Final answer:
The statement is false because a fixed asset disposal report does not authorize the disposal of an asset; rather, it records the details of the disposal process. Authorization typically comes from management or a designated committee following the organization's internal policies.
Step-by-step explanation:
The statement that a fixed asset disposal report authorizes the user department to dispose of a fixed asset is false. Generally, the fixed asset disposal report is used to record the details of the disposal of a fixed asset, including the date of disposal, method of disposal, reason for disposal, and the financial implications such as any gain or loss on the disposal. However, this report in itself does not serve as an authorization for disposal. The authorization to dispose of a fixed asset typically comes from higher levels of management or a designated committee within an organization, depending on the company's internal policies and the value of the asset being disposed of.
The fixed asset disposal report plays a crucial role in accounting for the asset within the financial statements and for maintaining accurate records of an organization's assets. Proper authorization and documentation are essential in managing an entity’s assets and ensuring compliance with relevant accounting standards and regulations.