Companies (Auditor's Report) Order — tangible fixed assets
CARO Fixed Asset Verification Checklist
Use this checklist when reviewing fixed assets under CARO. Tick items as you complete fieldwork. Adapt for your engagement size and industry.
A. Existence & title
- Obtain FAR as at balance-sheet date (cost, accum. dep., WDV, location, custodian).
- Reconcile FAR closing gross block to general ledger / Trial Balance.
- Verify title deeds / ownership documents for immovable properties (sample or full).
- Confirm leased / hire-purchase assets are correctly classified and disclosed.
- Check whether assets held in the name of directors / related parties are disclosed.
B. Physical verification
- Enquire management policy for physical verification (frequency, coverage, responsibility).
- Obtain PV reports / certificates for the year and prior year.
- Assess whether coverage (branches / categories) is reasonable.
- Sample-check physical verification workpapers (lists, exceptions, photos, QR scans).
- Verify discrepancies (shortages / excesses) were investigated and adjusted.
C. Additions, disposals & revaluation
- Vouch material additions to invoices, GRNs, capitalisation memos and put-to-use dates.
- Ensure capital work-in-progress transfers are complete and timely.
- Vouch disposals / scrap / sales to board approvals, sale deeds and accounting.
- Check revaluation (if any) against valuer report and Companies Act disclosure.
- Confirm component accounting applied where material components have different lives.
D. Depreciation & impairment
- Review useful lives vs Schedule II (or justified technical assessment).
- Recalculate depreciation for a sample (SLM / WDV) including mid-year additions.
- Check residual value policy consistency.
- Enquire indicators of impairment; review impairment testing if applicable.
- Agree accum. dep. movement to P&L charge and disposals.
E. Reporting & documentation
- Document sampling basis, exceptions and management responses.
- Evaluate CARO reporting implications (qualifications / adverse comments if needed).
- Obtain management representation on completeness of FAR and PV.
- File title-deed sighting notes, PV reports and depreciation workings in the audit file.
Prepared by: ______________________
Date: ______________________
Reviewed by: ______________________
Engagement: ______________________