Substantive procedure for PPE/NCA

This topic has 3 replies, 2 voices, and was last updated 8 years ago by Ken Garrett.

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May 11, 2018 at 8:44 am #451182
humai
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Sir in substantive procedure for valuation of PPE/NCA is the following procedure correct
Hire an independent expert and ask him to value market value of PPE/NCA to see whether it has been recorded at fair value or not
May 11, 2018 at 11:41 am #451216
Ken Garrett
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Not usually.
PPE/NCA are usually valued at cost less depreciation. Fair value implies they are going to be sold (= value under an arm’s length purchase/sale).
May 11, 2018 at 2:15 pm #451230
humai
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So does writing this substantive procedure as following is correct?
Hire an independant expert and ask him to value market value of PPE/NCA to see whether it has been recorded at cost less depreciation or not
May 11, 2018 at 4:34 pm #451249
Ken Garrett
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No. Why on earth do you need an expert to check cost less depreciation? Market value is mostly irrelevant for non-current assets.
You need to think more before asking questions.
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