Financial Management of IT Assets
About 5% of the CIS-HAM exam — see all 5 domains.
- Depreciation: Methods include straight-line and declining balance; configured via depreciation schedules tied to model category/cost. Tracks book value over an asset's useful life.
- TCO (Total Cost of Ownership): purchase + maintenance/support contracts + consumables + disposal, aggregated to understand true lifetime cost.
- Cost center / financial owner assignment supports chargeback and reporting.
- Salvage/residual value and disposal proceeds close out the financial record at retirement/disposal.
- Financials lean on accurate attribute data (cost, PO, contract, dates) — which is why Domains 2 and 3 carry the heavy weight.
Sample questions from this domain
Three of the 14 in this domain, with the reasoning. The full set is in the question bank.
What does depreciation represent for a hardware asset?
- A. The normalization of the asset model
- B. The systematic allocation of an asset's cost over its useful life ✓
- C. The assignment of an asset to a user
- D. The physical movement of an asset between stockrooms
Why: Depreciation allocates an asset's cost across its useful life for financial reporting. It is not stock movement, model normalization, or user assignment.
Which depreciation method allocates an equal expense amount to each period of an asset's useful life?
- A. Units of production
- B. Sum-of-the-years'-digits
- C. Declining balance
- D. Straight-line ✓
Why: Straight-line depreciation spreads cost evenly across each period of useful life. Declining balance and sum-of-the-years'-digits are accelerated methods, and units of production ties expense to usage.
What does Total Cost of Ownership (TCO) for a hardware asset include?
- A. Acquisition cost plus ongoing costs such as support, maintenance, and operation over the asset's life ✓
- B. Only the disposal cost
- C. Only the purchase price
- D. Only the depreciation expense
Why: TCO sums acquisition plus ongoing costs (support, maintenance, operation, and disposal) across the asset's life. Purchase price, disposal cost, or depreciation alone is incomplete.