How to Audit Fixed Assets: A Step-by-Step Guide

Quick answer: Auditing fixed assets means physically verifying that the equipment, vehicles, software, and other long-term investments on your books actually exist, are where you last recorded them, and are in the condition you expect. To audit fixed assets, you must list every asset and its location, record its condition and cost details, scan or tag it for tracking, reconcile the physical count against your fixed asset register, and update records with any discrepancies. Most organizations run a full audit at least once a year, and asset tracking software like Asset Panda automates the scanning, reconciliation, and reporting so the process takes days instead of weeks.

Knowing how to audit fixed assets is essential for any organization, no matter its industry or size. From an accounting standpoint, an annual audit may be the single most important practice for protecting investments and preventing unexpected costs.

A fixed asset audit is the process of taking stock of a company's non-current assets, or the investments and materials a company relies on for day-to-day operations. Fixed assets are usually tangible items like furniture and computer equipment, but in some cases they include intangible items like computer software. The opposite of a fixed asset is a current asset, defined as an asset the organization maintains mainly for sale or resale.

In this guide, we'll cover why fixed asset audits matter and how to complete one in Asset Panda's easy-to-use solution.

The Benefits of A Fixed Asset Audit

Taking stock of every investment you maintain, from buildings and land to vehicles, machinery, software, and computers can feel overwhelming. However, audits are an essential part of an organization's asset management and operations.

Here are the primary benefits of conducting fixed asset audits.

• Keeping assets organized: Until you perform a fixed asset audit, you may not know the full breadth of an organization's investments, where they're kept, or what they're used for. Auditing keeps your inventory orderly, secure, and accessible.
• Eliminating duplication and excess: Do you know how many computers your organization has, and whether that's the number you need? An audit shows whether you're buying more than necessary, and it can surface underutilized assets before you spend on new ones.
• Recovering lost assets: Tracking fixed assets minimizes displacement. If an asset is reported lost, a fixed asset audit serves as a record of its last known location, making it easier to track down and recover.
• Preventing surprise costs: As assets age, they depreciate in value or require repairs. An annual fixed asset audit keeps your organization aware of current asset status and prepared for repairs and eventual replacements.
• Practicing compliance: If an organization doesn't conduct annual asset audits, a regulatory or government agency may step in to do one instead. Stay ahead of that scenario by keeping transparent, responsible records independently.

Getting Started with Audits

The most crucial part of any fixed asset audit is confirming that the assets actually exist.

Start by listing the location of every asset as you audit it. To make your audit records as thorough as possible, also record each asset's appearance, condition, purchase date, original cost, and potential rate of depreciation. That's a heavy lift with pen and paper, or even an Excel spreadsheet.

Consider a fixed asset tracking platform with built-in audit capabilities. With your audit tool and asset records all in one place, you can build custom checklists and update records automatically as the audit finds discrepancies. A companion mobile app lets you move between floors or buildings without a laptop, and barcode scanning clears each item in a single scan.

Here's how to run a fixed asset audit in a purpose-built tool like Asset Panda, step by step.

Step-by-Step: Performing An Asset Audit With Asset Panda

Setting up an audit in Asset Panda takes five short steps: Setup, Record Selection, Schedule, Share, and Advanced options.

1. Set up the audit: In the navigation pane, select Tools, then Audits. Click Add to open the Audit Setup page. Enter an Audit Name and optional description, then choose the Account, Module, and Collection that contains the assets you want to audit.
2. Choose the records to audit: Asset Panda pulls up the records in your collection. Filter by field, operator, and value to narrow the list to exactly the assets you want, and choose which fields (ID, asset name, serial number) auditors will see. You can also let the list update dynamically as new matching records are added after the audit starts.
3. Schedule the audit: Set a start date (or leave it blank to begin immediately) and an end date (or leave it open until users mark the audit complete). Select the time zone that should govern the audit window.
4. Share the audit: Share the audit by role (for example, administrators or specific collaborator roles) or with individual users by name. Organization, account, and module admins have full access by default; collaborators and custom roles can only view or perform audits shared with them.
5. Configure advanced options: Decide whether auditors can mark assets as audited manually (without scanning), reset audited records back to "not audited," or bulk-audit multiple records at once. You can also require a signature before the audit closes and allow auditors to add or update records using a specific form during the audit.

Once configuration is complete, save and exit. The audit is live, and progress tracking (completion percentage, audited vs. total records, and start/end dates) is visible from the Audits page for the rest of the process. While it may be easiest to build an audit from scratch on the Asset Panda web app, our mobile audit app creates a seamless process with built-in barcode scanning using your device's camera.

Audit Your Fixed Assets Seamlessly

Auditing your fixed asset inventory can sound intimidating. Whether you've audited fixed assets before or you're starting from scratch, Asset Panda meets you where you are.

The mobile audit tool shortens the process with built-in barcode scanning and real-time data, so you can make corrections as you go. For teams focused on depreciable assets, the audit is where the fixed asset register meets physical reality. Asset Panda separates depreciable accounting assets from other tracked inventory, so finance can focus the audit on records that drive the general ledger while operations keeps tracking supporting equipment in the same system.

See for yourself why Asset Panda is one of the highest-rated asset management and auditing platforms. Request your personalized demo today.