Asset Inventories 2593

  • Pardon my ignorance, I’m brand new to all of this. I was recently handed an asset inventory list that I was to verify, take photos, etc. to prove the validity of the inventory. A big deal was made that this was a SOX requirement, yada, yada, yada. I’ve been doing asset inventories for years and have fallen under many different government and corporate requirements. However, I’m having an issue understanding this one. Could someone please explain to me how to verify and to what purpose an inventory of the following items (just a few examples from my long list) serves?
    Satellite Receivers
    Satellite delivery system equip
    Studio construction
    Various studio and office furn
    Various studio equip
    Studio Construction
    Various Office Furniture
    Various Framed Artwork
    Network Operator Center System
    Studio Table
    LHI - Walls;Glass;Doors,Painting, Etc.
    These are the asset descriptions. There is no further information available, such as part numbers, make, model, location, etc.
    Could someone please tell me what chapter and verse of SOX an inventory like this meets? Is this inventory format for real, or are we really messed up? Does any body have a sample inventory run that meets SOX requirements in asset management?

  • Welcome to the forums.
    First comment is that SOX does not mandate anything at this level of detail, only that management must assess internal control over financial reporting.
    Secondly, it looks like you are facing the classic asset inventory problem - crappy decriptions 😉 I’ve definitely seen a few of these in my time including one that said ‘Assets acquired from xxxx Plc - GBPxxx million’
    It goes without saying that best practice is for all items in an asset register to be uniquely identifiable and properly described. If this does not happen then verification can be extremely difficult. Of course, everyone does face the issue of describing some assets and one can reach the point where the effort to individually tag low value or difficult to describe assets is not worth it.
    That said, what you describe is very poor and surely makes verification of the existence - and value - of those assets difficult.
    If you find a situation where you can’t verify assets due to quality of tagging, descriptions, etc then you may have a SOX deficiency - however you will need to consider the materiality of the assets involved. If you are talking thousands of dollars out of millions then you might not be too fussed however if it is significant to the total then you may have a SOX issue.

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