Asset identification has always been a major headache for corporations, especially during audit-time, when the auditor would like to physically verify the presence of an asset. Usually in the older days, asset numbers were either stenciled on the asset or painted on it,large assets like plant equipment had bolt on steel plate type tags (“boiler plate tags”) on them, which contained details of when the asset was manufactured.

Since the assets typically had long lives, they almost outlived the life of the tag.This posed a problem as mis-identification, duplicate asset counting and asset “vanishing” took place. Asset identification and tracking therefore is a major issue, especially between a company’s management and its independent auditors. The management may be genuinely overwhelmed by the number, type and sheer numbers of the various assets under its control, but the auditors always look on these matters suspiciously, especially after earlier debacles like Enron, they can never be too sure.