Ias 16 essay

Major issues addressed are how assets are recognized, how to determine their carrying amount and how depreciation charges and impairment losses are recognized in relation to the given assets (Frank W.,2008) This IAS is used to account for Property, Plant and Equipment.

1.0 INTRODUCTION The objective of this report is to present the factual findings of the audit of operating leases to the CFO and CEO of the XYZ limited. The XYZ’s 2015 financial statements has shown the material amount of operating leases and therefore needs particular attention during the course of audit.

International Accounting Standard 16 (IAS 16) is to outline the treatment for most types of property, plant and equipment. Initially, Property, Plant and Equipment will be realised at its cost and after that it will be measured either using a cost or revaluation model.