Property, Plant and Equipment (IAS 16/AASB 116)

Corporate Reporting Insights

BDO's monthly newsletter, Corporate Reporting Insights, keeps you up to date with the latest Australian and global developments in corporate financial and sustainability reporting.

• Proceeds from selling items before property, plant and equipment is ready for intended use – Deduct off cost or recognise as income? (November 2022)
• More common errors when accounting for property, plant and equipment (IAS 16 - Part 4) (July 2018)
• More common error when accounting for property, plant and equipment (IAS 16 - Part 3) (May 2018)
• Blind Freddy – More common errors when accounting for property, plant and equipment (IAS 16 – Part 2) (April 2018)
• Blind Freddy – Common errors when accounting for property, plant and equipment (IAS 16) (March 2018)
• Proposed changes to accounting for property, plant and equipment - proceeds from selling test items (July 2017)
• Investment property - Easier to transfer in and out? (March 2017)
• Land​ and buildings – Which level in the fair value hierarchy?​ (August 2014)
• IASB approves amendments to accounting for bearer plants AASB 2014-1 (July 2014)
• IASB clarifies acceptable methods of depreciation and amortisation (May 2014)
• Ten ways to materially misstate your financial statements…The ‘Blind Freddy’ proposition continued - Part 7 - Capitalising items that fail the definition of an asset (May 2012)
• IASB issues interpretation on stripping costs (October 2011)
• Accounting for insurance proceeds for natural disaster relief (August 2011).

BDO Global IFRS Resources

The following publications have been produced by the BDO Global IFRS group:

► IFRS at a Glance

A high level overview of International Financial Reporting Standards (IFRSs), including International Accounting Standards and Interpretations.

• IAS 16 Property, Plant and Equipment
• IFRIC 1 Changes in Existing Decommissioning, Restoration and Similar Liabilities
• IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine.

► IFR Bulletins

Focus on latest developments in international financial reporting.

• Effects of climate-related matters on financial statements (IFRB 2020 14).

IFRIC agenda decisions

IFRS Interpretations Committee (the Committee) agenda decisions are those issues that the Committee decided not to take onto its agenda. Although not authoritative guidance, in practice they are regarded as being highly persuasive, and all entities reporting under IFRS should be aware of these decisions because they could impact the way particular transactions and balances are accounted for. Agenda decisions on this topic include:

• Lease term and useful life of leasehold improvements (November 2019) and eLearning (November 2019) and FAQ
• Variable payments for asset purchases (March 2016) and FAQ
• Core inventories (November 2014) and FAQ
• Disclosure of carrying amounts under the cost model (May 2014) and FAQ
• Sales proceeds from testing an asset (July 2011) and FAQ
• Disclosure of idle assets and construction in progress (May 2009) and FAQ.

Online training resources

Improve your knowledge of accounting standards by purchasing our online training resources on a variety of financial reporting topics. Resources available on this topic include:

• A seminar – a pre-recorded two-hour webinar that provides a high-level overview of the accounting standard, as well as a question and answer case study booklet
• eLearning – a self-paced interactive web-based eLearning module that provides an in-depth understanding of the key aspects of the accounting standard and requires participants to read and answer questions relating to the content.