Background A capital asset is defined as property used in a productive capacity that will benefit an enterprise beyond one accounting cycle. Not able to record our Asset accounting accurately will bring extension risk to Intel namely: Financial Impact Risk Any inaccurate materiality in our books, can affect directly Intel financial statements which includes asset depreciation. Legal Entity Risk Any time we transfer assets across legal entities (i.e., from Fab in Arizona to Fab in Israel), we are required to remove the asset from the books of Intel Corp. and add it to the books of Intel Israel. Not doing so puts us in direct violation of the "Arm's Length" relationship required in intercompany transactions. Physical Inventory & Audit risk When we perform a physical inventory, it is much harder to find equipment if our records have not been kept accurate. Consequence will be worse if there's an audit and the finding is not being able to reconcile asset from Floor to book accurately. Department or Event Name Intel Confidential intel 2 Business Case Approve Sufficient Create Asset transfer request Submit Shipment documentation Shipment to destination Custom declaration Supporting validation Intercompany Settlement Payment Accounting recognition Insufficient Write off Custom declaration sheet is a list of shipment custom documents that iterates all the necessary information about exported/imported goods. It is also proof of shipment in which goods are being physically shipped & received by receiving site. Intercompany settlement is the payment for cross company transactions within a company to fulfill arm's length principle as part of transfer pricing requirement Write off primarily refers to a business accounting expense reported to account for unreceived payments or losses on assets. Write off will be treated as non-deductible income or expenses in profit &loss statement which eventually caused the company to pay more tax Department or Event Name Intel Confidential intel 3 Supposed you are Intel Analyst, 1. Define what could be tangible and non-tangible asset for Intel 2. What would be the double entry to recognize asset transfer from Legal entity A to legal entity B? 3. What process improvement (system/automation etc..) you would suggest to the process owner to avoid write off risk for Asset transfer