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1475818
Property, Plant & Equipment
Description
Mind Map on Property, Plant & Equipment, created by Thiffany Martin on 16/10/2014.
Mind Map by
Thiffany Martin
, updated more than 1 year ago
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Created by
Thiffany Martin
almost 10 years ago
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Resource summary
Property, Plant & Equipment
Definition
tangible items that are
held for use - production / supply of goods & services, rental to others / administrative purposes
Mode of usage
expected to be used during more than one period
term of holding by an entity
Applicable Std & Scope
IAS 16
except
another accounting std requires diff. accounting treatment
doesn't apply to some items of PPe within the scope of other accounting stds
Assets held for sale (IFRS 5)
Biological assets (IAS 41)
Exploration & evaluation assets (IFRS 6)
Recognition
Cost = Asset, only if
probable - future economic benefits - flow to the entity
cost of the item - measured reliably
After PPE has been recognised as asset - may incur additional cost on the PPE
maintenance costs
give rise to future economic benefits
Day-to-day servicing (repair & maintenance) = expenses
major spare parts, servicing equipments, replacement & inspection of PPE = asset (if recognition criteria is met)
Measurement
At recognition
cost
Purchase price
Directly attributable Cost
Dismantling Cost
carrying amount of an item - ceases when
yet to be brought into use / just launched / operated less than full capacity
Initial operating losses
costs of relocating part / all of an entity's operations
acquired in exchange
fair value
except
lack of commercial substances
fair value is not reliably measured
After recognition
Cost Model
Revaluation Model
Surplus
Deficit
Depreciation
systematic allocation - depreciable amount - an asset over its useful life
shall be recognised in the P&L unless included in the carrying amt of another asset
calculate
commencement / cessation of depn.
depreciable amt. (incl. residual value) of asset
useful life of asset
depn. method
Derecognition
on disposal
IAS 18
sales of goods
IAS 17
sale & leaseback
no future economic benefit - expected - its use / disposal
gain / loss - P&L
gain ≠ revenue
Disclosure
measurement bases used for determining - gross carrying amt.
depn. methods used
useful lives / depn. rates used
gross carrying amt. & acc. depn. (plus acc. impairment losses) - beginning & end of the period
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