Capitalizing items that are not fixed assets may result in inflated net income and assets, financial statement misstatements, fines and penalties, or reputational damage. Choose the best control activity to address this risk.

Ensure regular management review of fixed asset accounting transactions and trends in fixed asset ratios. The control owner is the CFO.

Conduct inventory count to test for existence of fixed assets. The control owner is the Internal Auditor.

Ensure regular management review of fixed asset accounting transactions and trends in fixed asset ratios. The control owner is the Internal Auditor

Conduct inventory count to test for existence of fixed assets. The control owner is the CFO.