Auditing SAP processes for fixed asset and inventory

Part I of the series: “Digitization of auditing SAP Fixed Asset and Inventory Processes”

As a third series, after auditing purchase-to-pay and order-to-cash processes in SAP, a series of auditing fixed asset and inventory processes is following. In this series, all process steps in the fixed assets are carried out, as well as the data analytics which are possible along the entire process, in order to audit the entire process almost automatically.

1. Auditing SAP processes in fixed asset and inventory
2. Master Data audit of SAP fixed assets
3. How to audit fixed assets procurement in SAP
4. SAP data analytics for fixed asset depreciation
5. Auditing fixed asset retirement in SAP
6. Process analytics for SAP current asset transactions
7. Segregation of Duties in SAP asset management
8. Fixed asset data structure in SAP
9. Professional Judgement in auditing SAP fixed assets

Understanding the processes first

Before comprehensive process analytics of the fixed assets and inventories in SAP can be started, extensive data analytics should be carried out in a digital audit to ensure the knowledge of the actual processes. In my methodology, first of all, the SAP processes of the fixed assets and inventories implemented in the SAP System have to be determined empirically in the SAP database. Data analytics are only carried out on the basis of the known processes of fixed assets and inventories. The determination and reconstruction of all processes is carried out by the Financial Process Mining Algorithm I developed. Here you can find out how the reconstruction of the processes of fixed assets and inventories works methodically.

How are SAP processes in fixed assets and inventories different from other processes?

Often, the processes in the area of fixed assets are shorter than purchase-to-pay or order-to-cash processes. In the area of procurement of assets, there is an overlap with the normal purchase-to-pay process. The other processes, e.g. the posting of depreciation and the asset retirement are time- or event-related and involve only one or a few process steps. There might be corresponding overlaps with the order-to-cash process regarding asset retirement. The Financial Process Mining Algorithm also takes account of processes in the area of fixed asset and inventory, so that all individual processes in this area are known by applying the algorithm.

Data analytics for processes in fixed assets and inventories

Once all processes have been reconstructed by the Financial Process Mining Algorithm, the data analytics are carried out in the form of various data indicators. An indicator always represents a relevant audit question. As a result, a document may or may not be affected by an indicator. It records some kind of a “black-and-white image” and divides all the documents into a set of documents affected by the indicator and into a set of documents that are not affected. Examples of indicators for fixed asset and inventory are:

  • Fixed asset acquisition without an invoice
  • P&L loss at retirement or sale of asset
  • Fixed asset depreciation more than 50% of activation value

In total, I developed and implemented 22 indicators for fixed assets and inventories in SAP.

Within this series, a selection of the 22 indicators of fixed assets and inventories is explained in various articles.

This is how easy you can audit your fixed asset!

Artikel teilen


Auch interessant