Asstttttt Mgemt

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Asset Management

What is Assets?
Buildings

Machinery

Tools

ASSETS
Vehicles

Buildings

Furniture

What is Assets Management?


The asset management approach incorporates the economic assessment of trade-offs among alternative investment options and uses this information to help make cost-effective investment decisions. Asset management has come of age because of changes in the transportation environment, changes in public expectations, and extraordinary advances in technology.

Need for Asset Management


Increased demand for better roads, bridges, sidewalks, lights and improved sewer & water systems.
Higher standards for safety & health.

Environmental protection concerns.


Regulations.

Growth and development of infrastructure.

How to measure?
1.

2.
3.

Net profit margin Asset turnover Financial leverage

Net profit margin

1.

Net profit margin= net profit after taxes


Net sales

Asset turnover

Asset turnover =

Net sales
Total Assets

Financial leverage

Financial leverage =

Total sales
Net worth

Key business ratio


1. 2. 3. 4. 5.

Quick ratio Current ratio Collection period Accounts payable to net sales Overall gross profit

Benefits of Asset Management?

Facilitates the establishment of policy objectives & related measurement of performance. Avoids problems & potential crisis. Provides better & consistent levels of service for public. Reduces life cycle costs.

Key principle of Assets Management


1. 2. 3.

4.
5.

Strategic & proactive in approach. Places a premium on data, information, collaboration and interdisciplinary management. A long term and comprehensive view of infrastructure performance and cost. An explicit, visible, and transparent approach requiring effective communication among all stakeholders. A business case involving investment choices that are policy driven with tradeoffs among competing priorities.

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