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What Are Assets in Accounting? Types & Examples (Updated 2027)

Learn what assets are in accounting, their main types, Swiss SME examples, and how they are recorded and valued under Swiss rules.

Finance d'entreprise

Table of contents

Introduction
What Are Assets in Accounting?
The Main Types of Assets in Accounting
Asset Examples for Swiss SMEs
How Assets Appear on a Swiss Balance Sheet
How Swiss Businesses Record and Value Assets
Assets vs Liabilities and Expenses
Why Asset Accounting Must Be Accurate
Common Asset Accounting Mistakes
FAQ

Introduction

So, what are assets in accounting? Assets are resources a business owns or controls that are expected to provide future economic value. They include cash, unpaid customer invoices, inventory, equipment, vehicles, property, and certain intangible resources.

Assets appear on the balance sheet and show how a company has used its available capital. Recording them correctly helps a Swiss business understand its liquidity, financial health, and overall value. This guide from the Fiduciaire Vaudoise Blog explains the main types of assets, with practical examples for Swiss SMEs.

What Are Assets in Accounting?

In accounting, an asset is a resource that can help a business generate income, reduce costs, settle obligations, or support future operations.

An asset does not always need to be a physical item. Cash and machinery are assets, but so are accounts receivable, acquired software, patents, and licences.

When Does a Resource Count as an Asset?

Under Article 959 of the Swiss Code of Obligations, a resource should be recognised as an asset when:

It results from a past event, such as a purchase or completed sale.
The business owns or controls it.
A future inflow of funds is probable.
Its value can be reliably estimated.

For example, when a consulting firm completes a CHF 10,000 project and issues an invoice, the amount becomes an account receivable. It is an asset because the firm has earned the right to receive payment.

What Does Not Count as an Asset?

Something may be valuable without qualifying as an accounting asset. Examples include:

Expected sales that have not yet occurred
Employees’ knowledge and skills
A positive reputation built internally
Personal property not used by the business
Routine costs with no future economic benefit

These items are usually excluded because the business does not control them fully or cannot measure their value reliably.

The Main Types of Assets in Accounting

Assets can be classified in several ways. The most important distinction on a Swiss balance sheet is between current and non-current assets.

1. Current Assets

Current assets are expected to be sold, collected, consumed, or converted into cash within 12 months or the company’s normal operating cycle.

Common examples include:

Cash and bank balances
Trade receivables
Short-term investments
Inventory
Unbilled services
Prepaid expenses
Accrued income

Current assets help a business fund daily operations and pay short-term obligations. A company may be profitable but still face cash flow problems if too much of its current assets is tied up in unpaid invoices or slow-moving inventory.

2. Non-Current or Fixed Assets

Non-current assets, also called fixed or capital assets, support the business for more than one accounting period. They are usually acquired for long-term use rather than immediate resale.

Examples include:

Land and buildings
Machinery
Company vehicles
Computers and office equipment
Long-term financial investments
Patents and licences
Acquired software

Most fixed assets lose value through use, age, or obsolescence. Their cost is therefore allocated over their useful life through depreciation or amortisation.

3. Tangible Assets

Tangible assets have a physical form. They include buildings, vehicles, machinery, office furniture, computers, tools, and inventory.

A tangible asset can be current or non-current. Inventory is a current tangible asset, while production equipment is a non-current tangible asset.

4. Intangible Assets

Intangible assets have no physical form but can still create long-term value. Common examples are patents, licences, trademarks, acquired software, and purchased goodwill.

However, not every internally created intangible resource can be recorded. A strong brand or loyal workforce may be valuable, but its cost and future benefit can be difficult to measure reliably.

5. Operating and Non-Operating Assets

Operating assets support the company’s main activities. They may include inventory, equipment, receivables, and the cash needed for daily operations.

Non-operating assets are not essential to the core business. Examples include unused land, surplus cash, or an investment unrelated to normal operations. This is mainly a management classification rather than the minimum legal structure used on a Swiss balance sheet.

Asset Examples for Swiss SMEs

The assets held by a company depend on its industry and operating model.

Swiss business	Common assets
Consulting firm	Cash, receivables, computers, software licenses
Retail business	Inventory, cash, card receivables, shop equipment
Construction company	Vehicles, tools, machinery, unfinished work
Technology company	Cash, servers, acquired software, patents
Property company	Land, buildings, rental receivables

Consulting firm

Common assetsCash, receivables, computers, software licenses

Retail business

Common assetsInventory, cash, card receivables, shop equipment

Construction company

Common assetsVehicles, tools, machinery, unfinished work

Technology company

Common assetsCash, servers, acquired software, patents

Property company

Common assetsLand, buildings, rental receivables

Asset examples

A service company may own few physical assets but hold significant receivables. A manufacturer, by contrast, may have much of its capital invested in machinery and inventory.

How Assets Appear on a Swiss Balance Sheet

A balance sheet shows a company’s financial position on a specific date. Assets appear on one side, while liabilities and equity explain how those assets were financed.

