Summary of Assertions and Procedures

 

Assertion	Key Question	Example of Audit Procedure
Occurrence	Did the transaction genuinely happen?	Inspect invoices for PPE purchases
Completeness	Has every asset or disposal been recorded?	Trace physical assets to the PPE register
Accuracy	Is the amount correct?	Compare the recorded cost with the invoice
Cut-off	Is the transaction recorded in the correct year?	Inspect invoices before and after year-end
Classification	Is the transaction recorded in the correct account?	Review repairs and maintenance expenses
Existence	Does the recorded asset physically exist?	Select assets from the register and inspect them
Rights and obligations	Does the company legally own or control the asset?	Inspect title deeds or registration documents
Valuation and allocation	Is PPE valued correctly?	Recalculate depreciation
Presentation and disclosure	Is PPE properly shown in the financial statements?	Review financial statement notes

PPE Register

A PPE register is an important document used by the company and the auditor.

A good PPE register normally includes:

Information	Example
Asset description	Toyota Hilux
Asset identification number	VEH-2025-008
Purchase date	15 March 2025
Cost	RM120,000
Location	Kuantan Branch
Depreciation method	Straight-line method
Useful life	Five years
Accumulated depreciation	RM24,000
Carrying amount	RM96,000
Disposal details	Not applicable

The auditor uses the PPE register to select assets for inspection, recalculate depreciation and review additions and disposals.

Audit of PPE Disposals

When a PPE item is sold or scrapped, the auditor should ensure that:

• The disposal was properly authorised.
• Sales proceeds were recorded.
• The asset's cost was removed from the records.
• Accumulated depreciation was removed.
• The gain or loss on disposal was correctly calculated.
• The asset was removed from the PPE register.

Disposal Example

A machine has:

• Cost: RM80,000
• Accumulated depreciation: RM60,000
• Carrying amount: RM20,000
• Selling price: RM25,000

$$\text{Gain on Disposal} = \text{Selling Price} - \text{Carrying Amount}$$ $$= \text{RM25,000} - \text{RM20,000} = \text{RM5,000}$$

The company should record a gain on disposal of RM5,000.

Audit of PPE Additions

When checking new PPE purchases, the auditor should inspect:

Audit Evidence	Purpose
Purchase invoice	To verify the purchase price
Purchase agreement	To confirm the terms of the purchase
Payment records	To confirm that payment was made
Board approval	To confirm authorisation for major purchases
Physical asset	To confirm existence
PPE register entry	To confirm the asset was properly recorded
Depreciation calculation	To check whether depreciation begins at the correct time

Example

A company purchases a new machine for RM250,000.

The auditor should:

1. Inspect the supplier's invoice.
2. Check the authorised purchase order.
3. Trace the payment to the bank statement.
4. Inspect the machine physically.
5. Check the asset tag and serial number.
6. Trace the machine to the PPE register.
7. Recalculate depreciation.

Capital Expenditure Versus Revenue Expenditure

One important audit issue is determining whether expenditure should be recorded as an asset or as an expense.

Type of Expenditure	Accounting Treatment	Example
Capital expenditure	Recorded as PPE	Purchase of a new delivery van
Capital expenditure	Added to the cost of an existing asset	Major upgrade that extends a machine's useful life
Revenue expenditure	Recorded as an expense	Routine servicing of a delivery van
Revenue expenditure	Recorded as an expense	Minor repairs to office furniture

Why Is This Important?

If a company incorrectly records repair expenses as PPE:

• PPE will be overstated.
• Expenses will be understated.
• Profit will be overstated.

Example

A company spends RM4,000 repairing a machine and records it as a PPE addition.

Correct treatment:

Dr Repairs and Maintenance Expense      RM4,000
     Cr Cash or Payables                         RM4,000

Incorrect capitalisation would cause both PPE and profit to be overstated.

Substantive Audit Procedures for PPE - Presentation and Disclosure

Presentation and Disclosure

Audit Objective

To ensure that PPE balances and related information are properly presented in the financial statements.

Audit Procedures

The auditor may:

• Check whether PPE is correctly classified as a non-current asset.
• Inspect the company's accounting policies.
• Review disclosures relating to depreciation methods and useful lives.
• Verify movements in cost and accumulated depreciation.
• Check whether pledged assets have been disclosed.
• Review the disclosure of significant lease arrangements.
• Confirm that gains or losses from disposals are properly presented.

The procedures in the uploaded slides also emphasise reviewing asset movements during the year and ensuring that disclosures are appropriate. 

Substantive Audit Procedures for PPE - Valuation and Allocation

Valuation and Allocation

Audit Objective

To ensure that PPE is recorded at an appropriate amount and depreciation is correctly calculated.

