The Importance of Establishing Financial Valuation of Fixed Assets in Public Companies whose Founders Are Local Self-Government Units in the Republic of Serbia
Keywords:Financial valuation, Fixed assets, Public companies
Valuing company's fixed assets is one of the important tasks that top management needs to do in order to be able to make valid management decisions. This paper used data obtained from a representative survey of 170 public companies whose founders are local self-government units, which is about 25% of such companies in the Republic of Serbia. Unlike the other studies, the authors analyzed fixed assets of a company before and after valuation of total fixed assets. Internal audits’ recommendations and top management’s assessments regarding the valuation of total fixed assets of a company were the reason why this valuation was done. It was concluded that there is a high correlation (p = .00) between the obtained total assessment given by internal auditors and top management regarding the valuation of fixed assets before and after the valuation of total fixed assets of the company.