The IAS 16 refers to Property, Plant, and Equipment. This accounting standard clearly explains all the pros and cons related to fixed assets. The major strengths of IAS 16 are;
It determines the price of fixed assets and also inherits the depreciation value which shows the actual market value of the asset in context with the lifetime.
Another positive impact of IAS 16 is the revaluation model under which price of the fixed asset is determined every year with the passage of time to be able to know the exact worth of the fixed asset. It shows the amortization method of fixed assets in case of increase in value
It carries the inability to treat the cost of the new facility or producing a new product as being capitalized.
The IAS 16 is not feasible for producing bearer plants plus it also does not apply to develop or maintain the last three categories of assets