A Fixed Asset Clearing Account (FACA) is a financial term used to describe the process of reconciling the fixed asset ledger with the general ledger. It is important to accurately track and maintain each ledger when using FACA, as this allows for accurate bookkeeping, month-end closing, and taxes returns. FACA works by temporarily transferring the accounting entries of a fixed asset into a “clearing account” which is then cleared at the period end. This process helps ensure that all transactions are recorded properly while avoiding potential discrepancies between two different ledgers. FACA is an essential component of any business’s overall financial strategy, and should be mastered in order to ensure accuracy and compliance.