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WorksheetsModule 2: Asset Management System (AMS)
Total questions: 28
Worksheet time: 9mins
What is an Asset Management System (AMS)?
A software used only for financial reporting
A method a company uses to manage all its assets across the organisation
A system focused only on physical equipment
A process used only by large organisations
Which of the following best describes assets within an AMS?
Only buildings and machinery
Only financial and monetary resources
Both tangible and intangible items essential to business operations
Only inventory and raw materials
Which of the following is an example of an intangible asset?
Buildings
Inventory
Software
Vehicles
How does asset management vary between companies?
It is the same for all organisations
It depends on international regulations
It varies from company to company
It applies only to public enterprises
For an asset management system to be effective, it must:
Focus only on high-value assets
Allow control over all elements of business assets
Be used only by asset managers
Track only financial data
Does company size affect the need for an asset management system?
Yes, only large companies need it
Yes, only small companies need it
No, company size makes no difference
Only multinational companies need it
What is required to stay in control of assets effectively?
Annual asset reporting
A correct and real-time asset tracking system
Manual inventory checks
Outsourcing asset management
What is a major risk if assets are not properly tracked?
Increased employee turnover
Loss of market share
Wasting time and money
Higher production quality
How does asset management help a firm account for its assets?
By removing low-value assets
By simplifying employee reporting
By tracking where assets are and how they are used
By eliminating financial audits
What is a benefit of knowing whether assets have been modified?
Reduced staffing costs
Improved marketing strategies
More efficient asset recovery and higher returns
Increased sales revenue
How does asset management help with amortisation rates?
By eliminating depreciation
By ensuring assets are regularly checked and properly recorded
By increasing asset values
By avoiding financial statements
What role does asset management play in risk management?
It transfers risk to insurers
It eliminates all risks
It identifies and manages risks related to assets
It focuses only on safety risks
What are “ghost assets”?
Assets under warranty
Assets leased from third parties
Assets lost, stolen, or damaged but still recorded in inventory
Assets with low utilisation
How does a strategic asset management plan address ghost assets?
By depreciating them faster
By selling them
By identifying and removing them from the books
By transferring them to another department
What is the first step in how asset management works?
Creating financial reports
Appointing an asset manager
Disposing of obsolete assets
Installing tracking technology
Who is responsible for creating an effective asset management plan?
The finance department
External auditors
The appointed asset manager
Human resources
Asset management should consider which of the following?
Only acquisition costs
Only disposal processes
The complete lifecycle of an asset
Only maintenance activities
Which example best illustrates the asset lifecycle approach?
Purchasing office furniture
Leasing a vehicle
Managing a laptop from acquisition to disposal
Hiring personnel
Why do organisations use an Asset Management System?
To increase employee performance only
To reduce expenditures related to acquiring, maintaining, and operating assets
To replace financial planning
To eliminate asset ownership
Which technologies can be used to track assets?
Barcode scanners only
GPS and RFID
Financial software
Cloud storage systems
Why is tracking vehicles and equipment important?
To comply with marketing requirements
To ensure all assets are used correctly and efficiently
To reduce employee workload
To increase asset depreciation
What is the first step in developing a Strategic Asset Management Plan?
Setting service levels
Computing life-cycle costs
Completing an asset inventory
Long-term financial planning
Which information should be included in an asset inventory?
Only asset value
Only asset location
Total count, location, value, acquisition date, and lifecycle
Only anticipated lifecycle
Why must life-cycle costs be computed?
To focus only on purchase price
To ignore maintenance expenses
To account for all costs over an asset’s life
To reduce asset lifespan
What does setting levels of service involve?
Reducing asset usage
Defining capacity, quality, and role of asset services
Eliminating maintenance activities
Increasing asset purchase rates
Why is long-term financial planning important in asset management?
To avoid asset inventories
To determine achievable goals and priorities
To eliminate renewal activities
To shorten asset life cycles
How does asset management improve acquisition and use?
By increasing asset purchases
By tracking assets throughout their lifecycle
By focusing only on disposal
By outsourcing asset control
Why do organisations maintain asset information in a central database?
To reduce asset value
To simplify reporting and ensure compliance
To eliminate audits
To decentralise asset control
