VERIFICATION PROCEDURES

1.DATA COLLECTION & PRELIMINARY REVIEW

1. Obtain existing records related to fixed assets such as:

• Previous Fixed Asset Register(s)
• Trial balance and general ledger
• Asset capitalization details, invoices, and purchase orders
• Depreciation schedules
• CWIP (Capital Work in Progress) and Intangible assets details

2. Review asset capitalization policies and useful life.
3. Identify data gaps, inconsistencies, and required documentation.

2.PHYSICAL ASSET VERIFICATION

1. Conduct comprehensive physical verification of all fixed assets across all locations.
2. Automate audit and tracking of physical assets using barcode or RFID technology to improve accuracy and efficiency.
3. Tag and label each asset with a unique identification code.
4. Record essential asset attributes:

• Asset location
• Description and make/model
• Asset ID / Tag number
• Serial number (if applicable)
• Custodian/department
• Condition and usability

Outcomes & Benefits

• Up to 90% higher efficiency in audit and reconciliation.
• 100% accuracy in physical verification.
• Identification of missing, obsolete, or untraceable assets.
• Better decision-making through verified, accurate asset data.

3.ASSET IDENTIFICATION, CLASSIFICATION & TRACKING

1. Classify all assets in compliance with the Companies Act:

• Land & Buildings
• Plant & Machinery
• Furniture & Fixtures
• Office Equipment
• Computers & Peripherals
• Vehicles
• Leasehold Improvements
• Intangible Assets

2. Segregate capital and revenue expenditure.
3. Identify fully depreciated but still-in-use assets.

Real-Time Asset Tracking Features

• Maintain a fully accurate, compliant Fixed Asset Register (FAR).
• Real-time asset updates supported by approval workflows.
• Reduces manual effort, enabling decisions based on facts, not assumptions.

4.MAINTENANCE TRACKING (CMMS)

1. Implement a Computerized Maintenance Management System (CMMS).
2. Automate preventive & corrective maintenance, including work orders.

Benefits:

• Reduced asset downtime.
• Greater maintenance visibility and control.
• Improved asset availability and utilization.
• Lower maintenance costs and optimized resource use.
• Enhanced ROI through extended asset lifecycle.

5.INVENTORY MANAGEMENT

1. Gain real-time visibility into inventory through a cloud-enabled system.
2. Track equipment, consumables, tools, office supplies, auto parts, etc.

Capabilities:

• Conduct audits, cycle counts, issue/return tools anytime, anywhere.
• Integrated barcode scanning for instant item identification.

Benefits:

• Real-time inventory accuracy.
• Faster reconciliation and tracking.
• Reduced stock-outs and improved planning efficiency.

6.LEASED EQUIPMENT TRACKING

1. Modernize leased equipment tracking with cloud-enabled visibility.
2. Maintain real-time asset records and full lease histories.

Stakeholder Benefits

• Lessees: Accurate tax deduction calculations for leased equipment.
• Lessors: Real-time insights into asset location, condition, and usage.
• Better communication between lessors, lessees, and service providers.

7.FIXED ASSET REGISTER (FAR) PREPARATION & UPDATION

1. Develop/update the FAR with:

• Asset Code / Tag No.
• Category
• Description
• Location
• Acquisition Date
• Cost
• Accumulated Depreciation
• Net Book Value
• Useful Life / Residual Value
• Custodian
• Remarks (disposed, missing, obsolete)

2. Link physical assets to accounting records.
3. Align depreciation with Schedule II or company policy.

8.RECONCILIATION AND MAPPING TO FINANCIAL STATEMENTS

1. Reconcile the physical verification results and updated FAR with:

• Trial balance / general ledger
• Fixed asset schedule in the financial statements

2. Identify and report:

• Assets not recorded in books
• Assets recorded but not found physically
• Differences in cost or accumulated depreciation

3. Provide necessary adjustment entries for management approval.

9.REPORTING & DELIVERABLES

1. Comprehensive Reportincluding:

• Summary of verification results and discrepancies
• Observations and recommendations for control improvements
• List of assets requiring management decision

2. Finalized Fixed Asset Register (FAR)in Excel or ERP-compatible format.
3.  Physical Verification Report(location-wise and category-wise).
4.  Tagging Summary Reportshowing tagging completion percentage.
5. Reconciliation Statementmapping FAR to Financial Statements.