Self-Study
12
Overview
Accounting
There are no prerequisites.

Course Description

Accounting for fixed assets can be a complex area with extensive implications on a company's value. In this thorough and well-written course, accounting expert Steven Bragg uses real-life examples to illustrate the principles covered, and offers helpful tips and advice that can be easily implemented. This course addresses both the GAAP and IFRS accounting for all aspects of fixed assets, including their initial purchase, impairment, revaluation, and disposal.

This course also covers:

  • Disclosure of fixed asset information
  • Capital budgeting
  • Asset recognition
  • Interest capitalization
  • Asset retirement obligations
  • Financial statement disclosures associated with fixed assets
  • Creating strong control systems for fixed assets
  • Fixed asset record keeping
  • Ratios that can be used to monitor fixed assets


Instructor

Steven M. Bragg, CPA

Steven M. Bragg, CPA, is a full-time book and course author who has written more than 70 business books. He provides Western CPE with self-study courses in the areas of accounting and finance, with an emphasis on the practical application of accounting standards and management techniques. A sampling of his courses include the The New Controller Guidebook, The GAAP Guidebook, Accountants’ Guidebook, and Closing the Books: An Accountant’s Guide. He also manages the Accounting Best Practices podcast.

Steven has been the CFO or controller of both public and private companies and has been a consulting manager with Ernst & Young and an auditor with Deloitte & Touche. He holds an MBA from Babson College, a Master of Finance from Bentley College, and a BA from the University of Maine (summa cum laude).



Course Specifics

Accounting
Aug 23, 2017
There are no prerequisites.
SS1143213
267
None


Compliance Information

103220
Qualifies for CA Fraud: No


Learning Objectives

Upon successful completion of this course, participants will be able to:

Chapter 1

  • State why construction in progress is a temporary account
  • Identify an advantage of having many fixed asset classifications
  • Define depreciation

Chapter 2

  • Specify where constraint analysis is used
  • Define throughput
  • List a way the payback method works well in analyzing a budget

Chapter 3

  • Identify fixed asset costs to be capitalized and how to value fixed assets acquired in a business combination
  • Cite when to capitalize a lease
  • State how to account for a major inspection under IFRS

Chapter 4

  • Specify when to capitalize interest and which projects to capitalize interest on
  • Cite when to terminate interest capitalization in a dependent completion project
  • Define interest capitalization rate

Chapter 5

  • Identify when to defer an asset retirement obligation and what to do with a retirement obligation when there is no probability distribution
  • Define accretion expense

Chapter 6

  • Define depletion
  • Identify when an assumption is made using the mid-month convention
  • Calculate first-year depreciation using the double declining balance method
  • Specify when depreciating land is acceptable

Chapter 7

  • Cite possible choices and best practices for situations under the IFRS revaluation model
  • Identify when you are permitted to revalue fixed assets on a rolling basis

Chapter 8

  • Identify what to do if an asset group is impaired
  • Cite when it is permissible to reverse an impairment loss under GAAP
  • Specify how to tell that a prior impairment loss has been reduced under IFRS

Chapter 9

  • Cite how to measure fixed assets that are being moved out of held for sale status
  • Identify proper accounting for abandoned, temporarily idle, or disposed of assets

Chapter 10

  • Identify what should be disclosed under GAAP for capitalized interest or an impairment loss on an intangible asset
  • Identify items not disclosed under IFRS concerning change of estimate information or optional fixed asset disclosure

Chapter 11

  • Cite when to record a contributed asset as a gain and what may be recorded from contributions of art
  • Cite proper recognition of conditional promises to give

Chapter 12

  • Cite why a single accumulated depreciation account is advantageous
  • Define chart of accounts
  • Identify the purpose of the responsibility report and project cost sheet

Chapter 13

  • Define a fixed asset acquisition control
  • Identify what areas specific actions are designed to be controls for
  • Cite what is included in a good corporate capitalization limit

Chapter 14

  • Specify when an interest capitalization procedure is unnecessary
  • Identify when fixed asset transfer policies are not being utilized best

Chapter 15

  • Identify potential uses of a paper identification tag and an alternative to a metal tag
  • List two benefits of bar code tags in asset tracking
  • Identify what wireless monitors can and cannot track

Chapter 16

  • Identify the effect of an increasing ratio of repairs and maintenance to fixed assets
  • Identify a situation that are not best for using the fixed asset requirements ratio
  • Specify the purpose of return on operating assets
  • List effects of unscheduled machine downtime

Chapter 17

  • Identify why auditors may perform actions like comparing the capital budget to actual purchases or match assets to a fixed asset register during a physical count
  • Identify an audit activity related to fixed asset disposals
  • Cite the purpose of the purchases detail binder


Table of Contents

Preface

Chapter 1 – Introduction to Fixed Assets

Learning Objectives

Introduction

Introduction to Fixed Assets Terminology

What are Fixed Assets?

