From the Inside Out.
"A balance sheet showing AED 50 million of property and equipment means nothing if those assets haven't been physically verified in three years. The ledger records what once existed — verification confirms what exists today."
— Finerio Verification Practice
Do Your Fixed Assets Actually Exist?
Fixed Asset Verification is an independent physical inspection of your company's tangible assets — plant, equipment, machinery, vehicles, furniture, IT hardware, and investment property — to confirm that the assets recorded in your Fixed Asset Register (FAR) actually exist, are in the stated location, are in the described condition, and are still being used for the purpose assumed in your depreciation policy.
Fixed assets are often one of the largest items on a company's balance sheet. Yet many businesses have a Fixed Asset Register that has not been physically verified for years — containing assets that have been disposed of, lost, transferred, or rendered obsolete without being removed. This leads to overstated assets, incorrect depreciation, and financial statements that do not reflect reality.
Finerio conducts independent fixed asset physical verification exercises — tagging assets, reconciling findings to the FAR, identifying discrepancies, and preparing a clean, auditor-ready fixed asset register. This service is critical for year-end audit preparation, insurance valuations, and any business undergoing restructuring, acquisition, or IFRS first-time adoption.
Fixed asset verification explained plainly
Finance teams, auditors, and insurers describe this service using a range of terms — all referring to the same physical existence and register reconciliation exercise.
What We Deliver
End-to-end fixed asset verification and reconciliation — from physical tagging through to auditor-ready FAR submission.
Step by Step — Our Asset Verification Exercise
What our team does at each stage of a fixed asset physical verification engagement — from planning through to report delivery.
Pre-Verification Planning
We obtain the current Fixed Asset Register, group assets by location and category, prepare verification checklists, and schedule site visits — minimising disruption to your operations throughout.
Site Visit Briefing
We brief your facilities and operations teams on the verification objectives, access requirements, and process — ensuring cooperation and minimising interruptions during the physical count.
Physical Count & Tagging
Our team physically locates, inspects, and records each asset — confirming serial numbers, descriptions, location codes, condition ratings, and whether the asset is in active use — applying asset tags where not already labelled.
Unregistered Asset Recording
Assets found during inspection that are not in the FAR are recorded and investigated — determining whether they are unrecorded additions, leased assets, or items belonging to third parties.
FAR vs Physical Comparison
Physical count results are compared to the FAR line by line — identifying every discrepancy: assets on register but not found; assets found but not on register; and mismatches in location or description.
Discrepancy Investigation
Material discrepancies are investigated with operations and finance teams — determining root causes (disposal without recording, transfer without update, classification error) and agreeing the correct accounting treatment for each.
Depreciation & Useful Life Review
Useful life, residual value, and depreciation method are reviewed for each asset category against IAS 16 — identifying categories where a prospective change in estimate is appropriate.
FAR Update, Cleansing & Report
The Fixed Asset Register is updated to reflect all verification findings — additions, disposals, location corrections, condition notes — resulting in a cleansed FAR reconciled to the general ledger, with a formal verification report delivered to management and auditors.
Questions we hear from clients every week.
Everything you need to know about fixed asset verification and reconciliation.
Best practice — and the expectation of most external auditors — is that fixed assets should be physically verified at least annually, typically as part of year-end audit preparation. High-value asset categories should be verified every year without exception. For organisations with large, well-tagged asset bases, a rolling verification programme (different locations or categories each year, completing the full register every 3 years) can be acceptable — provided the FAR and tagging system are maintained accurately throughout the year.
Assets recorded in the FAR that cannot be physically found are classified as unlocated assets. We investigate: Have they been disposed of without being removed from the register? Transferred to another location? Lost or scrapped? Once the reason is determined, the appropriate accounting treatment is applied — write-off if genuinely gone (with gain/loss on disposal recorded); location correction if misallocated; or reclassification to Assets Held for Sale under IFRS 5 if intended for disposal. Auditors treat significant unlocated assets as a material concern — resolving them before fieldwork is critical.
Under IAS 36, an asset is impaired when its carrying value in the balance sheet exceeds its recoverable amount. During a physical verification, our team identifies impairment indicators — assets that are damaged, idle, technologically obsolete, or no longer generating expected returns. When indicators are found, a formal impairment assessment is required. We document the indicators, advise on the test methodology, and prepare the accounting entries and disclosures required. Ignoring impairment indicators — which physical verification makes visible — results in overstated assets.
Capital expenditure (Capex) creates or enhances a long-term asset — it is recorded in the FAR and depreciated over the asset's useful life. Revenue expenditure (Opex) maintains an existing asset or is consumed within the current period — it is expensed immediately. IAS 16 provides the criteria for capitalisation: the expenditure must be probable to generate future economic benefits and its cost must be reliably measurable. Misclassifying Opex as Capex overstates assets and profits; misclassifying Capex as Opex understates both. We review capitalisation policies and classify transactions correctly during every engagement.
Yes — for clients with operations across multiple UAE emirates or international locations, we deploy teams for simultaneous or rolling verification exercises. Simultaneous verification provides a single consistent count date, important for asset-heavy balance sheets. Rolling verification spreads the exercise over several months, minimising disruption. Both approaches are coordinated through a central management system, with all results consolidated into a single reconciliation and report. We have conducted exercises across Dubai, Abu Dhabi, Sharjah, Ras Al Khaimah, and across GCC markets.
Assets not verified in years?
Whether you're preparing for a year-end audit, an acquisition, an insurance revaluation, or simply cleaning up a neglected FAR — we can help you get the asset register right.