Comparative Analysis of Measurement after Recognition of Property, Plant and Equipment – IAS 16 vs. OMPF No. 1802/2014

• Main Author: Mărioara MOLOCINIUC (HRIȚCAN)
• Format: Article
• Language: English
• Published: The Body of Expert and Licensed Accountants of Romania 2021-04-01
• Series: CECCAR Business Review
• Subjects: impairment; valuation; property; plant and equipment; revaluation; net carrying value; just value
• Online Access: https://www.ceccarbusinessreview.ro/comparative-analysis-of-measurement-after-recognition-of-property-plant-and-equipment-ias-16-vs-ompf-no-1802-2014-a115d/download-PDF/

Valuating property, plant and equipment after recognition with the purpose of preparing the annual financial statements is an extremely important step in presenting a true and fair view of the entity. Thus, the companies must take into account the main valuation methods used and develop appropriate accounting policies and procedures to ensure that the users of financial and accounting information are properly informed and understand every change that occurs. The book value, respectively the carrying amount, of property, plant and equipment is represented abiding by the prudence concept, according to which every impairment or change from the determined value shall be taken into account. The efficiency with which these assets are valuated brings surplus value to the entity and has a direct impact on the financial statements.The main objective of this article is to present the methods of valuation used to valuate property, plant and equipment. This way, at the end of the research the main applicable accounting treatments and the differences between IAS 16 Property, Plant and Equipment and Order of the Minister of Public Finance No. 1802/2014 for the approval of the Accounting regulations regarding the individual annual financial statements and consolidated annual financial statements, as subsequently amended and supplemented, will be understood.