Audit Procedures

The auditor may:

• Inspect invoices and purchase documentation for PPE additions.
• Check whether directly attributable costs have been included appropriately.
• Recalculate depreciation.
• Check the depreciation method, useful life and residual value.
• Review the gain or loss on disposal.
• Inspect valuation reports for revalued assets.
• Evaluate the competence, capability and objectivity of an external valuer.
• Check for signs of impairment, such as damaged or obsolete equipment.

Depreciation Example

A machine costs RM100,000. Its residual value is RM10,000 and its useful life is five years.

Using the straight-line method:

$$\text{Annual Depreciation} = \frac{\text{Cost} - \text{Residual Value}}{\text{Useful Life}}$$

$$= \frac{\text{RM100,000} - \text{RM10,000}}{5} = \text{RM18,000 per year}$$

The auditor should recalculate the depreciation and compare it with the amount recorded by the client.

Substantive Audit Procedures for PPE - Rights and Obligations

Rights and Obligations

Audit Objective

To ensure that the company owns the asset or has a valid right to use it.

Audit Procedures

The documents inspected depend on the type of asset.

PPE Type	Supporting Document
Freehold land and buildings	Title deed
Leasehold property	Lease agreement
Motor vehicles	Vehicle registration document
Machinery and office equipment	Purchase invoice
Leased assets	Lease contract

These examples are also highlighted in the substantive procedures table in the uploaded slides. 

Substantive Audit Procedures for PPE - Existence

Existence

Audit Objective

To ensure that recorded PPE assets physically exist.

Audit Procedures

The auditor may:

• Select items from the PPE register.
• Visit the company's premises.
• Physically inspect the selected assets.
• Check the serial number, asset tag and location.
• Confirm whether the asset is still being used.

Example

A company records 20 delivery vans. The auditor selects five vans from the register and inspects them at the company's parking area.

• Assertion tested: Existence

Substantive Audit Procedures for PPE - Completeness

Completeness

Audit Objective

To ensure that all PPE additions and disposals have been recorded.

Audit Procedures

The auditor may:

• Select physical assets observed at the business premises and trace them to the PPE register.
• Check purchase invoices and supporting documents for newly acquired PPE.
• Review board of directors' meeting minutes for approval of major purchases or disposals.
• Inspect disposal documents to ensure assets sold or scrapped have been removed from the register.
• Review repairs and maintenance expenses to identify items that should possibly be capitalised.

Example

The auditor notices a newly installed air-conditioning system during a physical inspection. The auditor checks whether it is included in the PPE register.

• Assertion tested: Completeness

Common Risks in the Audit of PPE

Risk	Possible Misstatement
A fictitious asset is recorded	PPE is overstated
A disposed asset remains in the register	PPE and accumulated depreciation are overstated
Repair costs are recorded as assets	PPE and profit are overstated
Major improvements are recorded as expenses	PPE and profit are understated
Depreciation is not recorded	PPE and profit are overstated
Incorrect useful life is used	Depreciation expense is incorrect
Asset purchased near year-end is recorded in the wrong period	Cut-off error
Company records an asset that it does not legally own	Rights and obligations issue
Revalued assets use an unreasonable valuation	PPE is misstated

Developing the Audit Plan for PPE

When planning the audit, the auditor should consider the nature and size of PPE transactions.

The uploaded slides emphasise three important planning considerations:

Factor	Why It Matters
Materiality	PPE amounts may be large enough to influence users' decisions
Inherent risk	Certain PPE transactions are more likely to contain errors or irregularities
PPE register	The register provides detailed information required for audit testing

Why Auditors Often Use a Substantive Approach

PPE purchases and disposals are usually infrequent but individually material. Therefore, auditors commonly focus on substantive procedures rather than relying heavily on tests of controls.

For example, instead of testing a large number of internal control activities, the auditor may directly inspect the invoice, approval documents and physical asset for a major machine purchased during the year.

Presentation and Disclosure Objectives

These objectives focus on how PPE information is shown in the financial statements and notes to the accounts.

The auditor should check whether the company has properly disclosed:

• The cost or valuation of PPE
• Depreciation methods
• Useful lives or depreciation rates
• Accumulated depreciation
• Additions and disposals during the year
• Assets pledged as security for loans
• Relevant lease arrangements
• Accounting policies relating to PPE

The disclosure must also be clear, properly classified and supported by accurate figures.

Balance-Related Audit Objectives

These objectives focus on PPE balances reported at the end of the financial year.

