Fixed Asset Controls and Reporting
CPCON is a market leader in implementing best-practices approaches to fixed asset management for an improved financial and management reporting, audit and stakeholder requirements, taxes, insurance, and regulatory compliance.
Talk to an CPCON Fixed Asset Expert.
Top Fixed Asset Management challenges for Financial and Management Reporting
Audit risks
Infrequent physical inventory / reconciliation often lead to deficient asset accounting records – containing ghost assets, grouped assets, vague descriptions, etc. –, exposing an organization to a qualified audit opinion
Financial statement risk
Inferior fixed asset accounting records and poor documentation of asset movement (including additions and retirements) can lead to inaccurate financial reporting, exposing an organization to risk in management’s credibility with shareholders
Property tax and insurance overpayments
Unrecorded retirements (or “Ghost Assets”) are assets no longer existing but are still on the books, leading organizations to overpay taxes and insurance premiums by 15% to 20%
Enhance Fixed Asset Controls and Management Reporting, from existence testing to valuation, and asset register reconciliation, with an integrated RFID solution
Fixed Asset Review / Diagnose
Asset Identification and Tagging
Asset Valuation / Appraisals
Asset Register Reconciliation / Componentization
Fixed Asset System (or ERP) Compilation
ERP-RFID INTEGRATION - BEST-PRACTICES IMPLEMENTATION - SOX COMPLIANT
Fixed Asset Control Solution
OUR SOLUTIONS
Fixed Asset Review / Diagnostic Studies
Often, organizations have written policies and procedures for purchasing capital assets and capitalization threshold to ensure proper internal control over fixed assets.
Fixed assets represent the long-term tangible assets that an organization utilizes to produce and deliver its products and services, and manage its operations. Since the wider adoption of SOX and IFRS accounting standards, auditors have increased scrutiny and testing of fixed asset controls.
We perform diagnostic consulting on fixed assets to assist our clients in reviewing, cleansing, reconciling, or even creating their fixed asset register. Our professionals have deep experience and technical knowledge in establishing the best practices and compliance with applicable standards to fixed asset management system.
Fixed Asset Inventory, Tagging and Reconciliation
Infrequent physical inventory / reconciliation often lead to deficient asset accounting records – containing ghost assets, grouped assets, vague descriptions, etc. –, exposing an organization to a qualified audit opinion.
Fixed asset inventory involves verifying, tagging, and recording all descriptive and locational information possible of the enterprise fixed assets. Another important step is reconciling the inventory to the fixed-asset accounting records.
We’re independent global firm that has both specific industry and physical inventory and reconciliation qualifications and experience. Being familiar with all types of fixed assets, with vast experience in interacting with the client’s professionals and staff while operating in unique environments. Our fixed asset management services include:
- Comprehensive and customized project planning needed for physical inventory.
- Conduct a physical inventory focused on recording all locational and descriptive (asset condition, model, brand, etc.) information.
- Utilization of Tablet Technology Inventory Software for data collection and reporting
- Affixing property tags to all untagged assets
- Conduct Line-by-Line fixed asset register reconciliation
- Asset barcoding or RFID tagging solutions
Asset Componentization
Componentization is the process of segregating and allocating each part of an Property, Plant and Equipment (PPE) item with a cost that is significant in relation to the total cost of the item.
Our professionals perform a detailed asset inventory to identify PPE (fixed asset) and building elements, segregating and booking them separately under the componentization requirement.
CPCON has served more than 2,500 organizations across the globe. We have deep experience working with national and global manufacturers and their auditors to maintain sound financial records.
Our asset componentization segregation services include:
- Conduct full Physical Inventory and Appraisal
- On-site verification of assets
- Perform Fixed Asset Componentization studies
- Compile detailed Fixed Asset listing
- Layout design to populate ERP
- Useful life / depreciation studies
Line-by-Line Asset Register Reconciliation
The effective management of fixed assets is an increasing challenge. Often, issues with inventory management arising from insufficient tracking of asset additions and retirements, inaccurate assets ledgers inherited from prior transactions, and inconsistent tracking of fixed equipment and building systems lead to inferior records.
