Amortisation: Difference between revisions
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imported>Doug Williamson (Add example.) |
imported>Doug Williamson (Define tangible.) |
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#In financial accounting, the writing down of the value of an intangible fixed asset - such as a licence - over time. Similar to the depreciation of tangible fixed assets. | #In financial accounting, the writing down of the value of an intangible fixed asset - such as a licence - over time. Similar to the depreciation of tangible (physical) fixed assets. | ||
#More generally, the spreading of any amount or difference over time. | #More generally, the spreading of any amount or difference over time. | ||
#The spreading of a pension scheme surplus or deficit over a period of time, often for the purposes of granting a Contributions holiday (in the case of a surplus) or calculating deficit reduction contributions (in the case of a deficit). | #The spreading of a pension scheme surplus or deficit over a period of time, often for the purposes of granting a Contributions holiday (in the case of a surplus) or calculating deficit reduction contributions (in the case of a deficit). | ||
Revision as of 07:54, 7 November 2015
- In financial accounting, the writing down of the value of an intangible fixed asset - such as a licence - over time. Similar to the depreciation of tangible (physical) fixed assets.
- More generally, the spreading of any amount or difference over time.
- The spreading of a pension scheme surplus or deficit over a period of time, often for the purposes of granting a Contributions holiday (in the case of a surplus) or calculating deficit reduction contributions (in the case of a deficit).
- The repayment or reduction of the principal amount of an obligation over time. For example the repayment of loan principal by instalments.
- In financial accounting, where there is a difference between the initial amount and the maturity amount of a financial asset or a financial liability, the spreading of that difference over time. The spreading calculation is commonly made using the Effective interest method.
