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 FASB Accounting Standards Codification Manual, SEC Rules & Regulations (Title 17 — Commodity and Securities Exchanges), Trust Services Principles, Criteria, and Illustrations, Principles and Criteria for XBRL-Formatted Information, Audit and Accounting Guides & Audit Risk Alerts, Other Publications, Press Releases, and Reports, Dbriefs Financial Reporting Presentations, Business Combinations — SEC Reporting Considerations, Consolidation — Identifying a Controlling Financial Interest, Contingencies, Loss Recoveries, and Guarantees, Environmental Obligations and Asset Retirement Obligations, Equity Method Investments and Joint Ventures, Equity Method Investees — SEC Reporting Considerations, Foreign Currency Transactions and Translations, Guarantees and Collateralizations — SEC Reporting Considerations, Impairments and Disposals of Long-Lived Assets and Discontinued Operations, Multiple-Element Arrangements — A Roadmap to Applying the Revenue Recognition Guidance in ASU 2009-13, Qualitative Goodwill Impairment Assessment — A Roadmap to Applying the Guidance in ASU 2011-08, SEC Comment Letter Considerations, Including Industry Insights, Software Revenue Recognition — A Roadmap to Applying ASC 985-605, Transfers and Servicing of Financial Assets, Roadmaps Currently Available Only as a PDF. Absent reliable market data, a discounted cash flows model is otherwise used. Property, plant, and equipment are some of the most significant items in the statement of financial position and usually represent a substantial investment by the entity. and you may need to create a new Wiley Online Library account. They include … They are not for resale. The Property, plant, equipment and other assets guide discusses the accounting for acquisition transactions determined to be asset acquisitions under US GAAP. 24 ASC 340 Other Assets and Deferred Costs 389. Prior to the issuance of ASC 842, the accounting for these land easements was somewhat diverse. Situations that may result in subsequent changes to carrying amount include impairment, credit losses, fair value adjustments, depreciation and amortization, and so forth. 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). If no other U.S. GAAP applies, manufacturers should apply ASC 340-40, which requires the following: Cost includes (A) (A) all costs necessary to make the asset ready for … 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. Property, Plant and Equipment, ASC 360. accta February 10, 2018 U.S. GAAP by Topic. FRS 116, Property, Plant and Equipment (supersedes FRS 116 2004) Executive summary 15 3.1 Residual value 15 3.2 Elements of cost 16 3.3 Subsequent costs 16 3.4 Depreciation 16 3.5 Exchange of assets 16 3.6 Assets under construction 17 3.7 Revaluation model 17 3.8 Derecognition 17 3.9 Disclosures 17 3.10 Transitional provisions 17 criteria in Subtopic 36020, Property, Plant, and Equipment- —Real Estate Sales, in order to derecognize the in substance real estate. You must log in{"id":"id-cafb0aa4-2890-4663-a814-79a783feacc0","action":"login-q3j74v"} to view this content and have a subscription package that includes this content. Measured at cost 2. Post navigation. This chapter offers information on accounting and reporting on property, plant, and equipment, including accumulated depreciation. In particular, the relevant guidance is included in the “Impairment or Disposal of Long-Lived Asset” subsections of ASC 360 … Like all assets, intangible assets are those that are expected to generate economic returns for the company in the future. Property, plant, and equipment basically includes any of a company’s long-term, fixed assets. The FASB also is making a technical correction in Topic 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. Clarified scope of ASC 610-20 General Items of property, plant, and equipment are used in the ordinary course of business. IAS 16 outlines the accounting treatment for most types of property, plant and equipment. Use the link below to share a full-text version of this article with your friends and colleagues. Paragraph 606-10-25-30 on when an entity satisfies a performance obligation by transferring control of an asset. Property, Plant and Equipment, ASC 360. accta December 15, 2015 November 30, 2018 U.S. GAAP by Topic. B. Next. Measured at cost 2. The guide also discusses the capitalization of costs, such as construction and development costs and software costs, as well as the subsequent accounting for PP&E, including impairments, depreciation and amortization, and asset … The real estate sales guidance was placed under the Property, Plant, and Equipment Topic because it is applicable to all entities involved with real estate sales transactions. Wiley GAAP 2020: Interpretation and Application of Generally Accepted Accounting Principles. ASC Topic 360, “Property, Plant, and Equipment,” requires entities to evaluate property, plant, and equipment and amortizable finite-lived intangibles, referred to collectively as long-lived assets, for recoverability “whenever events or changes in circumstances indicate that its carrying amount may not be recoverable.” ASC 360 comprises two Subtopics (Overall and Real Estate Sales). ASC 360-10 provides guidance on accounting for property, plant, and equipment, and the related accumulated depreciation on those assets. 942 Financial Services—Depository and Lending, 960 Plan Accounting—Defined Benefit Pension Plans, 962 Plan Accounting—Defined Contribution Pension Plans, 965 Plan Accounting—Health and Welfare Benefit Plans, 972 Real Estate—Common Interest Realty Associations. During the construction period Property, plant, and equipment (sometimes referred to as “fixed assets,” “tangible long lived assets,” or “plant assets”) are tangible property used in a productive capacity that will benefit the reporting entity for a period exceeding one year. They include land, buildings, machinery, furniture, and tools. FASB ASC 350, Intangibles - Goodwill and Other - This topic provides guidance on financial accounting and reporting related to goodwill and other intangibles, other than the accounting at acquisition for goodwill and other intangibles. However, differing views exist in practice on whether parent of an the in substance real estate subsidiary must satisfy the criteria in Subtopic 360-20, Property, Plant, and Equipment—Real Estate Sales, in order to derecognize the real estate. Property, plant, and