XBert Type: Standard
Accounting Software: Xero
Country Restriction: All supported countries
Risk Type: Financial Reporting Risk
Business Function: Fixed Assets
Overview
The "Unmapped Fixed Asset Account with Balance" XBert checks your balance sheet for fixed asset accounts that hold a balance but are not linked to your fixed asset register. When an asset account sits outside the register, those assets may not depreciate correctly and your reports can quietly drift away from reality.
What it does
This XBert looks at every active account on your chart of accounts that is set up as a fixed asset account, and compares each one against your fixed asset register. For each account, it checks whether the account is linked to the register in any of these roles:
The asset account for a fixed asset type (for example buildings, vehicles or equipment)
A depreciation expense account
An accumulated depreciation account
It then checks the current balance of each unlinked account to see whether it is holding any money.
How it works
The XBert raises an alert when a fixed asset account has a balance that is not zero and is not linked to your fixed asset register in any of those roles. In plain terms: there is money sitting in a fixed asset account, but nothing in your register is set up to track or depreciate it.
To keep the check relevant, it only runs when your file is actually using the fixed asset register. It will not run unless you have at least one fixed asset type set up and you have recorded at least one fixed asset purchased in the past two years. Accounts that are inactive, and accounts with a zero balance, are ignored.
Example/Use Case
Brad was entering a bill for a new $4,200 laptop. He accidentally coded the purchase to a general "Office Equipment" asset account that had never been linked to the fixed asset register, instead of the registered "Computer Equipment" asset type. The laptop's value sat on the balance sheet, but no depreciation was ever calculated against it, so the asset was slowly being overstated. XBert flagged the unmapped account holding the $4,200 balance. Brad linked that account to the correct asset type so depreciation could begin and his reports stayed accurate.
Accounting software
Xero only. This XBert relies on the Xero fixed asset register.
Which countries it supports
All supported countries that use the Xero fixed asset register.
Processes
This XBert falls under the Fixed Assets business function. To resolve it:
Open the flagged fixed asset account and review its balance and the transactions that make it up.
Decide whether this account should be tracked in your fixed asset register. If it should, link it to the correct fixed asset type as the asset, depreciation expense or accumulated depreciation account.
If the balance was coded to the wrong account, move the transactions to the correct, registered fixed asset account.
If the account is not meant to hold fixed assets, move the balance to the appropriate account so the fixed asset account no longer carries it.
Check that depreciation is now being calculated correctly for any assets in the account.
Once the account is correctly mapped or the balance is reallocated, mark the XBert as resolved.