Chapter 6: Analysis of Long-Term Assets

In this section

• Capitalization of Costs vs. Immediate Expensing
  Explore how firms decide between capitalizing a cost as a long-term asset or expensing it immediately, the resulting impacts on financial statements and ratios, and key considerations under IFRS and US GAAP.
• Depreciation, Amortization, and Asset Impairment
  Explore key methods and concepts of depreciation, amortization for intangible assets, and asset impairment under IFRS and US GAAP, with real-world examples and advanced insights for CFA Level III candidates.
• Derecognition and Disposal of Long-Term Assets
  Learn how to remove long-term assets from the balance sheet, calculate gains or losses on disposal, and analyze the impact on key financial ratios under IFRS and US GAAP.
• Intangible Assets: Internally Developed vs. Acquired
  Explore IFRS vs. US GAAP recognition and measurement approaches to intangible assets, focusing on both internally developed and acquired intangibles, key analytical implications, and potential earnings management practices.
• Revaluation vs. Cost Model
  An in-depth exploration of how IFRS and US GAAP treat long-term asset valuation differently, from acquisition costs to periodic fair value remeasurements, focusing on analytical implications, best practices, and common pitfalls.
• Component Depreciation and Partial Asset Retirements
  Explore IFRS-compliant component depreciation, the intricacies of partial asset retirements, and how these practices affect financial reporting under both IFRS and US GAAP.
• Exploration and Evaluation Assets in the Extractive Industry
  A thorough exploration of accounting approaches, challenges, and analysis techniques for exploration and evaluation (E&E) assets in oil, gas, and mining, integrating IFRS 6 and US GAAP considerations.
• Reclassification of Assets under Construction
  Explore the importance of reclassifying Assets under Construction, from IFRS and US GAAP perspectives, including real-world examples, best practices, and key implications for ratio analysis.
• Real Estate (REIT) Treatment of Long-Term Assets
  Explore the unique nuances of REIT accounting, valuation, and disclosures under IFRS and US GAAP, including cost vs. fair value models, Funds from Operations (FFO), Adjusted Funds from Operations (AFFO), and Net Asset Value (NAV). Gain insights into regulatory requirements, potential pitfalls, and real-world applications.