IAS 16: PPE Cheat Sheet

I couldn't connect spend with business value until I understood this accounting principle.

Fixed assets shouldn’t feel like hard work to understand.

IAS 16 – Property, Plant and Equipment is one of the core standards in financial reporting.

It sets out how companies should account for long-term tangible assets. It covers from initial recognition and capital expenditure to depreciation and disposals.

Accounting students, early career professionals, and even entrepreneurs should aim to understand these concepts as early as possible to ensure they are valuing correctly and setting their financial statements up for success.

✅ What counts as PPE and when it’s recognised 

✅ How subsequent expenditure is treated 

✅ Straight-line vs. reducing balance depreciation 

✅ Disclosure requirements under IAS 16 

✅ Accounting entries for disposals, including assets previously revalued

Capitalisation isn't just a requirement, it is a strategy which can have significant impacts on profit.

📥 Download the free PDF from the link in my bio.

💼 Created with early-career accountants and finance professionals in mind.