We have developed a comprehensive line-by-line reconciliation of the physical inventory to the fixed asset accounting records. This addresses each asset until it’s verified as a match, retirement or addition, as described below:
- First, we proceed with the tag number match;
- Manufacturers and models are then compared;
- Location and department numbers are considered;
- Fiscal year additions will be analyzed against estimated acquisition dates from the inventory;
- Bulk purchase entries and grouped purchases are allocated to the individual assets;
- We will conduct follow-up visits with departments to verify any residual asset.
- Each line item on the fixed asset accounting record will receive a transaction code – such as, unrecorded addition, matched asset, and unrecorded retirement – to link it to reconciled inventory database
- Implementing the best-practice approach to asset management and withstanding an audit scrutiny.
Machinery and Equipment Valuation
There are a variety of reasons your organization may require a machinery and equipment valuation. We perform machinery and equipment valuations for different purposes including financial reporting, insurance, tax, and regulatory compliance.
We have advised organizations for over 25 years, and we have expertise in all classifications of real and personal property. In the last 5 years, we appraised buildings and machinery and equipment valued at over $400 billion.
Our machinery and equipment valuation and appraisal services include:
- Fair value determination for Impairment Testing, ASC 360 and IAS 36
- Fair value determination for revaluation for IAS 36
- Fair value determination for Lease classification ASC 820
- Fair value determination for Business Combinations, ASC 805 and IFRS 3
- Fair value determination for Tax purposes
- Replacement cost and Actual Cash Value determination for Insurance
- Fixed asset appraisals for useful life / depreciation studies
- Fixed asset appraisals for fixed asset inventory / reconciliation
Fixed Asset Accounting System / ERP System: Updating Services
Capital intensive and decentralized operations often face challenges in maintaining accurate asset accounting records. Even when organizations establishes proper internal controls over fixed asset transactions, equipment tends to be moved, transferred, and disposed without appropriate documentation. Impacting on the integrity of electronic fixed asset accounting system (ERP system), which can lead inaccurate financial reporting.
We provide verification, compilation and annual updating services to ensure our clients receive cleansed and sound financial asset records. By identifying unrecorded additions, unrecorded retirements, ghost assets, misclassifications, our professionals assist clients with maintaining a complete fixed asset accounting system – and leading ERP systems like SAP, Oracle, IBM Maximo, etc. – for financial reporting, tax, insurance, and regulatory purposes.
Useful Life and Depreciation Rate Studies
We perform useful life and/or depreciation rate studies of machinery and equipment, fixed assets for a variety of purposes including financial reporting, tax, and regulatory compliance.
We have deep experience in on-site verification of physical aspects / condition of the property, confirm assets identified on listings, and perform physical measurements. Our team analyzes both the economic and physical life of the property assets, while taking into consideration many factors including research on current technology, current and expected capacity, expectations on future maintenance capital expenditures, and reliability data.
ERP-RFID Inventory Solution
Even when organizations establishes proper internal controls over fixed asset transactions, equipment tends to be moved, transferred, and disposed without appropriate documentation. Impacting on the integrity of electronic fixed asset accounting system (ERP system), which can lead inaccurate financial reporting.
CPCON’s ERP-RFID integrated solution automates the documentation and tracking of fixed assets, delivering real-time inventory accuracy.
Our ERP-RFID inventory solution includes:
- Inventory data collection technology with Bulk RFID Scanning
- Real-time data reconciliation of the fixed asset existence to the financial / accounting records
- RFID asset tags can be read and located from up to 12-ft distance
- Dashboard creation
- ERP interface or integration (SAP, ORACLE, IBM MAXIMO, etc.) creation to automate data input and increase asset visibility
Our experience
See how clients are succeeding with CPCON Fixed Asset Advisory Services
SOX COMPLIANCE
Discover how RFID is revolutionizing SOX Compliance (Sections 409 and 802)
Why choose CPCON Fixed Assets?
We have combined the best-practices of fixed asset management with advanced technology – ERP-RFID integrated solution – into one full solution, CPCON Fixed Assets.
