What are the key audit procedures for verifying assets acquired on hire purchase, including their treatment under NAS 17, initial recognition, depreciation, and presentation in the Statement of Financial Position?

For assets acquired on hire purchase, the following steps are essential: Inspect the hire purchase agreement to understand the terms, installment details, and interest. Treat these assets as acquired under a finance lease per NAS 17 - Lease. Ensure the initial recognition of the lease is recorded as an asset and a corresponding liability at equal amounts. Verify depreciation practices: If ownership is likely at the end of the term, depreciate over the asset's useful life. If not, depreciate over the shorter of the useful life and the lease term. Ensure the asset is shown separately in the Statement of Financial Position.