Agreement of the fixed asset register NBV to the NBV in financial statements enables what?

• A. The fixed asset register to be used as the NBV figure in the financial statements
• B. The fixed asset register to prove the existence of all assets
• C. The fixed asset register to determine depreciation method
• D. The fixed asset register to replace cash confirmations

Answer: (A)

Agreeing the net book value between the fixed asset register and the financial statements confirms that the asset records are valued correctly and aligned with what is shown in the financial statements. The net book value is the asset’s cost minus accumulated depreciation, so when the register’s NBV matches the NBV in the FS, it indicates depreciation has been calculated and applied consistently, and additions or disposals have been recorded properly. This consistency means the fixed asset register can be used as the source for the NBV figure in the financial statements, supporting the reliability of the stated asset values. Note that confirming existence, choosing depreciation methods, or replacing cash confirmations require separate procedures.