Once you’ve determined there’s an indication of impairment, ASC 360 Property, Plant, and Equipment (ASC 360) specifies these steps to be completed in the calculation of an impairment: If impairment indicators are identified, test the recoverability of the asset by comparing the cash flows expected to be generated over the asset’s life against its current carrying value. Study on the go. They include land, buildings, machinery, furniture, and tools. View more. Issued in August 2001, Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 360, Property, Plant, and Equipment (“ASC 360”) addresses financial accounting and reporting for the impairment of long-lived assets and for long-lived assets to be disposed of. FASB ASC 360 Property, Plant and Equipment. Written comments should be addressed to: Technical Director File Reference No. Therefore, we are fairly certain that the spare parts should be treated as inventory. Home computers. Property, Plant and Equipment is to be regarded as the surrogate carrying amount of “prepaid lease payments”. the criteria to be reported as a discontinued operation is within the scope of ASC 360-10, Property, Plant, and Equipment — Overall. This Exposure Draft of a proposed Accounting Standards Update of Topic 360 is issued by the Board for public comment. Property, plant, and equipment are physical or tangible assets that are long-term assets that typically have a life of more than one year. View FASB ASC 360 Property, Plant and Equipment from ACCT 60010 at Texas Christian University. Investments in equity securities and available-for-sale securities under ASC 321-10 and ASC 326-10, respectively. Property, Plant, and Equipment (Topic 360) Derecognition of in Substance Real Estate— a Scope Clarification . I think the basics are pretty straight forward: capitalize costs incurred to get the asset placed in service, then depreciate over its useful life using a reasonable method such as straight line, MACRS (DDB), etc. [1] IAS 16 outlines the accounting treatment for most types of property, plant and equipment. 71 pages. This area is now governed by FASB ASC 360, Property Plant and Equipment. 6 pages. The guidance in ASC 360 addresses the accounting for long-lived nonfinancial assets, differentiating between assets that are “held and used,” assets that are “held for sale,” and assets that an entity has decided to abandon. Accounting Standards Update Financial Accounting Standards Board of the Financial Accounting Foundation 401 MERRITT 7, PO BOX 5116, NORWALK, CONNECTICUT 06856 -5116 . Other Related Materials. Codification Topic 360 Property, Plant, and Equipment : Subtopics of Codification Topic 360 360-10 Overall 360-20 Real estate sales : Accounting Terms of Codification Topic 360-10 Activities Asset group Component of an equity Disposal group Firm purchase commitment Impairment Integral equipment Operating segment Probable Reporting unit The FASB Accounting Standards Codification simplifies user access to all authoritative U.S. generally accepted accounting principles (GAAP) by providing all the authoritative literature related to a particular Topic in one place. Home computers; Florida State University; ACG 5515 - Spring 2013. ASC 360 prescribes a three-step trigger-based process for long-lived assets. 10 Overall 220 Income Statement—Reporting Comprehensive Income 225 Income Statement 235 Notes to Financial Statements 270 Interim Reporting 280 Segment Reporting 323 Investments—Equity Method and Joint Ventures 330 Inventory 350 Intangibles—Goodwill and Other 360 Property, Plant, and Equipment 470 Debt 605 Revenue Recognition 720 Other Expenses 740 Income Taxes 810 … The term authoritative includes all level AD GAAP that has been issued by a standard setter. Property, plant and equipment is initially measured at its cost, subsequently measured either using a cost or revaluation model, and depreciated so that its depreciable amount is allocated on a systematic basis over its useful life. Derecognition of in Substance Real Estate— Scope Clarification. Proposed Accounting Standards Update—Property, Plant, and Equipment (Topic 360): Derecognition of in Substance Real Estate—a Scope Clarification (a consensus of the FASB Emerging Issues Task Force) By clicking on the ACCEPT button, you confirm that you have read and understand the FASB Website Terms and Conditions. 