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Accounting Standards 6 and 10 on ‘Depreciation Accounting’ and ‘Accounting for Fixed Assets’
Accounting
Assets

Financial Audit Autonomous Bodies,
AS 6 and AS Session 1.5 9

1

Session Coverage

• AS-6 ‘Depreciation
Accounting’;
A i ’
• and d • AS 10 ‘Accounting for Fixed
AS-10 Accounting
Assets’
Financial Audit Autonomous Bodies,
AS 6 and AS Session 1.5 9

2

Learning Objective
• At the end of this session, the learner will be able to apply the concepts contained in the Accounting
Standard 6 – ‘Depreciation Accounting’ and
Accounting Standard 10 – ‘Accounting for Fixed
Assets’ in the preparation and presentation of financial assets to the extent that he will, as an
Auditor,
Auditor be able to comment in his report where the financial statements are not in conformity with these standards.
Financial Audit Autonomous Bodies,
AS 6 and AS Session 1.5 9

3

AS 6 – Depreciation Accounting
• This Statement deals with depreciation accounting and applies to all depreciable g pp p assets, except :

Financial Audit Autonomous Bodies,
AS 6 and AS Session 1.5 9

4

AS 6 – Depreciation Accounting
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i. forests, plantations and similar regenerative natural resources; ii. ii wasting assets including expenditure on the i i l di di h exploration for and extraction of minerals, oils, natural gas and similar non regenerative non-regenerative resources; iii. expenditure on research and development; iv. goodwill;
v. live stock.
Financial Audit Autonomous Bodies,
AS 6 and AS Session 1.5 9

5

AS 6 – Depreciation Accounting
• This statement also does not apply to land unless it has a limited useful life for the enterprise. Financial Audit Autonomous Bodies,
AS 6 and AS Session 1.5 9

6

AS 6 – Depreciation Accounting

Definitions fi i i
• Depreciation is a measure of the wearing out, consumption or other loss of value of a depreciable asset arising from use, passage of