What it is
Property, plant and equipment is tested for existence, ownership, capitalization versus expense, depreciation and impairment. In most audits additions and disposals are tested individually and the rest is covered by analytics and recalculation.
This program covers the rollforward, additions and disposals, depreciation, impairment indicators under ASC 360, capitalized interest, asset retirement obligations and leases, together with presentation and disclosure.
When to use it
- Planning the PP&E section of an audit.
- In a year with significant construction, acquisitions, disposals or a change in estimated useful lives.
- Alongside the fixed asset rollforward and additions testing workpaper.
What’s inside
- Rollforward agreed to prior year and the general ledger
- Additions: vouching, capitalization policy, construction in progress and capitalized interest
- Disposals, gains and losses, and existence by inspection
- Depreciation recalculation, useful life and method review
- Impairment indicators (ASC 360), ARO (ASC 410), leased assets and disclosure
Standard cited
This template follows AU-C 330 / ASC 360. It is written in our own words, except for phrases the standard requires the document to contain, with [bracketed placeholders] for client details, amounts in USD and dates as MM/DD/YYYY. Check it against the current standard and your firm’s methodology before use. See AU-C 330 explained.
Questions
How is a repair different from an addition?
Costs that extend an asset’s life, increase its capacity or improve its efficiency are generally capitalized. Routine maintenance that keeps the asset in working order is expensed. Test a sample of large repair and maintenance expenses for items that should have been capitalized.
When must impairment be tested under ASC 360?
Long-lived assets held and used are tested for recoverability when events or changes in circumstances indicate the carrying amount may not be recoverable, such as a significant fall in market price, adverse change in use or continuing operating losses.
Related templates
- Fixed Asset Rollforward (Excel)
- Fixed Asset Additions Testing Workpaper
- Audit Program: Debt and Equity
Last updated 11/04/2026. All free templates.