What are 'Furniture, Fixtures & Equipment - FF&E'

Furniture, fixtures and equipment, abbreviated FF&E or FFE, are movable furniture, fixtures or other equipment that have no permanent connection to the structure of a building or utilities. These items depreciate substantially over their long-term use, but they are definitely important costs to consider when valuing a company, especially during liquidation procedures.

Examples of FF&E include desks, chairs, computers, electronic equipment, tables, bookcases, and partitions.

Sometimes, the term furniture, fixtures and accessories (FF&A) is used in place of FF&E.

BREAKING DOWN 'Furniture, Fixtures & Equipment - FF&E'

Accountants compile all of the furniture, fixtures and equipment (FF&E) into a separate line item in a budget or a financial statement under tangible assets. FF&E go into a project's final cost so an auditor can determine if a purchase comes under budget or over budget. FF&E generally have a life span of three years or more.


An asset goes into the FF&E category if it is used by a business to conduct its normal, daily operations. A chair for the front desk person at an office building counts as an FF&E item because the employee needs the chair to perform daily tasks to keep the business running smoothly. The telephone sitting on the desk is categorized the same way; the administrative assistant cannot function without answering the phone and forwarding calls. The person's computer, printer, filing cabinet, desk organizer, and pen holder all count in the FF&E category when determining how much these assets are worth.

For example, the Federal Reserve lists several types of FF&E it uses for its normal operations. Automotive equipment, such as trucks, cars and tractors, fall into this category. Material handlers, fork lift trucks, drill presses, and currency counters are all equipment this agency uses on a regular basis. Security equipment, such as X-ray scanners, biometric devices, magnetometers and access control devices, fall into this category because Federal Reserve staffers can move this equipment out of the building.


Financial officers determine depreciation of FF&E in several ways. The first rule of thumb is to examine the useful life of the item. A chair may last 20 years, but a desktop computer's life could end after three years when the company needs newer technology.

The Federal Reserve uses the straight-line method of depreciation to determine the value of FF&E items. This means the formula is a straight line. In this case, the Federal Reserve takes the cost of the asset minus the salvage value and then divides the result by the estimated useful life, in months, to arrive at a monthly depreciation charge. Depreciation continues until an item's useful life is reached.

As an example, a car is worth $10,000 new, and its useful life is three years. The maximum salvage value of the vehicle is 20%. When the agency first buys the car, the monthly charge is [$10,000 - (20% x $10,000)] / 36 months. The final total is $222.22 at the end of the first month. The book value of the car changes each month, so the Federal Reserve uses new values every month to ascertain its value for accounting purposes.

Businesses operating in the hospitality industry make a substantial amount of investment inĀ  furniture, fixtures & equipment. These assets are essential to a hotel's core business operations, considering the fact that the interior furnishings of a hotel make up significant expenses. For example, FF&E budget categories can include hotel room furnishings and decorative items, common area furnishings, restaurant, bar and conference room furnishings and equipment, office furnishings, storage equipment, computers, projectors and other items relating to technology. An analyst evaluating a business in the hospitality sector would, therefore, closely scrutinize the FF&E assets of the company, factoring in depreciation in his or her analysis.

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