You were just hired as an accountant for ABC Company.One of your first assignments is to verify the fixed asset listing to ensure the assets listed are owned by the company, are physically located in the building, and are being depreciated appropriately.In the process of verifying the location of all the fixed assets on the listing, you could not help but notice there were significant fixed assets present in the company that were not on your list.You approach your supervisor to discuss these findings and she gets very defensive and says, "I just asked you to verify that the ones on the list were present; not to make sure everything you see is on the list.Just do what I asked you to do."

. First of all, what are the accounting problems with assets being in the building that are not properly recorded on the fixed asset listing (and therefore on the balance sheet as fixed assets)?

2. If they are not recorded as fixed assets, what are the other possibilities?