Property, plant, and equipment is normally audited in a different manner than current asset accounts. State three reasons why this is so, and discuss the differences in how property, plant, and equipment is audited compared to current assets

What will be an ideal response?

• There are usually fewer current period acquisitions of property, plant, and equipment than current assets.
• The amount of any given acquisition is often material.
• The equipment is likely to be kept and maintained in the accounting records for several years.

Because of these three differences, the emphasis in auditing property, plant, and equipment is on the verification of current period acquisitions rather than on the balance in the account carried forward from the preceding year. In addition, the expected life of assets over one year requires depreciation expense and accumulated depreciation accounts, which are verified as a part of the audit of the assets.