What are assets?

An asset is any resource with financial value that is controlled by your company. There is a broad range of assets that your business may own, create, or benefit from, including property, office equipment, tools, vehicles, investments, patents, inventory, and so on. Accounts receivable, cash, and loans provided to owners or employees are also considered an asset.⁠
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Your Balance Sheet will list all your company’s assets and will explain how they are financed, i.e., whether through debt, equity, or owned outright. ⁠
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Because assets add value to your business over an extended period of time, processes called depreciation and amortization are used to spread the cost of the asset throughout its useful life. This means that you will receive a tax deduction for the purchase over multiple years.⁠
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This is different from a standard business expense where the total amount of the purchase is recognized immediately, will appear on the debit side of your Profit & Loss report, and be written off in full during that tax year.⁠
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