The Accounting Equation

Every balance sheet follows the same formula:

Assets = Liabilities + Equity

If a company buys a CHF 30,000 vehicle using a bank loan, both its assets and liabilities rise by CHF 30,000. If it buys the vehicle with cash, one asset increases while another decreases.

Read more about how the accounting equation connects daily transactions to the balance sheet.

The Swiss Balance-Sheet Structure

Under Article 959a of the Swiss Code of Obligations, assets are divided into current and non-current assets. They are generally listed in decreasing order of liquidity. Cash appears first, followed by receivables, inventory, and long-term assets.

The Swiss government’s model company balance sheet shows how this structure works in practice.

How Swiss Businesses Record and Value Assets

Initial Asset Recognition

An asset is generally recorded at no more than its acquisition or production cost. Depending on the purchase, this may include:

Purchase price
Transport and delivery
Installation
Direct production costs
Costs required to prepare the asset for use

For example, the recorded cost of machinery may include both its purchase price and the cost of installing it.

Depreciation and Amortisation

Depreciation allocates the cost of a tangible fixed asset across its useful life. Amortisation applies a similar approach to intangible assets.

A company vehicle will usually be depreciated over several years rather than treated as one large expense at the date of purchase. Land is generally not depreciated because it does not have a limited useful life.

These entries form part of the wider double-entry accounting process.

Impairment and Valuation Adjustments

An asset’s carrying value may need to be reduced when:

Equipment becomes damaged or obsolete.
Inventory cannot be sold at its recorded value.
A customer is unlikely to pay an invoice.
An intangible asset no longer provides the expected benefit.

Swiss accounting follows the principle of prudence. Assets should not be overstated in a way that makes the company appear financially stronger than it is.

Assets vs Liabilities and Expenses

These three accounting terms have different meanings:

Item	Meaning	Example
Asset	A resource that provides future value	Company vehicle
Liability	An amount the company owes	Vehicle loan
Expense	A cost consumed during the period	Vehicle fuel

Asset

MeaningA resource that provides future value

ExampleCompany vehicle

Liability

MeaningAn amount the company owes

ExampleVehicle loan

Expense

MeaningA cost consumed during the period

ExampleVehicle fuel

Explanation of accounting terms

Buying machinery normally creates an asset because it will support the business for several years. Paying for routine maintenance usually creates an expense because the benefit is consumed in the current period.

Why Asset Accounting Must Be Accurate

Reliable asset records help Swiss SMEs:

Monitor liquidity and working capital
Prepare accurate annual accounts
Calculate depreciation and taxable profit
Support loan and investor applications
Plan equipment replacements
Prepare for audits and due diligence
Assess the company’s financial value

Assets should not be reviewed in isolation. Owners should consider them alongside liabilities, equity, revenue, expenses, and cash flow when they read a financial report.

Common Asset Accounting Mistakes

Incorrect asset records can overstate a company’s financial strength, distort taxable profit, and make the balance sheet less reliable. Swiss SMEs should watch for these common mistakes.

1. Recording Fixed Assets as Immediate Expenses

Equipment, vehicles, or computers that provide value for several years should normally be recorded as fixed assets. Treating the full purchase as an immediate expense may understate both profit and total assets in the year of purchase. The cost should instead be allocated over the asset’s useful life through depreciation.

2. Capitalising Routine Operating Costs

The opposite mistake is recording everyday expenses as assets. Routine repairs, maintenance, rent, and subscriptions normally benefit the current period and should be treated as expenses. Capitalising them may overstate the company’s assets and profit.

3. Failing to Record Depreciation or Amortisation

Most fixed assets lose value as they are used or become outdated. If depreciation or amortisation is not recorded, the balance sheet may show an unrealistic asset value. Businesses should review useful lives, depreciation methods, and residual values regularly.

4. Keeping Obsolete Inventory at Its Original Value

Damaged, outdated, or slow-moving inventory may no longer be worth its recorded cost. Keeping it at the original value overstates current assets and can hide operational problems. SMEs should perform regular stock counts and apply valuation adjustments where needed.

5. Ignoring Doubtful Receivables

An unpaid invoice remains an asset only when collection is reasonably likely. Long-overdue or disputed invoices may require a bad debt allowance or write-off. Otherwise, accounts receivable and short-term liquidity may appear stronger than they are.

6. Mixing Personal and Business Assets

Personal vehicles, computers, or property should not be recorded as company assets unless they belong to the business or are properly transferred to it. Mixing private and business resources can create inaccurate accounts and tax complications.

7. Failing to Maintain a Fixed-Asset Register

Without an updated register, a business may continue depreciating assets that have been sold, lost, or discarded. The register should include each asset’s purchase date, original cost, useful life, depreciation, location, and disposal date. This creates a clear record for annual closing and audits.

FAQ

Current assets are expected to be realized within 12 months or the normal operating cycle. Fixed assets support the business over a longer period.

Manage Your Business Assets with Confidence

Fiduciaire Vaudoise helps Swiss SMEs maintain reliable asset records, prepare compliant annual accounts, and turn financial data into useful business insights.