Intermediate Audit Staff Training: Auditing Property, Plant & Equipment

Author: Robert K Minniti

This intermediate level course equips audit professionals with a comprehensive, risk based approach to auditing property, plant, and equipment (PP&E)—a high value financial statement category subject to complex accounting requirements and heightened audit risk. Participants will learn how to assess inherent and control risks, evaluate capitalization policies, test depreciation and useful lives, and identify impairment indicators in accordance with U.S. GAAP and PCAOB auditing standards.

Through real world examples and practical audit scenarios, the program explores PP&E additions, retirements, repairs and maintenance, construction in progress, valuation considerations, and fraud risks such as improper capitalization, unrecorded disposals, and manipulated useful lives. Attendees will gain actionable strategies for designing and performing substantive procedures, enhancing documentation quality, and applying professional skepticism in PP&E audits.

By the end of this course, participants will be equipped to conduct effective, well documented PP&E audits that strengthen audit quality and ensure accurate financial reporting.

Publication Date: May 2026

Designed For
This course is ideal for audit professionals responsible for evaluating significant long‑term asset accounts and related financial reporting risks

Topics Covered

• PP&E lifecycle: acquisition, construction, depreciation, repairs, and disposal
• Capitalization policies and testing for proper classification of costs
• Internal controls over fixed asset processes including authorization, tracking, and safeguarding
• Substantive testing: additions, retirements, depreciation, and impairment
• Analyzing repairs vs. capital improvements
• Impairment indicators and valuation considerations
• Fraud risks including improper capitalization and unrecorded disposals
• Documentation expectations and common PP&E audit pitfalls

Learning Objectives

• Identify common types of PP&E and apply U.S. GAAP recognition, measurement, and disclosure requirements
• Identify risks of material misstatement related to capitalization, valuation, impairment, and disposals
• Evaluate internal controls over acquisitions, disposals, repairs, depreciation processes, and asset management
• Design and perform substantive procedures including price testing, existence testing, depreciation recalculation, and impairment analysis
• Recognize fraud risks and red flags such as improperly capitalized expenses or unrecorded retirements
• Identify PP&E procedures, evidence, and conclusions in accordance with auditing standards

Level
Intermediate

Instructional Method
Self-Study

NASBA Field of Study
Auditing (2 hours)

Program Prerequisites
Basic understanding of auditing

Advance Preparation
None