Useful life
From ACT Wiki
Accounting.
The length of time an asset is in use.
The asset should be depreciated over its useful life.
- Estimation of useful life for IAS 16 financial reporting is a matter of judgement
- "The useful life of an asset is defined in terms of the asset’s expected utility to the entity.
- The asset management policy of the entity may involve the disposal of assets after a specified time or after consumption of a specified proportion of the future economic benefits embodied in the asset.
- Therefore, the useful life of an asset may be shorter than its economic life.
- The estimation of the useful life of the asset is a matter of judgement based on the experience of the entity with similar assets."
- IAS 16 - Property, plant and equipment - paragraph 57.
See also
- Accounting
- Asset management
- Depreciating asset
- Depreciation
- Economic life
- Financial reporting
- IAS 16
- Judgement
- Life
- Property, plant and equipment
- Reporting entity
- Short life asset
- Useful economic life
- Utility