The “Fixed Asset” Designation

Fixed Asset Classifications

Applicable Accounting Frameworks

Accounting for Fixed Assets

Accounting for Intangible Assets

Accounting for Not-for-Profit Fixed Assets

Fixed Asset Disclosures

Fixed Asset Controls

Fixed Asset Policies and Procedures

Fixed Asset Record Keeping

Fixed Asset Auditing

Fixed Asset Measurements

Summary

Chapter 1 Review Questions

Chapter 2 – Capital Budgeting Analysis

Learning Objectives

Introduction

Overview of Capital Budgeting

Bottleneck Analysis

Net Present Value Analysis

The Payback Method

Capital Budget Proposal Analysis

The Outsourcing Decision

The Capital Budgeting Application Form

The Post Installation Review

The Lease or Buy Decision

Capital Budgeting with Little Cash

Summary

Chapter 2 Review Questions

Chapter 3 – Initial Fixed Asset Recognition

Learning Objectives

Introduction

The Capitalization Limit

The Base Unit

GAAP: The Initial Measurement of a Fixed Asset

Interpretive Commentary

GAAP: The Measurement of Assets Acquired in a Business Combination

GAAP: The Measurement of Assets Acquired in a Capital Lease

GAAP: Non-Monetary Exchanges

GAAP: Internal-Use Software

GAAP: Website Development Costs

IFRS: Initial Inclusions in a Fixed Asset

IFRS: Initial Cost of a Fixed Asset

IFRS: The Measurement of Assets Acquired in a Business Combination

IFRS: The Measurement of Assets Acquired in a Capital Lease

IFRS: Non-Monetary Exchanges

Summary

Chapter 3 Review Questions

Chapter 4 – Interest Capitalization

Learning Objectives

Introduction

Why and When Do We Capitalize Interest?

