Fixed assets sometimes also known as property or wealth is a term which is used to represent assets which cannot be immediately converted or used as cash.

It can be described as something akin to current assets like bank accounts which are known as liquid assets. Therefore only tangible assets can be referred as fixed assets.

A fixed assets cannot be sold directly to a buyer or a firm or consumer. A banks current assets can be described as an inventory just like a store of iron in a warehouse and the value of sales owed to the firm through credit to debtors or money receivable, and the cash reserves of the bank all can be described as fixed assets. The other non -current assets could be the furniture in the bank,vehicles attached to the bank for transportation, cash registers all comes under this category. The non-current assets are not sold to customers.

Fixed assets are items of value which are purchased by an organization and will be used by the organization for a lengthy period of time.

These fixed assets include  land and  buildings, motor vehicles, furniture, office equipment, computers, fixtures and fittings, and plant and  machinery. Fixed assets are charged lower taxes because the value of Fixed assets can go down because its value can go down due to deprecation Hence fixed assets are assets for any organization and the benefits accrued from it can be acquired by the organization. The costs of such assets can be be easily assessed after deducting the value of deprecation.

While deciding the price of a fixed assets different factors and expenses are taken into account like installation charges, transportation charges, dismantling and removing the assets for sales when the asset is no longer needed. All these winding up expenses are also taken into account.

In any corporate house the sole motto is to earn profits and contribute to the kitty of the company. For achieving this goal the basics of accounting is what is commonly known as Matching Concep must be applied. It is basically a comparison of the expenses in particular period of time with the earnings of the company in the same period.

Fixed Assets take a long time to generate revenue. The period can vary anywhere between one to two years which is a long period. Therefore allowance for deprecation must be made for the period of time. Deprecation can be described as the expense generated by an asset while giving profits. It is matched with the revenue generated through the asset. This is essential for calculating accurately the net income of the corporate house. The net value of any asset is the difference between the historical value and the deprecation amount. Therefore it should be informed to the person who is a potential investor and is willing to purchase the asset.It is enshrined in Standard Accounting Statement (SAS) 3 and IAS 16 that value of asset should be carried at the net book value.