Assertion	What the Auditor Wants to Confirm	Example
Existence	Recorded assets physically exist and are still in use	A vehicle listed in the PPE register can be physically inspected
Rights and obligations	The company owns the asset or has the legal right to use it	The company's name appears on the vehicle registration document
Completeness	All PPE used by the business has been included in the records	A newly purchased photocopy machine is included in the register
Valuation and allocation	PPE is reported at an appropriate amount	Depreciation has been calculated correctly

Important Distinction

Students frequently confuse existence and completeness.

Assertion	Direction of Testing	Purpose
Existence	Start from the accounting records and inspect the physical asset	To ensure recorded assets are real
Completeness	Start from physical assets and trace them to the accounting records	To ensure no assets have been omitted

Example

An auditor selects a machine from the PPE register and walks to the factory to inspect it.

• Assertion tested: Existence

An auditor walks around the factory, notices a new machine and checks whether it is included in the PPE register.

• Assertion tested: Completeness

Transaction-Related Audit Objectives

The auditor must obtain sufficient appropriate audit evidence to determine whether PPE has been properly recorded and disclosed in the financial statements.

Audit objectives can be divided into three groups:

1. Transaction-related objectives
2. Balance-related objectives
3. Presentation and disclosure objectives

These objectives apply to transactions such as purchases and disposals of PPE during the year.

Assertion	What the Auditor Wants to Confirm	Example
Occurrence	Recorded additions and disposals genuinely happened	A machine recorded as purchased was actually acquired
Completeness	All PPE purchases and disposals have been recorded	A lorry sold during the year has been removed from the PPE register
Accuracy	Transactions have been recorded at the correct amounts	A machine costing RM80,000 is not recorded as RM8,000
Cut-off	Transactions are recorded in the correct accounting period	Equipment received after year-end is not recorded as a current-year purchase
Classification	Transactions are recorded in the correct accounts	Routine repair costs are recorded as expenses, not as new machinery

Conclusion

For PPE transactions, ask:

Did the transaction happen, was everything recorded, was the amount correct, was it recorded in the correct year, and was it placed in the correct account?

Important PPE Terms

Term	Simple Meaning
Addition	A new PPE item purchased or constructed during the year
Disposal	A PPE item sold, scrapped or removed from use
Depreciation	Allocation of the cost of an asset over its useful life
Accumulated depreciation	Total depreciation charged from the date the asset was first used
Carrying amount	Cost or valuation of PPE minus accumulated depreciation and impairment losses
Capital expenditure	Expenditure recorded as an asset because it provides benefits for more than one accounting period
Revenue expenditure	Routine expenditure recorded as an expense, such as repairs and maintenance
PPE register	A detailed list of the company's PPE items, sometimes called a fixed asset register or plant register
Impairment	A reduction in the recoverable value of an asset

Why Is the Audit of PPE Important?

PPE transactions may not occur frequently, but each transaction can involve a large amount of money. For example, a company may purchase only one new machine during the year, but the machine could cost RM500,000.

Auditors must pay close attention to PPE because:

• PPE often represents a significant portion of a company's total assets.
• The purchase or disposal of PPE may materially affect profit.
• Depreciation must be calculated correctly.
• Assets may be recorded even though they do not physically exist.
• Old or damaged assets may remain in the accounting records.
• Repair expenses may be incorrectly capitalised as assets.
• Assets may be sold but not removed from the PPE register.

A key concern is that PPE is more likely to be overstated than understated.

Audit of Property, Plant and Equipment (PPE)

1. Meaning of Property, Plant and Equipment
2. Why Is the Audit of PPE Important?
3. Important PPE Terms
4. Audit objectives can be divided into three groups:
• Transaction-related objectives
• Balance-related objectives
• Presentation and disclosure objectives
5. Developing the Audit Plan for PPE
6. Common Risks in the Audit of PPE
7. Substantive Audit Procedures for PPE
• Completeness
• Existence
• Rights and Obligations
• Valuation and Allocation
• Presentation and Disclosure
8. Capital Expenditure Versus Revenue Expenditure
9. Audit of PPE Additions
10. Audit of PPE Disposals
11. PPE Register
12. Summary of Assertions and Procedures

Meaning of Property, Plant and Equipment

Meaning of Property, Plant and Equipment

Property, Plant and Equipment (PPE) are non-current assets used by a business to support its operations. These assets are normally used for more than one accounting period and are not purchased for immediate resale.

Examples of PPE include:

Category	Examples
Property	Land, factory buildings, office buildings and warehouses
Plant	Machinery, production equipment and manufacturing systems
Equipment	Computers, office furniture, air conditioners and photocopy machines
Vehicles	Cars, vans, lorries and delivery motorcycles

PPE may be owned by the business or held under an appropriate lease arrangement. The slides identify land and buildings, machinery, vehicles, furniture and other equipment as common PPE categories. 

