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U.S. GAAP Long-Lived Assets |
IFRS Long-Lived Assets |
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Cost components similar to IFRS except that hedging gain/loss from qualifying cash flow hedges are not includable
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Cost components similar to US GAAP, but gain/loss from effective cash flow hedging can be added to basis of asset |
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Change in depreciation method now handled prospectively under recently imposed standard
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Change in method accounted for prospectively |
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Mandatory capitalization of construction pe-riod interest costs, only interest costs are subject to capitalization (no ancillary costs can be included)
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Former optional expensing or capitalization of construction period interest ended by revised IAS 23; capitalization now mandatory; ancillary costs also can be capitalized |
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Costs of major overhauls generally expensed
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Costs of major overhauls added to asset |
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Cost basis required |
Alternatively can use cost basis or revaluation to fair value (entire class of asset must be accounted for under revaluation method)
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Impairments recognized in current income
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If cost method used, impairments are recog-nized in income; if revaluation employed, impairment treated as reversal of revaluation unless it exceeds former write-up, in which case excess impairment taken to current income |
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Impairment suggested when book value exceeds gross expected future cash flows; second step to measure amount of impairment uses discounted present value of cash flows
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Impairment suggested when book value ex-ceeds greater of value in use (discounted cash flows) or fair value less cost to sell |
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Impairments, once recognized, cannot be reversed
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Recognized impairments reversed under defined conditions |
| Component-level depreciation expected; asset retirement obligations recognized as part of asset cost; changes in estimated amount of obligation effectively amortized over remain-ing term |
IFRS has been brought into closer conformity with US GAAP as to component depreciation, accrual of asset retirement obligations, al-though IFRS guidance on retirement obliga-tions is more general; changes in estimated amount of the obligation recognized over re-maining term if cost model is used (if revaluation model, impact is immediately felt in earnings)
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| Like-kind exchanges of productive assets are now measured at fair value, with gain or loss recognized, similar to IFRS |
Like-kind exchanges measured at fair value, with gain or loss recognized
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| Investment property must be carried at depreciated cost |
Investment property can be carried at depreciated cost or fair value
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Segregate asset held for sale, write down to lower of amortized cost or fair value less estimated costs to dispose, cease depreciating assets; comparative balance sheet reclassified to report disposal group separately
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Similar to US GAAP approach, except comparative balance sheet is not restated |
