PLANT & MACHINERY - Defined In Simple Terms

                                             Written by Nwabuisi Dennis

Over the years the concept of plant and machinery valuation in Nigeria was a thing that wasn't actually been looked into by people especially companies and entities as well as government organizatioons when carrying out valuation of asset of the company or organization. In mots cases when these valuations where carried out, there seem to be some lapses in terms of the factors consider in arriving at the values of the plants.

This Post would first of all be reviewing the meaning of Plant and Machinery as it is defined by the International Valuation Standard Council (IVSC).

Plant can be defined as Assets that are inextricably combined with others and that may include specialized
structures, machinery and equipment.

Machines on the other hand can be defined as An apparatus used for a specific process in connection with the operation of an
entity.

Note: Equipment as mentioned in the definition of plant in this context can be seen to be the Other assets that are used to assist the operation of an enterprise or entity.
(IVSC, 2010).

Therefore, it is on this note that one may now be able to simply clarify and understand the distinct difference between the meanings of plants and machinery as the case may be.

In the Valuation and Appriasal of Both Plants and Machinery, there are factors that one need to consider in other to arrive at an acceptable value for such plant and machinery and these factors include;

- The Age of the Plant/Machinery: This can usually be gotten from the manufacturers info box either on the body of the machine or through their website as the case may be.

- The Size of The machine: Well, many would say that the size doesn't matter per say in comparism to the functionality of the machine, but to a great extent if the cost of transporting the machine from one country to another was measured by the weight of the machine either in gramms, kilogram or even Tons as the case may be, that may have a role to play in the total amount spent in acquiring the machine.

- The Manufacturer: This is another important aspect of ascertaining the value of a plant and machinery because as we know, some countries are best known for some certain kind of equipments, plants and machine manufacturing, and that to a great extent plays a role in determining the value of a plant/machinery. one would by default say that machines, plants and equipements coming from Germany, Japan is always superb due to the manufactures working performance.

- The Make of the Plant/Machinery: To an extent just like the manufacturer, the company that produced the machine also have their name to speak for them. It is true and possible that two different plants with the same fucnction can be manufactured in the same country but with different names or manufacturers. Others and many would go for a particular make been regarded as the best. For example, Toyota & Volkswagen may be manufactured in the same country, some would rather go for Toyota due to its durability, sustainability in the long run and so many other reasons.

At this juncture, I would rather like to stop here and reassure you that other insightful write ups on this topic would come your way real soon.

Happy Reading....