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asset

AS-et /ˈæsɛt/

nounB2TOEFLIELTS

generalbusiness

A useful or valuable thing or person; in accounting, a resource controlled by the enterprise as a result of past events and from which future economic benefits are expected to flow to the enterprise.

In finance, an asset is anything of economic value owned by an individual or company that can be converted into cash. It's something that provides future benefit.

The story behind the word. The word 'asset' comes from the Old French 'asez' or 'assez,' meaning 'enough.' This might seem odd at first! But it evolved from the legal phrase 'avoir assez' (to have enough), referring to sufficient property to pay one's debts. So, your assets are what you 'have enough' of to cover your obligations and provide future benefit.

Word relationships

property: More general, can refer to physical possessions; 'asset' specifically implies economic value and future benefit.
resource: Broader; an asset is a type of economic resource.

liability: Something owed to others, rather than something owned.

Commonly confused with

liability: An 'asset' is something you own that has value, while a 'liability' is something you owe to someone else.

Collocations

current assets
fixed assets
liquid assets
intangible assets
total assets

Idioms & expressions

a valuable asset

Example sentences

"The company's assets included its factory building, machinery, cash in the bank, and accounts receivable from customers." Examples of company assets.
"His primary assets were his house, his retirement savings, and a diverse portfolio of stocks and bonds." An individual's assets.
"Brand recognition and patented technologies are often considered valuable intangible assets for a modern corporation." Intangible assets.

Memory hook

An ASSET is something you ASSESS as valuable. Valuable possession

When not to use

While 'asset' can refer to a valuable person, in an accounting context, it strictly refers to economic resources.

Fun facts

Assets are typically listed on a company's balance sheet, categorized into current assets (convertible to cash within a year) and non-current assets (long-term).
The concept of 'human capital' sometimes extends the idea of assets to the skills and knowledge of employees, though this isn't typically recorded on a balance sheet.