Fixed assets verification audit is a process of physically verifying the existence and condition of fixed assets as recorded in an organization’s fixed asset register. The verification audit is usually conducted periodically, such as annually or biennially, to ensure that the information in the fixed asset register is accurate and up-to-date.
The verification audit process involves several steps, including:
- Planning the audit: This includes defining the scope of the audit, identifying the assets to be audited, and preparing the audit plan.
- Conducting the audit: This involves physically verifying the assets and comparing them to the information recorded in the fixed asset register. The auditors may use barcodes, RFID tags, or other identification methods to match the physical assets with their corresponding records.
- Identifying discrepancies: Any discrepancies between the physical assets and the fixed asset register should be noted and investigated. These discrepancies may include missing assets, assets that are no longer in use, or assets that are recorded in the register but cannot be located.
- Resolving discrepancies: Once discrepancies are identified, steps should be taken to resolve them. This may involve updating the fixed asset register, conducting further investigations, or taking corrective actions.
- Reporting the audit results: The results of the audit should be documented in a report and shared with management. The report should include any discrepancies identified, the actions taken to resolve them, and any recommendations for improving the fixed asset management process.
The fixed assets verification audit helps organizations ensure the accuracy of their fixed asset records, which can help prevent errors and fraud, reduce costs, and improve decision-making related to fixed asset management.