Transfer and Useful life: Difference between pages

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imported>Doug Williamson
(Add third definition. Source: linked pages.)
 
(Add quote from IAS 16 - https://www.ifrs.org/content/dam/ifrs/publications/pdf-standards/english/2022/issued/part-a/ias-16-property-plant-and-equipment.pdf?bypass=on)
 
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1. ''Cash and securities management.''  
''Accounting''.
The length of time an asset is in use.


The sending (or movement) of funds or securities or of a right relating to funds or securities from one party to another by:
The asset should be depreciated over its useful life.


i. The conveyance of physical instruments/money; or


ii. Accounting entries on the books of a financial intermediary; or
:<span style="color:#4B0082">'''''Estimation of useful life for IAS 16 financial reporting is a matter of judgement'''''</span>


iii. Accounting entries processed through a funds and/or securities transfer system.
:"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.


The act of transfer affects the legal rights of the transferor, transferee and possibly third parties in relation to the money balance, security or other financial instrument being transferred.
: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."


2. ''Risk management.''  
:''IAS 16 - Property, plant and equipment - paragraph 57.''


In relation to risk management, a response to risk in which another party is paid - or otherwise induced - to accept the risk.
Such a transfer often leaves counterparty risk on that other party as the primary residual risk.
The 'transfer' risk response includes both insurance and external hedging of financial risks with derivative instruments such as forward contracts.


== 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]]


3. ''Pensions.''


The movement of a pension scheme member from one scheme to another, together with related pension liabilities and assets.
==Other resource==
*[https://www.ifrs.org/content/dam/ifrs/publications/pdf-standards/english/2022/issued/part-a/ias-16-property-plant-and-equipment.pdf?bypass=on IAS 16 text]]


[[Category:Accounting,_tax_and_regulation]]


== See also ==
[[Category:Accounting,_tax_and_regulation]]
* [[Counterparty risk]]
* [[Derivative instrument]]
* [[Final transfer]]
* [[Fixing]]
* [[Forward contract]]
* [[Hedging]]
* [[Insurance]]
* [[Payments and payment systems]]
* [[Provisional transfer]]
* [[Reduce]]
* [[Repetitive transfers]]
* [[Risk response]]
* [[Transfer system]]
* [[Transfer value]]
* [[TUPE]]

Revision as of 21:12, 29 October 2023

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


Other resource

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