资源描述：
《Ch7_PPE_Intangibles_IFRS》由会员上传分享，免费在线阅读，更多相关内容在教育资源-天天文库。
1、Property,Plant&Equipment:whatarethedifferencesbetweenIFRSandUSGAAP?•Asset Impairment and Revaluation Asset Impairment and RevaluationHowareIFRSandUSGAAPdifferent?Generally speaking, US GAAP requires most assets to be valued at their historical cost, as dictated by the C
2、ost Principle. Under IFRS, companies can choose to value their assets at cost or fair market values. Some companies using IFRS adopt the fair market value approach. Companies who use the fair market approach must use it consistently. They are not allowed to switch back
3、and forth between valuation methods. US GAAP allows long‐term assets that are permanently impaired to be written downin value. These writedowns cannot be reversed. Under IFRS, if fair market valuation is used instead of historical cost, long‐term assets can be written u
4、pordown, depending upon their appraised fair market values. These writeups and writedowns can be reversed, if it can be demonstrated that the asset’s value has changed again. None of these adjustments are considered to be permanent. The gains and losses on these writeup
5、s and writedowns are usually reported as reserves, and listed under equity, rather than appearing on the income statement. If there are no positive reserves present, writedowns will still result in losses on the income statement. Howwoulditchangethefinancialstatements?I
6、f companies use fair market valuation for their long‐term assets, they will have to periodically reassess these market values, and this could result in adjustments to these assets’ valuations. These adjustments will result in reserves reported under equity, which would
7、impact the balance sheet (or more rarely, losses reported on the income statement) which would impact net income. Whatcoulditmeanforbusinesses?Companies will have much more leeway in presenting their assets values on their balance sheets. These amounts will be a better
8、 reflection of current value, and may therefore be more relevant for financial statement readers. However the
