Manage Physical Assets: Business Activities, Acquisition, Maintenance Regime, and Issues

This report covers the business activities, acquisition, and maintenance regime of physical assets in the hospitality, tourism, and event management sectors. It also discusses the issues related to maintenance, workplace health and safety, and disruptions in maintenance.

Manage physical assets
Task 2Assessment Task
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Table of Contents
INTRODUCTION...........................................................................................................................3
PART A...........................................................................................................................................3
1. Overview of the business activities about the physical assets ...........................................3
2. Explaining the purpose of acquisition or replacement of physical assets .........................3
3. Determining the requirements of each physical asset in terms of various parameters.......3
4. Prices and quotes received from different suppliers for the specific assets.......................4
5. Contacting financial institutions and knowing various options for financing ...................5
6. Calculation of finance variants and determination of best option for each asset...............5
7 Processes required to finalise the acquisition of each asset ...............................................5
PART B............................................................................................................................................6
1. Preparation of hotel asset register.......................................................................................6
2. Preparation of asset register ...............................................................................................7
PART C............................................................................................................................................7
1. Framing maintenance regime for the physical assets.........................................................7
2. Maintenance regime of various assets................................................................................7
CONCLUSION..............................................................................................................................10
REFERENCES .............................................................................................................................11

INTRODUCTION
Physical assets are the necessary pieces of machinery, equipment or tool to conduct the
operations of the business. It is required to carry out the activities of the organisation. This report
contains three different sectors which are hospitality, tourism and event management companies.
It also encompasses the activities of companies, the purpose of using specific physical assets and
selecting assets based on various parameters(Ann Wheeler and Garrick, 2020). This also includes
the maintenance strategies, feedback from customers and staff and preparation of asset and
maintenance registers.
PART A
1. Overview of the business activities about the physical assets
In the context of the hospitality sector, the company chosen is Bentley restaurant &
company. It offers Upscale Modern Australian cuisine with industrial interior design.
Concerning the tourism sector, the organisation taken is Intro travel. It is serving for many years
by fulfiling people desire to travel, explore and connect with ethnic taste. The event management
company taken is Perfect story wedding. It turns the dreams of its clients into reality by making
their day as memorable and lavish.
2. Explaining the purpose of acquisition or replacement of physical assets
In the hospitality sector, an organisation is required to use equipment fixtures, fittings and
furniture. For the smooth running of Bentley restaurant & bar, NSW requires assets to set up the
ambience. Another sector is tourism; it is necessary to have vehicles(de Vet and Eriksen, 2020).
In this industry, it is crucial for Intro travel to move from one place to another. In the industry of
events, it mainly needs gardens to arrange marriages, birthday parties and various social
functions.
3. Determining the requirements of each physical asset in terms of various parameters.
Industry Asset Performance Size Location Maximum
budget
Hospitality Commercial
Kitchen
Able to contain all
the required
kitchen appliances
1051 square
feet
Bentley
restaurant &
bar, Sydney,
Lease
amount of
5600 AUD
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Australia for a
quarter.
Event
Industry
Garden Able to hold 400
guests at a time
3200 square
feet
Brisbane
QLD,
Australia
25600 AUD
Tourism Vehicles (Bus) Able to travel 70
Km in an hour
20 Seats Sydney,
Australia
10000 AUD
4. Prices and quotes received from different suppliers for the specific assets
Suppliers providing price quotations for Tourism based equipments :
Tourism (Bus) (I) Daniel (II) Ramus (III) Harry
Headlight 1500 1250 1550
Seat 1000 1500 2500
Bumper 1250 1580 1600
For tourism business, the price quotation offered by supplier Daniel will be considered
suitable. The reason is it is providing equipment such as seats and bumpers at lower prices in
comparison to other suppliers(Grafton and Wheeler, 2018). Ramus will be booked for supplying
headlight because it is providing it at the least possible prices among others.
Suppliers providing price quotations for Hospitality based equipment:
Hospitality
event(Commercial
Kitchen)
(I) Renaldo (II) David (III) Stephen
Oven 2500 3000 3500
Freezer 15000 20000 25000
Mixers 1300 1560 1800
For hospitality cause supplier Renaldo would be chosen since it is providing all
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equipment required for commercial kitchen at lower prices than others present in the
market(Robins, 2018).
Suppliers providing price quotations for Garden-based types of equipment:
Garden (I) Damon (II) Patrick (III) Ron
Spade 1350 2500 2200
Shovel 1600 1680 1700
Rake 1240 1650 1450
For choosing the best equipment useful for the garden area, a price quotation provided by
Damon would be chosen.
5. Contacting financial institutions and knowing various options for financing
A financial institution such as banks and non-banking finance companies can be
contacted for borrowing, managing funds and getting equipment on a credit basis as well. A
financial institution that would serve as a helping hand for the company would be the Bank of
UK which can help in managing operational work of restaurant, tourism, commercial kitchen and
garden as well(Wolfenden and et.al., 2019). Two suppliers which can be helpful for lending
equipment on credit can be Renaldo and Damon because they are given priority among other
available suppliers.