Assets for Which You Must Capitalize Interest

Assets for Which You Do Not Capitalize Interest

The Interest Capitalization Period

The Capitalization Rate

Calculating Interest Capitalization

Derecognizing Capitalized Interest

Interest Capitalization under IFRS

Summary

Chapter 4 Review Questions

Chapter 5 – Asset Retirement Obligations

Learning Objectives

Introduction

The Liability for an Asset Retirement Obligation

The Initial Measurement of an Asset Retirement Obligation

Subsequent Measurement of an Asset Retirement Obligation

Settlement of an Asset Retirement Obligation

Overview of Environmental Obligations

Measurement of Environmental Obligations

Recoveries Related to Environmental Obligations

Asset Retirement Obligations under IFRS

Summary

Chapter 5 Review Questions

Chapter 6 – Depreciation and Amortization

Learning Objectives

Introduction

The Purpose of Depreciation

Depreciation Concepts

Accelerated Depreciation

Straight-Line Method

Sum-of-the-Years’ Digits Method

Double-Declining Balance Method

Depletion Method

Units of Production Method

MACRS Depreciation

The Depreciation of Land

The Depreciation of Land Improvements

Group Depreciation

Composite Depreciation

Depreciation Accounting Entries

Accumulated Depreciation

Depreciation under IFRS

Other Depreciation Topics

Impact on Cash Flow Analysis

Depreciation and Market Value

Summary

Chapter 6 Review Questions

Chapter 7 – Subsequent Fixed Asset Measurement

Learning Objectives

Introduction

The Capitalization of Additional Expenditures

Asset Revaluation for Tangible Assets

Asset Revaluation for Intangible Assets

Summary

Chapter 7 Review Questions

Chapter 8 – Fixed Asset Impairment

Learning Objectives

Introduction

Asset Impairment under GAAP

GAAP: Measurement of Asset Impairment

GAAP: Impairment Testing Exemption for Intangible Assets

GAAP: The Impact of Asset Retirement Obligations

GAAP: Measurement of Disposal Losses on Assets Held for Sale

GAAP: The Asset to Be Tested

GAAP: Timing of the Impairment Test

GAAP: Accounting for the Impairment of an Asset Group

GAAP: Reversing an Impairment Loss

GAAP: Reversing a Disposal Loss

Asset Impairment under IFRS

IFRS: The Impairment Test

IFRS: The Asset to be Tested

IFRS: Goodwill and Impairment Testing

IFRS: Corporate Assets and Impairment Testing

IFRS: Timing of the Impairment Test

IFRS: Indications of Impairment

IFRS: Intangible Asset Measurement

IFRS: Determining Value in Use

IFRS: Determining the Fair Value Less Costs to Sell

IFRS: Accounting for the Impairment of an Asset

IFRS: Reversing an Impairment Loss

Summary

Chapter 8 Review Questions

Chapter 9 – Fixed Asset Disposal

Learning Objectives

Introduction

Asset Derecognition

The Held-for-Sale Classification

Reclassification from Held for Sale

Discontinued Operations

Abandoned Assets

Idle Assets

Asset Disposal Accounting

Asset Disposal under IFRS

Summary

Chapter 9 Review Questions

Chapter 10 – Fixed Asset Disclosures

Learning Objectives

Introduction

GAAP Disclosures

GAAP: General Fixed Asset Disclosures

GAAP: Asset Retirement Obligations

GAAP: Capitalized Interest Disclosures

GAAP: Change in Estimate Disclosures

GAAP: Intangible Asset Impairment Disclosures

GAAP: Intangible Asset Disclosures

IFRS Disclosures

IFRS: General Fixed Asset Disclosures

IFRS: Capitalized Interest Disclosures

IFRS: Change in Estimate Disclosures

IFRS: Estimates of Recoverable Amounts

IFRS: Held for Sale Disclosures

IFRS: Impairment Disclosures

IFRS: Intangible Asset Disclosures

IFRS: Revaluation Disclosures

IFRS: Optional Disclosures

Summary

Chapter 10 Review Questions

Chapter 11 – Not-for-Profit Fixed Asset Accounting

Learning Objectives

Introduction

Initial Recognition of Fixed Assets

Restrictions on Contributed Assets

Valuation of Contributed Assets

Valuation of Contributed Services

Valuation of Art, Historical Treasures, and Similar Items

Depreciation of Fixed Assets

Recordation of Fixed Assets

Fixed Asset Controls in a Not-for-Profit Entity

Summary

Chapter 11 Review Questions

Chapter 12 – Fixed Asset Record Keeping

Learning Objectives

Introduction

Fixed Asset Accounts

Construction Project Record Keeping

Building Record Keeping

Equipment Record Keeping

Land Record Keeping

Lease Record Keeping

Operating Lease Record Keeping

Capital Lease Record Keeping

Document Retention

Fixed Asset Reports

Depreciation Report

Audit Report

Responsibility Report

Asset Replacement Report

Maintenance Report

Summary

Chapter 12 Review Questions

Chapter 13 – Fixed Asset Controls

Learning Objectives

Introduction

Controls for Fixed Asset Acquisition

Controls for Fixed Asset Construction

Controls for Fixed Asset Theft

Controls for Fixed Asset Valuation

Controls for Fixed Asset Depreciation

Controls for Fixed Asset Disposal

The Control of Laptop Computers

Summary

Chapter 13 Review Questions

Chapter 14 – Fixed Asset Policies and Procedures

Learning Objectives

Introduction

Capital Budgeting Policies and Procedures

The Capital Request Form

Asset Recognition Procedures

Asset Revaluation Policies and Procedures

Asset Exchange Policies and Procedures

Depreciation Policies and Procedures

Impairment Policies and Procedures

Asset Retirement Obligation Policies and Procedures

Intangible Asset Policies and Procedures

Transfer Policies

Disposal Policies and Procedures

The Asset Disposal Form

Record Keeping Policies

Tracking Policies and Procedures

The Fixed Asset Manual

Summary

Chapter 14 Review Questions

Chapter 15 – Fixed Asset Tracking

Learning Objectives

Introduction

Tag Tracking

Bar Code Tracking

RFID Tracking – Active Transmission

RFID Tracking –Passive Transmission

Wireless Monitoring

Summary

Chapter 15 Review Questions

Chapter 16 – Fixed Asset Measurements

Learning Objectives

Introduction

Sales to Fixed Assets Ratio

Repairs and Maintenance Expense to Fixed Assets Ratio

Accumulated Depreciation to Fixed Assets Ratio

Cash Flow to Fixed Asset Requirements Ratio

Return on Assets Employed

Return on Operating Assets

Bottleneck Utilization

Unscheduled Machine Downtime

Summary

Chapter 16 Review Questions

Chapter 17 – Fixed Asset Auditing

Learning Objectives

Introduction

Fixed Asset Audit Objectives

Fixed Asset Audit Procedures

Auditor Requests

Summary

Chapter 17 Review Questions

Review Question Answers and Rationales

Appendix

Journal Entries

Glossary

Index

Final Examination

Answer Sheet

Course Evaluation

 



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