Prompts

Others

1. An authentic FIFA Trading Card Style Prompt

An authentic FIFA Trading Card Style Prompt

Create a premium portrait-format poster in an authentic FIFA Trading Card Style, inspired by high-end collectible football player cards. The design should feature a sophisticated trading card frame with a modern and luxurious layout, showcasing the subject as a professional [NATIONAL TEAM] player. Include a realistic player rating section, [NATIONAL TEAM] national badge/crest, player information elements, and subtle holographic foil effects that enhance the premium collectible-card appearance.

The subject must wear a stylish and modern [NATIONAL TEAM] jersey, selecting a design variation that feels fresh, fashionable, and visually distinctive rather than generic or repetitive. The jersey should accurately reflect the colors, identity, and visual character associated with [NATIONAL TEAM], while maintaining a premium contemporary sportswear aesthetic.

Avoid copying the exact pose from the reference image. Instead, create a dynamic, elegant, and confident pose with natural body language, strong posture, and expressive facial emotion. The subject should embody the presence of an international football superstar and fashion model, appearing charismatic, energetic, powerful, and sophisticated rather than stiff, flat, or static.

Enhance the composition with football-themed decorative elements that complement the FIFA trading card aesthetic, such as holographic accents, metallic textures, geometric patterns, premium card details, dynamic light streaks, subtle particle effects, championship-inspired ornaments, modern sports graphics, collectible-card embellishments, layered visual depth, and luxury finishing details. Every element should feel purposeful, balanced, and professionally integrated, creating a visually rich yet clean collector-card presentation.

Include realistic trading-card information such as:

• Player Name: [PLAYER NAME]

• National Team: [NATIONAL TEAM]

• Position: [POSITION]

• Rating: [RATING]

• Age: [AGE]

• Number: [JERSEY NUMBER]

• Additional Stats: [CUSTOM STATS]

Typography must be highly eye-catching, premium, and contemporary. Use bold, stylish, and distinctive sports-inspired fonts for player ratings, names, statistics, and supporting text. Avoid plain, generic, or standard typography. The text hierarchy should be strong, dynamic, and visually engaging, contributing significantly to the premium trading-card experience.

The background should be designed to complement the visual identity of [NATIONAL TEAM], incorporating subtle national-inspired motifs, modern sports branding elements, premium lighting effects, dimensional textures, atmospheric depth, and sophisticated graphic design details without becoming cluttered or distracting.

The overall poster should feel modern, trendy, luxurious, collectible, and social-media-worthy, with strong visual impact and elite professional football branding aesthetics. Avoid anything that looks monotonous, mediocre, outdated, low-effort, overused, or template-based. Ultra-detailed realistic rendering, premium cinematic lighting, razor-sharp textures, depth-rich composition, professional sports graphic design quality, luxury collectible-card presentation, stunning 8K resolution, masterpiece-level execution.

Registered

Memahami Konsep FINTECH

E-Pembayaran dan Cryptocurrency

Nota mesra pelajar berasaskan pendekatan literasi kewangan AKPK

1. Apakah Maksud FINTECH?

FINTECH ialah singkatan kepada financial technology atau teknologi kewangan. FINTECH merujuk kepada penggunaan teknologi digital untuk memudahkan urusan kewangan seperti pembayaran, pemindahan wang, simpanan, pelaburan dan pembiayaan.

Matlamat utama FINTECH adalah untuk menjadikan transaksi kewangan lebih cepat, mudah dan efisien. Walau bagaimanapun, pengguna perlu mengamalkan pengurusan kewangan secara berhemah dan memahami risiko sebelum menggunakan sesuatu kemudahan digital.

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2. E-Pembayaran

E-pembayaran ialah kaedah membuat bayaran secara elektronik tanpa menggunakan wang tunai fizikal.

Contoh e-pembayaran

Kaedah	Contoh penggunaan
Kad debit atau kad kredit	Membayar barangan di kedai atau laman web
Perbankan dalam talian	Membayar bil dan memindahkan wang
DuitNow QR	Mengimbas kod QR untuk membuat bayaran
E-dompet	Membayar makanan, pengangkutan atau pembelian harian
Pindahan segera	Memindahkan wang kepada individu atau organisasi

Kelebihan e-pembayaran

E-pembayaran memudahkan pengguna membuat transaksi dengan pantas. Pengguna juga dapat menyemak rekod perbelanjaan melalui aplikasi atau penyata bank. Hal ini membantu proses penyediaan bajet dan pemantauan aliran tunai.