360, Property, Plant, and Equipment, to clarify that the accounting and disclosure guidance for collections in Subtopic 958-360, Not-for-Profit Entities—Property, Plant, and Equipment, applies to business entit ies as well as not-for-profit entities, consistent with what was indicated in Statement 116. Who Is Affected by the Amendments in This Update? FASB Accounting Standards Codification (ASC) Topic 360, “Property, Plant, and Equipment,” provides guidance for the impairment of long-lived assets that are classified as held and used. … Refer to our FRD, Impairment or disposal of long-lived assets, for further details. Do you accept the terms? All direct costs of constructing an entity's own tangible fixed assets are capitalized. Examples of property, plant, and equipment … Impairment testing is required whether in the case of a “triggering event”, as defined in ASC 350 – Intangibles – Goodwill and Other, and in ASC 360 – Plant, Property and Equipment. a consensus of the FASB Emerging Issues Task Force. property, plant and equipment and investment property, except for differences related to impairment accounting (which are covered in another of our comparisons, U.S. GAAP vs. IFRS: Impairment of long-lived assets). Indefinite-lived intangibles under ASC 350-30. IN this video, I discuss property plant and equipment also known as PPE. Triggering event-based impairment testing is an issue even for those who have made accounting elections whereby assets are being amortized rather than tested annually for impairment. within the scope of ASC 360, Property, Plant and Equipment, for purposes of evaluating whether the asset’s carrying amount is impaired. ASC 210-10-45 provides guidance on the balance sheet presentation. ASC 360-10 provides guidance on accounting and reporting on property, plant, and equipment, including accumulated depreciation. FRS 124, Related Party Disclosures: zThe scope restriction to public listed companies and their subsidiaries has been removed and FRS 124 now applies to all entities (except exempt entities - see SOP 1), including state controlled enterprises. Download the iOS; Download the Android app. ASC 360‐10 provides guidance on accounting and reporting on property, plant, and equipment, including accumulated depreciation. Accounting Standards Codification (ASC 360), Property, Plant and Equipment (“PP&E”) provides guidance with respect to impairment testing for a company’s long-lived assets such as property, plant, equipment and intangibles. 2014-08 April 2014 Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity An Amendment of the FASB Accounting Standards Codification ® The FASB Accounting Standards Codification® is the source of authoritative generally accepted accounting principles (GAAP) recognized by the FASB to be applied … December 2011 . 28ASC 360 Property, Plant, and Equipment Perspective and Issues Subtopics Scope and Scope Exceptions ASC 360-10, General ASC 360-10, Impairment of Disposal of Long-Lived Assets ASC 360-20 Overview ASC … - Selection from Wiley GAAP 2018, 16th Edition [Book] The recorded amount of an asset includes all of the costs necessary to get the asset set up and functioning properly for its intended use, including interest. Property, Plant, and Equipment (Topic 360) a ® An Amendment of the FASB Accounting Standards Codification No. Property, plant, and equipment are tangible property used in a productive capacity that will benefit the reporting entity for a period exceeding one year. EITF-100E Proposed … 2011-10 . The test for impairment under ASC 360 consists of the following steps: Financial Accounting Standards Board Page 1 of 71 October 03, 2013 360 Property, Plant, and Roger Philipp, CPA, CGMA, explains Plant, Property, and Equipment as Fixed Assets in this video. spare parts to be used within one year, ASC 360 “Property, Plant, and Equipment” is irrelevant since it deals with long-lived assets with a useful life of more than one year. Equity method investments under ASC 323-10 . 360 20 55 69 Pending Content Transition Date P June 15 2012 N December 15 2013; Texas Christian University ; ACCT 60010 - Spring 2014. Refer to ASC 360 and IAS 16 and 40 for all of the specific requirements applicable to ASC 360-10 provides guidance on accounting and reporting on property, plant, and equipment, including accumulated depreciation. and Property, Plant, and Equipment (Topic 360) No. In particular, the relevant guidance is included in the “Impairment or Disposal of Long-Lived Asset” subsections of ASC 360-10. 2) Long-lived assets, such as property, plant and equipment (PP&E), finite-lived intangible assets and asset groups under ASC 360-10. ASC 360‐20, Real Estate Sales , which provides guidance on the sale of real estate other than retail land. ASC 360-10 provides guidance on accounting and reporting on property, plant, and equipment, including accumulated depreciation.