Financial reporting - accounting practices - longer term tangible assets.
The accounting values of most tangible fixed assets, such as buildings, machinery, office equipment and vehicles are depreciated over their useful lifetime.
The asset is initially recorded in the balance sheet of the reporting entity at its original cost.
In each reporting period, an appropriate amount of depreciation is charged to the income statement as an expense, and deducted from the carrying value of the asset in the balance sheet.
The total deduction from the original cost, to arrive at the carrying amount, is known as the accumulated depreciation.
Land is not normally depreciated as its value is not generally considered to diminish over time.