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In business and accounting, an asset is an economic resource that can be controlled by somebody (a person or an organization). They are created because of past transactions or events and they may help in obtaining future economic benefits.
There are two types of assets:
- tangible assets
- Fixed assets such as buildings, equipment etc.
- Current assets such as inventory
- Intangible assets e.g. goodwill, patents, trademarks, copyright, computer programs
Assets have three important characteristics:
- They can provide a future benefit to contribute directly or indirectly to future net cash flows, and, in the case of not-for-profit organizations, to provide services;
- The entity can control access to the benefit; and,
- The transaction or event which created the asset has already occurred.