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General
• Procedures and policies for acquisitions, transfers and disposals of fixed assets
should be established. Fixed assets’ useful lives should be clearly defined and be
consistent with the company’s fixed assets policies.
• Each operating unit’s finance department must maintain a comprehensive and up-
to-date Fixed Assets Register.
• The register should include the following details:
- Cost of asset
- Asset useful life or depreciation rate
- Location
- Current and accumulated depreciation rate
- Net book value
• As far as possible all tangible fixed assets should be promptly tagged to permit
easy identification.
• Accuracy of the register should be verified through periodic physical fixed assets
counts and confirmations with custodians.
• All adjustments to the Fixed Assets Register should be authorised by the Finance
Manager/Accountant after sufficient investigation.
• Land, buildings and leasehold buildings should be revalued by independent
professional valuers once every X years.
• Fixed assets’ useful lives should be reviewed once every X years.
• There should be adequate insurance coverage policy for fixed assets.
• All fixed asset movements should be approved in accordance with the authority
limits.
• Fixed Assets Transfer Form must be completed and acknowledged by the
receiving department for all permanent transfer of fixed assets.
Fixed Assets Acquisition
Reconciliation
Segregation of duties
• Physical fixed assets at all locations should be counted and checked against book
records at least once every two years.
• Differences between fixed assets counts and book records should be investigated
• Thoroughly before adjustments are approved and made to the books. Results
from the investigation should be documented and reported back to Head Office.