What is Property, plant and equipment?

Q: What is Property, plant and equipment?

Physical assets used in the production of goods and services, for rental or for administrative purposes, and expected to be used for more than one period. Property, plant and equipment is recognised at cost; for subsequent measurement, the cost model or the revaluation model can be chosen. Significant parts with different useful lives are depreciated separately (the component approach). Depreciation rates under tax legislation and useful lives under TFRS may differ; this difference gives rise to deferred tax.

Property, plant and equipment is recognised at cost; for subsequent measurement, the cost model or the revaluation model can be chosen. Significant parts with different useful lives are depreciated separately (the component approach).

Depreciation rates under tax legislation and useful lives under TFRS may differ; this difference gives rise to deferred tax.

Source: TAS 16

Related terms

DepreciationThe systematic allocation of the cost of non-current assets to expense over their useful lives.Deferred taxTax payable or recoverable in future periods, calculated on temporary differences between the carrying amounts of assets and liabilities in the financial statements and their tax bases.Revaluation (tax)Bringing depreciable assets and their accumulated depreciation up to current values under tax legislation.Accounting policiesThe specific principles, bases, conventions, rules and practices an entity applies in preparing its financial statements.Amortised costThe amount at which a financial asset or liability is measured at initial recognition, minus principal repayments, plus cumulative amortisation calculated using the effective interest method.AssociateAn entity over which the investor has significant influence but not control or joint control.

Last updated: October 22, 2026 · This definition is for general information only.