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how to explain the objective of providing information on property,plant and equipment with a complete example.
in IAS 16 - Property, Plant and Equipment by

1 Answer

0 votes
The objective of this Standard is to prescribe the accounting treatment for property, plant and equipment so
that users of the financial statements can discern information about an entity’s investment in its property,
plant and equipment and the changes in such investment. The principal issues in accounting for property,
plant and equipment are the recognition of the assets, the determination of their carrying amounts and the
depreciation charges and impairment losses to be recognised in relation to them.
by Level 5 Member (11.3k points)
The system is designed for your benefit. Property & plant is not expensed out in current year, your claim of expenditure in accounting and tax as depreciation over its useful life requires to keep the record in tact. When you destroy the record, you cannot value your market of property as net worth of business. You cannot revalue your property. The accounting of historical cost of property and revaluation of it cannot be shown as on-going property management in the absence of record. The safeguarding of assets may not be possible in absence of record of property, which are also counted as conditioned property in hand.