3. Intangible assets<\/h3>\n
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4. Financial assets<\/h3>\n
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How assets add value to a business<\/h2>\n
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Assets vs liabilities<\/h2>\n
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Valuation of assets<\/h2>\n
Examples of business assets<\/h2>\n
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Major considerations for managing assets<\/h2>\n
What is an expense?<\/a>
What is capital?<\/a><\/p>\n