1. Purpose of a Fixed Asset Register (FAR)
The Fixed Asset Register (FAR) is a detailed subsidiary database kept outside the main general ledger. It tracks individual records for every non-current asset owned by the business. Each asset entry contains critical details, including its unique serial number, asset code, physical location, purchase date, cost, depreciation method, and current net book value.
2. Internal Control and Verification
The FAR is an important tool for internal control. At least once a year, managers should perform a physical inspection of assets to ensure the items listed in the register actually exist and are in working condition. This step helps detect theft, unrecorded asset write-offs, or damage.
3. Reconciliation Protocols
At period-end, the total value of all assets listed in the Fixed Asset Register must match the summary balances in the General Ledger.
   FIXED ASSET DATABASE RECONCILIATION
=============================================================================
General Ledger Summary Accounts:
  Machinery Cost Control Account Total:             $450,000
  Less: Machinery Accum. Depreciation Total:       ($120,000)
                                                    --------
  General Ledger Net Book Value (NBV):              $330,000
                                                    ========

Subsidiary Fixed Asset Register Summary:
  Sum of all individual machinery items in FAR:     $330,000
=============================================================================
Verification: General Ledger and FAR match. Audit trail is verified.

If these totals do not match, accountants must review purchase journals, disposal files, and depreciation logs to resolve the differences.
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