Fixed Assets (FA) Interview Questions.

 Fixed Assets (FA) Interview Questions.

❓. What are the key steps in the capitalization process of fixed assets? 🅰️: The process includes identifying the asset acquisition, determining the cost, allocating costs to the correct asset category, recording the asset in the FA register, and ensuring proper classification and compliance with accounting standards. ❓. How do you manage fixed asset depreciation, and which methods do you use? 🅰️: Depreciation is managed by applying a systematic method to allocate the cost of an asset over its useful life. Common methods include straight-line and declining balance. The selection depends on the company's accounting policy. ❓. Can you explain the disposal accounting process for fixed assets? 🅰️: Disposal of assets involves removing the asset from the balance sheet, recording any proceeds from the sale, and recognizing any gain or loss from the disposal. The entries would include removing the asset cost and accumulated depreciation from the books. ❓. What are the challenges you face during month-end activities related to fixed assets? 🅰️: Challenges include ensuring accurate FA register updates, reconciling discrepancies between FA and general ledger, timely depreciation runs, and addressing any audit or reporting issues that arise close to the closing date. ❓. How do you perform FA GL Reconciliation? 🅰️: FA GL reconciliation involves matching the fixed asset register with the general ledger. Any discrepancies are investigated by reviewing transactions like additions, disposals, and depreciation. Adjustments are made to resolve the differences. ❓. What is CWIP, and how do you handle CWIP GL reconciliation and aging? 🅰️: CWIP (Capital Work in Progress) refers to expenses for assets that are not yet ready for use. CWIP GL reconciliation ensures that all CWIP-related costs are properly accounted for, and aging reports help track the progress and timeline of capital projects. ❓. How do you ensure compliance with accounting policies and guidelines during FA processes? 🅰️: This is ensured by staying updated with relevant accounting standards like IFRS or GAAP, following internal controls, and adhering to policies set by the Process Control team. Regular reviews and audits help identify areas for compliance improvements. ❓. How do you handle depreciation variance analysis? 🅰️: Depreciation variance analysis involves comparing actual depreciation expenses with projected amounts. Variances are analyzed by reviewing changes in asset acquisition, disposal, useful life reassessments, or depreciation methods. ❓. What steps do you take to ensure the smooth conduct of audits with minimum escalations? 🅰️: Ensuring audit readiness involves keeping thorough documentation, timely reconciliation, compliance with accounting policies, resolving queries from auditors promptly, and addressing potential issues proactively during internal reviews.