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					W/P Ref: INTERNAL AUDIT PROGRAMME BUSINESS UNIT: ABC SYSTEM/PROCESS: Fixed asset count Prepared by: Gary (garywu@sohu.com) Date: Nov. 28, 2001

AUDIT STEPS

REF

MATTER ARISING

DONE BY

To ensure that the fixed asset count is properly and adequately planned with appropriate procedures. 1. Examine the fixed asset counting plan for adequacy, comprehensiveness and appropriateness. Follow up with management for any queries and raise audit comments, where necessary. Ensure that the final plan is properly authorised. Through attending the staff briefing or planning meetings, ensure that all counting personnel are properly segregated, trained and briefed in advance to carry out the counting procedures.

2. 3.

To ensure that fixed asset count is properly conducted according to the pre-set procedures. 4. On-site observe the operation of the control unit to ensure that the counting procedures are properly managed. Note especially the handling of missing and exceptional items. Judgementally select 6 locations, on-site observe the physical counts to ensure that they are conducted in accordance with the pre-set procedures. During the observation, pay particular attention to the treatment of:  Borrowed and leased assets, if any;  Disposed or sold assets in transit;  Separate identification of idle assets;  Obsolete assets. For the locations selected in step 5, on-site observe the supervision of the control units to ensure that they are effectively discharging their control functions. Upon completion of the count, ensure that the counting departments and the control units have properly inspected the area for complete coverage of all counted items. Raise and discuss any exceptions noted during our observation.

5.

6.

7.

8.

To independently confirm the physical existence of fixed assets. 9. Judgementally select 10 fixed asset items (avoid duplicating those by the control unit) in the 6 selected locations from the fixed asset list and perform the following: i. ii. Match the fixed asset details e.g. asset description, asset code, model number and quantity from the list to the physical asset. Follow up with any discrepancy. Mark or sign on the fixed assets count tags to evidence our counting.

iii. Mark our counting results on the fixed asset list. 9. In the selected locations, judgementally select 10 fixed asset items from the floor and perform the same steps as 9. Tour around the selected locations, observe for any uncovered or questionable items. Follow up with the relevant department, if necessary. Trace our results to the final count sheets by the auditees. Follow up any discrepancy.

10. 11.

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W/P Ref: INTERNAL AUDIT PROGRAMME BUSINESS UNIT: ABC SYSTEM/PROCESS: Fixed asset count Prepared by: Gary (garywu@sohu.com) Date: Nov. 28, 2001

AUDIT STEPS

REF

MATTER ARISING

DONE BY

To ensure that the counting results are properly followed up, recorded and reported. 12. Obtain the full set of count sheets upon the completion of the count and perform the following: i. ii. Scan through the count sheets to ensure that they are properly signed by the counting staff and the supervisors. Judgementally select the count sheets of 5 locations (different from the ones we select in step 5), ensure that all discrepancies noted therein are properly followed up, justified, documented, approved and updated to the fixed asset registers and accounting records.

13.

Obtain the final fixed asset counting report to management. Ensure that all exceptions and issues noted are properly reported and approved.

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