6. Calculation of finance variants and determination of best option for each asset
Finance variants offered are Fixed-rate mortgage, preventive maintenance and
Depreciation. The best variant considered is the diminishing value method which would help to
find the disposal value of the asset.
Factors that affect the assessment of depreciation value are salvage value, cost of the
asset. It is a factor that affects the value of an asset over a period considering changes in
technology and what would be financial impacts on restaurants as well. It helps to understand the
exact value.
7 Processes required to finalise the acquisition of each asset
Details for detailed specifications: Detailed specifications specify the standards which
are set by industries and businesses which explains the boundaries in which it has to be operated.
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The specification can be defined as qualitative measures taken by restaurants for serving food up
to the mark in comparison to other competitors, in the case of the event sector it can be explained
as managing activities according to expectations and needs of clients. It specifies details that
must be given utmost priority for carrying out operations well in time and define what has been
considered in the process as well.
Legal contracts: Legal contracts can be explained as legal formalities which every
business type must fulfil before starting a business. In the case of restaurants, it focuses on
positive impacts on the environment and society, health and safety as well. In case of the event,
the legal formalities include processing of payments, termination clauses.
Requirements and documentation applicable to different acquisition and financing
methods: Certain methods are helpful in the case of acquisitions such as processing loans from
banks, finding private lenders for money. Documentation needed by every lender is their credit
score and their ability to pay back and documentation are the assurance of recovering debts in
case the creditor fails to pay(Whiteside, 2020).
Preparing documents for disposing of assets that are being replaced including tax
obligation: Diminishing return is being considered useful by the company for better operations
and functioning of restaurants in the market. It is thus explained as preparing documents for
assets that have not been fully utilised and how they can be set off with the help of certain
accounts.
PART B
1. Preparation of hotel asset register
Asset
Descripti
on
Model Serial
number
Purchase
cost
Date
Purchased
Location Current
Value
(If Known)
Land 2009 p-456 116000000 10/02/18 Canberra 146000000
Building 2010 k-553 105000000 15/05/20 Sydney 125000000
Machine
ry
2011 u-998 550000 12/06/19 Perth 450000
equipme
nt
2012 h-255 350000 13/07/21 Hobart 200000
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Furnitur
e
2013 k-855 210000 14/08/21 Darwin 105000
Vehicles 2014 m-987 100000 22/09/20 Newcastle 85000
Inventor
y
2015 b-250 75000 30/12/21 Albany 62000
2. Preparation of asset register
Asset
Description
Serial
number
Maintenance
requirement
Maintenance
schedule
Responsible
Coffee
Machine
A147-
Yf54
Clean the steam wand,
full backflush, Clean the
draining hose, clean the
portafilters, filter basket,
and drip tray, check the
water filter
Daily Barista
Microwave
oven
p457-
pp9
Replacing gasoline,
cleaning burners and
racks
weekly Oven cleaner
Refrigerator u855-
ou9
Cleaning coils,
maintaining the correct
temperature
monthly Cleaning agent
Beds/sofas l90-kj7 Vacuum regularly,
polishing
Yearly Carpenter
pool b77-vo9 filters, vacuum and
preventing bacteria
weekly Colloquially
Fitness
equipment
f90-lo8 Disinfectant wipes for
machines
Daily cleaner
PART C
1. Framing maintenance regime for the physical assets
Asset tools used corrective action
Microwave oven Sturdy towel, screwdriver and nut
driver
Temperature is stabilised and
reheating of food items is
corrected.
Bus Bumper, seat covers, engine oil Increased speed and ability to
cover more distance in one km per
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hour.
2. Maintenance regime of various assets
1)Issues of the Maintenance
Physical assets require continuous monitoring of the assets which improves the efficiency
of the assets.
 Difficult repair - From the above taken physical assets, the commercial bus is vital for
the tourism industry. In case, the bus requires a monthly or weekly check of all its parts.
The different parts of the bus such as bumper protectors, bus flooring and headlights are
carrying huge costs in their repairs.
 Uncertainties - There is risk associated with each physical asset such as bus, kitchen and
garden. Natural disasters such as floods, fires and earthquakes can affect the assets of the
organisation.
2) Provision for collecting feedback from customers and reports from staff
 Feedback surveys - surveys from customers can be derived by providing them google
forms, online questionnaires and diary entries.
3) Explaining different maintenance for each asset
In the commercial kitchen, there is a requirement to clean the vent, hood and duct. It
should be cleaned every six months. The vapour is collected on these parts which create a hurdle
in its working. For effective maintenance of the garden, it requires the removal of weeds which
are unwanted plants and hamper the growth of other plants as well. The commercial bus engine
requires frequent check-ups which consist of an alternation of the cooling system and inspection
of tires is also mandatory.
4) Location of maintenance for each physical asset
The commercial Kitchen maintenance can be done on the site because it requires less
technical treatment such as cleaning of oven, fixing thermostats to the proper temperature. In the
case of the garden, the activities of maintenance are performed at the same place because it is an
immovable asset and require continuous care by the adequate amount of sunlight, manures and
irrigation facilities. For maintaining the bus, its tasks are conducted off-site because it may
involve the use of hazardous chemicals, gases and heavy tools as well.
