A number of factors should be considered when assigning values to assets. Which of the following is not used to determine the value of an asset?
A.
The asset’s value in the external marketplace
B.
The level of insurance required to cover the asset
C.
The initial and outgoing costs of purchasing, licensing, and supporting the asset
D.
The asset’s value to the organization’s production operations
Explanation:
B: The level of insurance required to cover the asset is not a consideration when assigning values to assets. It is actually the other way around: By knowing the value of an
asset, an organization can more easily determine the level of insurance coverage to purchase for that asset. In fact, understanding the value of an asset is the first step to
understanding what security mechanisms should be put in place and what funds should go toward protecting it. This knowledge can also help companies perform effective
cost/benefit analyses, understand exactly what is at risk, and comply with legal and regulatory requirements.
A is incorrect because the asset’s value in the external marketplace is a factor that should be considered when determining the value of an asset. It should also include the
value the asset might have to competitors or what others are willing to pay for a given asset.
C is incorrect because the initial and outgoing costs of purchasing, licensing, and supporting the asset are considerations when determining the cost and value of an asset.
The asset must be cost-effective to the business directly. If the supporting requirements of maintaining the asset outweighs the business need for the asset, its value will
decrease.
D is incorrect because it is a factor to be considered when determining an asset’s value. The asset’s value to the organization’s production operations is the determination of
cost to an organization if the asset is not available for a certain period of time. Along these same lines, the asset’s usefulness and role in the organization should be considered
as well as the operational and production activities affected if the asset is unavailable. If the asset helps operations it is valuable; the trick is to figure out how valuable.