equipment (sometimes referred to as “fixed assets,” “tangible long lived assets,” or “plant assets”) are tangible property used in a productive capacity that will benefit the reporting entity for a period exceeding one year. Copyright © 2020 Deloitte Development LLC. U.S. GAAP on property, plant, and equipment and the impairment or disposal of long-lived assets in ASC 3601 requires entities to test a long-lived asset or group of assets for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable (see ASC 360 … Entities accounted for them by applying ASC Topic 840, Leases, Topic 350, Intangibles-Goodwill and Other, or Topic 360, Property, Plant and Equipment. The objective of this Update is to resolve the diversity in practice about whether the guidance in Subtopic 360es to a parent that ceases to have a -20 appli ASC 360-10 provides guidance on accounting and reporting on property, plant, and equipment, including accumulated depreciation. ASC 360-10 notes that long-lived tangible assets include land and land improvements, buildings, machinery and equipment, and furniture and fixtures. Cost includes (A) (A) all costs necessary to make the asset ready for intended use 3. Cost includes (A) (A) all costs necessary to make the asset ready for intended use 3. 1. This Subtopic provides accounting guidance for the sale of real estate other than retail land. 3. Measured at cost 2. ASC 360-10 provides guidance on accounting for property, plant, and equipment, and the related accumulated depreciation on those assets. ASC 360-10 provides guidance on accounting and reporting on property, plant, and equipment, including accumulated depreciation. Previous. The Real Estate Topics are found at ASC 970 through ASC 978. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. 20 ASC 323 Investments—Equity Method and Joint Ventures 285. derecognition guidance in ASC 360-20, Property, Plant, and Equipment: Real Estate Sales, as well as those that contribute nonfinancial assets that are neither a business nor a nonprofit activity to a joint venture or other noncontrolled investee. Property, plant, and equipment are tangible property used in a productive capacity that will benefit the reporting entity for a period exceeding one year. Leases of assets under construction (covered by ASC 360, Property, Plant and Equipment) Consequential amendments address interaction with other guidance. ASC 360‐10 provides guidance on accounting and reporting on property, plant, and equipment, including accumulated depreciation. Next. They include land, buildings, machinery, furniture, and tools. 26 ASC 360 Property, Plant, and Equipment 437. 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 … Initial measurement of property, plant and equipment. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. This Subtopic also includes guidance on the impairment or disposal of long-lived assets. Post navigation. Welcome to the Deloitte Accounting Research Tool (DART)! This Subtopic also includes guidance on the impairment or disposal of long-lived assets. ASC 275 – Presentation, Risks and Uncertainties ASC 730-10 – Expenses, Research and Development ASC 235 – Presentation, Notes to the Financial Statements ASC 360-10 – Property, Plant and Equipment. 27 ASC 405 Liabilities 481 As a long-term asset, this expectation extends beyond one year., identifiable, and expected to generate an economic return for th… Learn about our remote access options. Determination of costs is critical to proper accounting for property, plant, and equipment. The Business evaluates the recoverability of its long-lived assets in accordance with the provisions of ASC 360, Property, Plant and Equipment (ASC 360). Enter your email address below and we will send you your username, If the address matches an existing account you will receive an email with instructions to retrieve your username, I have read and accept the Wiley Online Library Terms and Conditions of Use, https://doi.org/10.1002/9781119652663.ch26. For more information about our organization, please visit ey.com. This area is now governed by FASB ASC 360, Property Plant and Equipment. 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. ASC 360 prescribes a three-step trigger-based process for long-lived assets. 21 ASC 325 Investments—Other 323. All rights reserved. Below is an overview of each Subtopic. 25 ASC 350 Intangibles—Goodwill and Other 405. 23 ASC 330 Inventory 349. This includes interest costs incurred during the period of time necessary to ready the asset for use. Entities use historical cost to value property, plant, and equipment. Before applying ASC 340-40, manufacturers should first evaluate whether costs are within the scope of existing U.S. GAAP, such as ASC 330, Inventory, ASC 360, Property, Plant, and Equipment, or ASC 350-40, Internal Use Software. These disclosures should be made as if the capitalized Refer to ASC 360 and IAS 16 and 40 for all of the specific requirements applicable to Generally, the property’s current market value is the best evidence of fair value. 22 ASC 326 Financial Instruments—Credit Losses 331. Working off-campus? Initial measurement of property, plant and equipment. The full text of this article hosted at iucr.org is unavailable due to technical difficulties. 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. PP&E assets are tangibleIntangible AssetsAccording to the IFRS, intangible assets are identifiable, non-monetary assets without physical substance. Updates to ASC 853, Service Concession Arrangements, clarify the right to use the infrastructure in a service concession arrangement is not in ASC 842’s scope. 1. This Topic comprises two Subtopics (Overall and Real Estate Sales). Previous. Other guidance specific to the real estate subindustries is found in the related Real Estate Topics. Please check your email for instructions on resetting your password. If you do not receive an email within 10 minutes, your email address may not be registered, ASC 360 calls for a recoverability test to be performed in order to determine if an impairment loss exists, in which case the fair value of an asset or asset group must be determined. Upon acquisition, the reporting entity should measure and capitalize all the historical costs necessary to deliver the asset to its intended location and prepare it for its productive use. 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. Learn more. 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