Fixed Assets Verification
Verification of fixed assets consists of an examination of related records and physical verification. The auditor should normally verify the records concerning the documentary evidence and by evaluation of internal controls. Physical verification of fixed assets is primarily the responsibility of the management.
- Preparing and Maintaining fixed asset registry.
- Identifying & Verifying Physical assets that match the physical records to the book records.
- Calculating depreciation as per statutory requirements.
- Advising on capitalization of fixed assets in periodical intervals and inventory reconciliation.
- Tagging and barcoding fixed assets for easy identification of assets.
- Advising on implementing Internal Controls systems over the expenditure of fixed assets.
TThe main objective for the audit is to conduct a compliance check of the assets which are mentioned in the Fixed Asset Register against those in existence. Other objectives include — ensuring fixed assets validity, including the fixed assets purchased and excluding those sold, values stated based on either cost less depreciation or revaluation, detailed assets in fixed asset schedule included in the balance sheet, or if the leased have the right of its ownership, and for relevant fixed assets shown in the financial statements to have a clear understanding of the financial position.
Major challenges faced by the companies are regular verifications of the Fixed Assets owned by them. At times when, the management is not sure of the existence of the records that are reflecting in the records of the Fixed Assets, which includes conducting exhaustive exercises for verification of fixed assets and inventory. We help organizations carry out fixed assets and inventory verification. We at Sapient Services help organizations with the process of fixed assets management, a process seeking to track fixed assets for financial accounting, preventive theft, and maintenance deterrence, and to help them carry out fixed assets and inventory verification.
Our services are included in the following areas:
The need of the Fixed Asset Verification also assess when there is a frequent change in product line or replacing of old machines with high capacity machines. The old machines are still carried in Fixed Asset Register whereas the old machines have already been scraped and disposed off.