Risiko e-pembayaran

Antara risiko yang perlu diberi perhatian ialah penipuan dalam talian, pautan palsu, kebocoran kata laluan, kehilangan telefon pintar dan pembelian impulsif. Kemudahan membayar hanya dengan beberapa klik boleh menyebabkan pengguna berbelanja tanpa perancangan.

Amalan selamat

Gunakan aplikasi rasmi, aktifkan pengesahan dua faktor, jangan berkongsi nombor PIN atau kod OTP dan semak nama penerima sebelum mengesahkan transaksi. Elakkan mengklik pautan pembayaran yang mencurigakan.

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3. Cryptocurrency

Cryptocurrency atau mata wang kripto ialah aset digital yang menggunakan teknologi kriptografi untuk merekod dan melindungi transaksi. Antara contoh yang terkenal ialah Bitcoin dan Ether.

Di Malaysia, aset digital bukan mata wang sah atau legal tender. Cryptocurrency juga bukan instrumen pembayaran yang dikawal selia oleh Bank Negara Malaysia seperti Ringgit Malaysia. Walau bagaimanapun, aktiviti perdagangan aset digital melalui bursa tertentu tertakluk kepada pengawasan Suruhanjaya Sekuriti Malaysia.

Mengapa seseorang membeli cryptocurrency?

Sesetengah individu membeli cryptocurrency sebagai aset pelaburan kerana berharap nilainya meningkat. Namun begitu, harganya boleh berubah dengan sangat ketara dalam masa yang singkat. Oleh itu, cryptocurrency bukanlah simpanan yang sesuai untuk dana kecemasan atau wang yang diperlukan bagi perbelanjaan harian. Bank Negara Malaysia turut menekankan bahawa penilaian cryptoasset sangat tidak menentu.

Risiko cryptocurrency

Risiko	Penerangan mudah
Turun naik harga	Nilai boleh naik atau jatuh dengan mendadak
Penipuan	Terdapat platform palsu dan skim pelaburan tidak sah
Kehilangan akses	Pengguna mungkin kehilangan aset jika kata laluan atau akses dompet digital hilang
Kurang perlindungan	Pelaburan melalui entiti tidak berdaftar mungkin tidak dilindungi oleh undang-undang sekuriti Malaysia
FOMO	Pengguna membeli secara terburu-buru kerana takut terlepas peluang

Suruhanjaya Sekuriti Malaysia mengingatkan orang ramai supaya berhati-hati terhadap janji “tidak akan rugi”, pulangan terlalu tinggi dan tawaran yang mendesak pengguna melabur dengan segera.

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4. Perbezaan E-Pembayaran dan Cryptocurrency

Aspek	E-Pembayaran	Cryptocurrency
Tujuan utama	Membayar barangan dan perkhidmatan	Aset digital yang boleh diperdagangkan
Nilai	Berdasarkan Ringgit Malaysia	Berubah mengikut permintaan pasaran
Risiko harga	Rendah	Tinggi dan tidak menentu
Penggunaan harian	Lazim digunakan	Tidak diterima secara meluas sebagai bayaran
Status di Malaysia	Kaedah pembayaran elektronik	Bukan mata wang sah
Pengawal selia berkaitan	Institusi kewangan dan rangka kerja pembayaran	Suruhanjaya Sekuriti Malaysia bagi aktiviti perdagangan aset digital tertentu

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5. Panduan Sebelum Melabur dalam Cryptocurrency

Gunakan wang lebihan sahaja dan jangan menggunakan duit pinjaman, dana kecemasan atau wang untuk membayar komitmen bulanan. Fahami produk sebelum melabur dan jangan membuat keputusan hanya berdasarkan promosi media sosial atau saranan pempengaruh.

Semak terlebih dahulu sama ada platform atau entiti tersebut dibenarkan oleh Suruhanjaya Sekuriti Malaysia. Portal Investment Checker membolehkan pengguna menyemak sama ada individu atau entiti berkenaan berlesen atau berdaftar untuk menawarkan produk dan perkhidmatan pasaran modal di Malaysia.

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6. Kesimpulan

FINTECH memberi banyak manfaat jika digunakan secara bijak. E-pembayaran boleh membantu memudahkan urusan harian dan merekod perbelanjaan. Cryptocurrency pula perlu difahami sebagai aset digital berisiko tinggi, bukannya jalan mudah untuk memperoleh keuntungan segera.

Prinsip utama yang perlu diamalkan ialah:

Semak dahulu, fahami risikonya dan gunakan wang mengikut kemampuan.

Sambil2 tunggu kita menulis

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