Sample format for Fixed Asset Verification Report

Posted @ 12/26/2016 4:29:24 AM by admin Under( Fixed assets verification)


The most contended part of the Physical verification exercise is the format of the final report in which findings of the exercise are submitted to the client. After a number of iterations and weeding out of unnecessary parts in a fixed assets verification report over the years, we have finally settled on a design we think works optimally and also dispenses maximum possible information to the client.

The central goal behind the designing of this format of report is to dispense maximum possible information about the status of a clients assets while at the same time, making it lean and to the point at the same time.

This twin, seemingly opposite tasks, were achieved by following the provided template –

Report on Physical Verification of Fixed Assets

Client Name                                                                                                                                              Date

Address

Dear Mr. (To whom so ever the report concerns)

Re: Report on Physical verification of fixed assets and their tagging

Introduction:  (Here it is to be mentioned that the client had hired our firm for a comprehensive verification of their assets along with tagging and reconciliation vide P.O. (Purchase order) No. xxxx dated xx/xx/xxxx

Scope of Work : (Mention here the major heads of the scope of work that was asked by the client in the intital terms and conditions. For eg-

·         Fixed asset verification of assets on the basis of FAR (Fixed Asset Register) provided to the vendor.

·         Codification and tagging of assets with Bar code labels

·         Reconciliation of information gathered as against the FAR

·         Reporting of the variances

Codification (The basis of codification is explained here, what was the logic behind the the serial number of the assets that was generated by a fixed assets management system.  Another detail to be mentioned here is what was the codification methodology adopted when any additional assets were found on site, how were they marked.

What kind of bar-coding was used for the exercise.)

 

Verification Methodology (This explains what actual method and process was used in conducting actual verification exercise by the team members)

·         Data Collection and Codification – (Here it should be mentioned that what data was shared and in what format. Also for clarification the date of receiving data should be mentioned so as to avoid any subsequent confusion over the fixed asset register cut-off date.

The categories in which the data was divided into and also the list of assets which were not verifiable due to various reasons. Also mention the reasons for not including the said items.

Next to be mentioned here is the basis on which codification was done  and what unique parameter was used, so as to there will be no confusion in future on mapping of the assets with fixed asset register)

·         Verification and tagging – (This clause explains the verification method followed for conducting the Fixed asset verification exercise, what help was required form the clients staff and if there was any problem in the same.

Also to be mentioned here is the quality of tags used, the information provided on the tags as well as provide for a sample pic of tag)

·         Reconciliation –(Here it is explained what variances were thrown by the verification exercise and how the same was reconciled with the data provided in fixed asset register.)

·         Reporting of verification results (The various annexures are mentioned here detailing various cases such as

-          Assets found in okay condition

-          Assets not found

-          Missing items

-          Duplicate items

-          Additional items

Benefits of Fixed assets verification – (here the various benefits of conducting the physical verification exercise is enumerated along with legal and regulatory requirements of the same)

Pointers for better maintainance of Fixed asset register – ( Here various points are mentioned which the verification firm thought would help the client maintain better control over their fixed assets. This is the most important step as this requires actual technical as well as operative inputs from the verification firm.)

Sign off – (Here it can be mentioned that this report and adjoining certificate can be used to satisfy any company auditor queries, be it exernal auditor or internal auditor. Also any management comments or discussions are welcome and invited.)

Signing off should be given by the firm partner, who should be a Chartered Accountant. Physical signature or digital signature must be placed depending on the format in which the report is submitted.


 






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