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5) The Expected duration of maintenance
Appliances of the commercial kitchen require fortnightly inspection which helps to run
the operations of the hospitality sector smoothly. The lawn requires daily inspection for
maintaining its greenery. The commercial bus requires maintenance on monthly basis.
6) Timings of scheduled maintenance of various assets
 Commercial kitchen - Its activities related to maintenance are done in the nighttime
after the completion of daily operations of the hotels.
 Garden - The task for improving lawns is conducted in the early morning so that each
activity can be done transparently.
 Bus - The work related to repair, replacement and modification of parts can be done in
the daytime.
7) Disruptions in maintenance and their impact
The following disruption can be observed in the activities of maintenance -
 Overlapping of activities - There may be possible that the accumulation of various
activities involved in the maintenance can create ambiguity.it becomes difficult to
identify which activity should be prioritised or how much expense a specific activity
requires.
Impact of disruptions -
The Bentley restaurant company faces several issues which hurt its performance. It can be
understood by the following points -
 Increased cost- While conducting operations of maintenance it exceeds the allowed
budget in respect of maintenance activities. This may lead to increased expenses for the
organisation. These operations demand a good amount of time which leads to wastage of
time.
 High workforce - The projects of maintenance require high labour for which an
enterprise has to pay wages and other compensatory perks to its personnel.
8) Issues regarding Workplace health and safety
WHS aims to promote the welfare of employees and its customers for protecting the
interest of its personnel. Its main goal is to safeguard its employees from hazardous tools and
chemicals. Bentley restaurant is facing numerous issues while following WHS which can be
elaborated as given below-
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At the time of covid-19, it was difficult to maintain hygiene in the working environment
which affects the health of its customers and employees. Even though, sanitisers and gloves used
while working also increase the cost of the organisation.
9) Legal and regulatory requirements for physical assets
 Leasing agreement - Bentley restaurants assets which are taken on lease are required to
maintain the leasing contracts and follow all the regulations compiled in the contract
 Environmental safety - While rendering its services to its target audience, it is vital to
follow the environmental protocols for achieving sustainability in the organisation.
10) Summary of cost impacts for human resources
Recruitment cost - With the rise in employee turnover, an organisation has to acquire
human resource continuously which increase the cost of the enterprise.
Penalty cost - For effective management, it is crucial to strictly adhere to its rules while
performing maintenance of the assets. Discipline can be enhanced among employees to include
the provision of penalties.
11) Cost of scheduled maintenance in terms of each part of the asset
 Prime cost - It includes direct material. labour and overheads
 selling and packaging cost - Bentley restaurant incur its expenditure on the packaging of
its food items for home delivery(Wrigley, Nusem and Straker, 2020).
12) Provisions for monitoring financial performance
Bentley restaurants use several measures to correct the deviations of the financial
statements. Several key factors are considered as a yardstick to compute the performance of the
restaurant. This can be described as given below-
 Working capital - For performing daily operations it is vital to maintain the liquidity in
the organisation which helps in the smooth conduct of day to day operations.
 Optimum capital structure- A firm should maintain the correct proportion of the debt and
equity in the business which boost the value of the firm.
13) Auditing the performance or viability of the assets
The auditors conduct a proper inspection of the policies related to the replacement and
acquisition of the physical assets. By keeping a check on the assets, an auditor improves the
overall performance of the organisation.
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CONCLUSION
From the above report, it can be concluded that physical assets are necessary to
conduct the operations of the enterprise effectively. Therefore, sectors such as hospitality,
tourism and event management are required to follow maintenance rules and regulations.
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REFERENCES
Books and Journals
Ann Wheeler, S. and Garrick, D.E., 2020. A tale of two water markets in Australia: lessons for
understanding participation in formal water markets. Oxford Review of Economic
Policy. 36(1). pp.132-153.
de Vet, E. and Eriksen, C., 2020. When insurance and goodwill are not enough: Bushfire Attack
Level (BAL) ratings, risk calculations and disaster resilience in Australia. Australian
Geographer. 51(1). pp.35-51.
Grafton, R.Q. and Wheeler, S.A., 2018. Economics of water recovery in the Murray-Darling
Basin, Australia. Annual Review of Resource Economics. 10. pp.487-510.
Robins, L., 2018. More than 30 years of ‘Landcare’in Australia: Five phases of development
from ‘childhood’to ‘mid-life’(crisis or renewal?). Australasian Journal of
Environmental Management. 25(4). pp.385-397.
Whiteside, H., 2020. Public-private partnerships: market development through management
reform. Review of International Political Economy. 27(4). pp.880-902.
Wolfenden, L. and et.al., 2019. The challenge for global health systems in preventing and
managing obesity. Obesity Reviews. 20. pp.185-193.
Wrigley, C., Nusem, E. and Straker, K., 2020. Implementing design thinking: Understanding
organizational conditions. California Management Review. 62(2). pp.125-143.
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