This is true since fixed asset evaluation and record keeping typically require both strong accounting abilities and a thorough understanding of property law. The Indian Accounting Standard (AS) 10 - Fixed Assets Accounting will provide the foundation for the audit of fixed assets.

Step 1 : Physical observation

This is easy. An auditor examines the assets with their eyes and records important information such as the asset's location, size (for lands and buildings), date of purchase, value at the time of purchase, ownership documents, property tax compliances (for lands and buildings), receipt of purchase & serial no. (for equipments), and other crucial information.

Step 2 : Creating a log book

Every detail is recorded and all the assets are entered into a journal . Each asset entry includes relevant papers that are saved as well as attached.

Step 3 : Calculation of Current value & Depreciation

With time, certain assets degrade in value, while others appreciate in value. Some fixed assets (equipment, machinery, etc.) depreciate over time owing to wear and tear or the development of superior technologies.

In order to determine whether ongoing use with maintenance or selling the asset is economically prudent, it is crucial to determine the current value of a fixed asset.