Agency 1: Short-duration Assets
The first agency in the community, Short-duration Assets, governs the acquisition, leasing, replenishment, and use of short-term assets. It also governs the use of working capital facilities and of community-linked credit lines by stewards and their dependents.
In a NewVistas community, all assets are owned by the community. Agencies 7 (Clearing), 8 (Property), and 9 (Capital) hold title on behalf of the community trust. Agencies in the village Bureau (agencies 1 – Short-duration assets, 2 – Long-duration assets, and 3 – Equipment govern how these assets are acquired, leased, used, and disposed. Each agency governs a specific class of assets.
Assets governance
While the community owns all assets and governs how they are acquired and utilized, it does not have custody. Instead, stewards have physical and operational custody, controlling how assets are utilized. Community agencies also do not engage in the daily utilization of assets, with their role strictly being restricted to governing the various processes through which assets are acquired, used, and disposed.
Acquisition
Every steward is required by the community to write a detailed business plan that covers every aspect of their enterprise, including raw material procurement, production, logistics, marketing, risk management, and accounting. This plan is submitted to the community through the Schema Agency (agency 19). The agency runs various checks on the business plan, using its data and AI, as well as other agencies’ capabilities for stress testing, viability assessment, and risk management, before approving it.
Once approved, the steward sources the inventory required. To do this, the steward uses their credit line, which is owned by agency 7 as a short-duration asset, and governed by agency 1.
While the Short-duration Assets agency governs the acquisition process, which is carried out by the teward, the acquired asset belongs to Agency 7 (clearing), which also owns all assets that Agency 1 controls.
The change in custody here is one of the special aspects of the community’s economic system. Since the inventory belongs to the community, the current custodian releases it to the buyer upon receipt of payment. The payment goes towards replenishing their credit line, while the surplus, after deducting what is sufficient for their business and personal expenses, goes to the community. The new custodian now has the inventory, as well as a negative balance in their credit line amounting to what they paid for the asset.
Through all this, the Short-duration Assets agency monitors the process and has established guidelines to guide the acquisition of any assets.
The acquisition of inventory and other short-duration assets does not always occur through this process. Sometimes, it is mined, in this case, its value being based on market value (based on actual value and availability, with value being mostly based on the prices of future products derived from raw material), fees for extracting rights, and the cost of extraction, including transport from mine to initial storage before further processing.
When selling, the steward who obtains the raw material will look to replenish their credit lines first, cover the cost of extraction, and thereafter make a profit based on the factors listed above. Every other step in the processing chain will use the first cost as a basis for its own costing.
Leasing and maintenance
Whenever a steward has custody of an asset – whether inventory or any other- they are in fact leasing it from the community, which maintains full ownership at all times. The Short-duration Assets agency governs the leasing process. Agreements are entered between it, on behalfof the community, and the relevant steward. The agency then issues biinding leases to the custodian of an asset. It describes the rights and obligations of both parties to the agreement.
When inventory and other short-duration assets are not used consumptively – meaning that the steward uses the item for a short time and returns it in the same conditions or close to it- the agency engages contractors who otherwise maintain custody when the asset is not in active use.
In either case, whoever has custody is also responsible for maintaining assets and keeping them in merchantable order. For instance, a business that buys flour from millers and processes it for use in restaurants for tacos, porridge, bread, and other products keeps the product in stock for a reasonable amount of time to ease operations. It is responsible for storage and logistics, which contribute to its production cost.
Stewards are responsible for maintaining the right stock levels for their business. the rcords that show stock movements are also viewed by the Shprt-duration Assets agency. Replenishment is a factor of both the pevailing stock conditions and the steward’s business plan, and, while it is initiated by the syeward, the agency maintains control over the process to ensure proper business practices and prevent abuse of the system. In mmost cases, however, the agency discharges these functions through its automated system and contractors.
As mentioned earlier, the assets that Agency 1 deals with are mostly processed and consumed, and in such cases, depreciation and disposal as in the case of medium and long term assets is absent. However, in cases where short-term assets are to be disposed of, the agency maintains accounting and technical reports that clearly show the status of each asset, its maintenance schedules, depreciation, and the expected time of disposal. When this time arrives, the agency again engages contractors to dispose of the item.
sub-spend controls (credit lines and working capital)
Each steward is issued a credit line by Short-dutation Assets agency. the credit lines are owned by Agency 7, which, in conjunction with other agencies in the Repository Bureau, secures the facility fro man external bank.
Agency 1 governs how the credit line is used. While stewards are allowed to use it for all their personal and business expenses, there are guardrails in place to prevent abuse and waste. The agency implements guidelines to ensure responsible use, so participants can improve their financial status, make their businesses and lives more successful, and be more prosperous.
Training
As part of their business plan, a steward is expected to be competent in handling the assets in their custody. The Short-duration Assets Agency coordinates with the Schema Agency (agency 19) to ensure that sufficient training material is available in the community, offered independently by other stewards, so that stewards are not only competent but also in a position to thrive because they have the necessary skills.