Accounting Policies and Procedures Manual: A Blueprint for Running an Effective and Efficient Department, Fifth Edition

Chapter 11. Property Accounting Manual

Introduction

The weakest documentation area in many organizations is the description of various types of property. Though this may not be considered a significant issue in some service organizations that are oriented toward human capital, many other types of entities have invested a large amount of capital in land, buildings, equipment, vehicles, and leasehold improvements. In the later case, it is extremely important to maintain a high level of record accuracy so that company management maintains proper control over its investment. Good record keeping in this area is also necessary for audit reviews, cost accounting allocations, insurance claims, and warranty tracking.

This chapter is oriented toward a large number of examples of property tracking forms, which include project cost sheets, land records, land improvement records, building records, equipment records, vehicle records, leasehold improvement records, and lease records. The formats shown can be expanded to included additional information required by individual organizations.

Property accounting should be assigned to a senior accountant who will be responsible for updating and maintaining the records. This person should have a descriptive title, such as Physical Property Manager, Fixed Asset Accounting Manager, or (as used herein) Property Accounting Manager.

The amount of record keeping recommended in this chapter may appear voluminous, but it is necessary to maintain sufficient information ...