Real estate is the most important part of any company’s assets. It is associate with the use of real estate properties. That is associate with the main production activity of any company, because of the real estate production process.
As we already discus about real estate is the most important part of any company’s assets. This is the basis of the real estate production process. Because the main production activity of any company is associate with the use of real estate. To prevent any violation in the accounting of real estates, an audit of operations with real estate sits.
What is include in this type of audit? Audit of transactions with real estate includes examination of all documents. Acquired by the enterprise, utilization, depreciation and selling after the end of their useful life at a cost referred to. As residual to audit operations with real estate. This all documentary is belongs to 5G properties. 5G properties is the leading real estate company also top seller of Lahore Smart City. It is necessary to examine the fulfillment of the following criteria:
Existence of Object for Which the Check is Carried Out
For this, it is necessary to take a list of objects that are subject to verification. In fact, the presence of all objects displayed in inventory documents is a personal check by the auditor. If any object of the does not actually exist. Or they are not in the position in which they are describe. The auditor should make appropriate notes in the documents working and put them in conclusion.
Ownership of Real Estates Located in the Enterprise
At this stage, the auditor has to determine whether the real estate is actually own by the company. And whether it is solely their right to dispose of. as a rule, it is link to verification of payments for purchased items, so, after checking it is often necessary to audit cash transactions.
Evaluation to Complete the Check
Its results show a holistic picture of the enterprise’s status, it is necessary to find out whether all items have been properly evaluate. in addition to assessing the primary cost of real estates and determining their residual value, which will be the selling price of real estates after the end of use, this item also includes an increase in depreciation, or, as it is also called depreciation, regular for a special reserve created to be able to buy new operating systems to replace those who have already worked there is a cut.
since the cost of real estate, as a rule, is the largest share of an enterprise’s property, it means that it is at the expense of real estates that make up the bulk of the company’s assets, and hence its value. The value of a firm is reflect in the value of its shares. It is therefore necessary to understand that the discrepancies identified in the can increase the need to conduct audits of transactions with securities.
in general, checking the operating status with is an important moment in the life of any enterprise, as it allows management to imagine the overall picture of what is happening with the real estate is the most important tool for maintaining a company’s stable financial position for operations, as it does not give an opportunity to get into trouble due to incorrect valuation and depreciation on incorrect assets. This inquiry is not conduct as often as other types of audits. But to maintain the enterprise’s position at the optimum point, it is recommend to audit operations with real estate stake dispersal at least once every three years.
We hope that reading this article will help young accountants and auditors to deal with such a difficult issue, such as checking the status of operations in an enterprise, and that company leaders will need to conduct such regular checks.