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What is FF&E?

Updated: Apr 21

Furniture, Fixtures, and Equipment (FF&E) encompasses all the movable and detachable assets a company uses in its daily operations that are not part of the building's structure. This includes everything from movable chairs and desks to wall-mounted bookshelves that can be removed without harming the building's integrity. It also covers business equipment like computers.

Items fall under the FF&E category if they are crucial for a company's operations and can be taken away without leaving a permanent mark on the building. Notable examples include office furniture, computers, electronic devices, phones, window treatments, decorative items, and more. However, consumable supplies, structural components like windows, doors, and permanent fixtures do not qualify as FF&E.

FF&E has different implications across various sectors. In accounting, these items are listed separately under tangible assets on a balance sheet to reflect their value. They are considered "tangible" because they have physical form and are "assets" due to their value to the business. In fields like interior design, real estate, and construction, FF&E typically pertains to the selection and purchase of these items for new or existing business spaces.

Distinguishing between furniture, fixtures, and equipment: Furniture refers to larger movable items; fixtures include items that may be attached but are not permanently part of the building, like bookshelves or cubicle partitions; and equipment encompasses tangible items used in business operations, including technology and industry-specific tools.

FF&E purchasing or procurement involves acquiring these items for a business space. This process can range from a small business owner making direct purchases to larger entities employing procurement services for efficiency and expertise. Procurement agencies or interior designers might be hired to manage the acquisition, delivery, and installation of these assets, ensuring everything is in place according to company specifications and timelines.

FF&E specifications detail the requirements for each item to be purchased, including material, design, and quality expectations. These can be proprietary, prescriptive, performance-based, allow for substitutions, or reference specific standards.

Depreciating FF&E involves allocating the cost of these assets over their useful life, reflecting their decreasing value over time. The straight line depreciation method is commonly used, spreading the cost evenly across the asset's lifespan after accounting for salvage value. This method helps match the expense of the asset with the revenue it generates over its useful life, as dictated by accounting standards and CRA/IRS guidelines.



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