Dereciation, Business valuation and small assets

ExcelAnt

Hello all,

I have what is hopefully an interesting problem.

I work for a small company in the service industry. They have two offices and as the business has evolved so have finance practices. I am currently working through our fixed assets as we are due to move offices and finding many discrepancies.

I would like to understand the following:

1)The business previously recorded most "assets" as fixed assets (we have a plant on our fixed asset register!) What are the implications of capitalising trivial items like this on the accounts, to me it seems this would artificially inflate the assets, increasing business valuation and increasing short term profits. Am i missing anything here?

2) Secondly many items have been replaced but appear twice (disposals were never made) what should I do with old items that have been thrown away? (we are also in a temporary low point and hitting the P&L would be very unwelcome by the directors, but this is the nature of the transactions, how would you deal with it?)

3) Several items are fixed assets that are sat comfortably in the directors home (this i realise is wrong but how to address such a thing?) again these so called assets are artificially inflating the balance sheet.

4) We are due to move soon and will be selling most of the fixed assets. When we do dispose of these items it will be at cost how should this be recorded and "hypothetically" what would the implications of giving proceeds of sales profit to staff as an incentive to sell these items. Sales would be done outside of work time.

Any help appreciated.