FIXED ASSET INVENTORY AND RECONCILIATION
An accurate Fixed Asset Inventory helps identify common issues many companies face, such as ghost assets, partial retirements, assets eligible for exemption, assets eligible for beneficial classification and embedded non-taxable costs. For these companies, we conduct line-by-line reviews of both owned and leased assets, and reconcile the assets on the floor to those on the balance sheet.
When Meguire CPA performs a Fixed Asset Inventory, we tailor out our findings for each client and focuses only on information that is valuable to your company. Our inventory includes collection of standard data such as make, model, serial number, maintenance number, product line, status and location. It can also include state-specific tax planning, including identification of idle assets, pollution control equipment, non-taxable intangibles, fair market value appeal considerations and documentation to support amended personal property statements. Digital photographs enhance the inventory by providing better documentation and understanding of the inventoried equipment.
Benefits of Fixed Asset Inventory and Reconciliation include:
- It can pay for itself — Clients can see a potential 30-40% reduction to property taxes, income taxes and insurance premiums.
- Reduced property taxes — Recognizing previously unrecorded disposals will prevent over-reporting on personal property tax returns. Tax liabilities will be reduced in the future and in some cases, the two most recent tax years. Additional tax planning can be incorporated into the process, including identification of partial retirements, exempt assets (e.g., software, intangibles and pollution control equipment), maximization of abatements, as well as assets eligible for beneficial depreciation.
- Reduced income taxes — Assets physically disposed of in a prior year, but which are still capitalized and depreciated for Federal and State income taxes, can be written off in the current year. Any un-depreciated tax basis will be written-off against current year taxable income.
- Audit confidence — Independent verification of assets provides assurance in the face of government audit and compliance with Sarbanes-Oxley, J-SOx and similar regulations is enhanced. Our process can be tailored to fit you internal control requirements and assist in meeting the strict testing necessary to assure the confidence of the financial statements.
- Avoid unnecessary purchases — Idle assets identified by the process can be efficiently redeployed to areas of need