GAAP (Generally Accepted Accounting Principles) Provides A Framework For Recording And Managing Fixed Assets. Key Aspects Of GAAP Fixed Asset Policy Include Capitalization Thresholds, Depreciation Methods, And Impairment Testing.
Capitalization Thresholds: GAAP Requires Businesses To Capitalize Assets That Meet Certain Criteria, Ensuring They Are Recorded As Long-term Investments Rather Than Immediate Expenses.
Depreciation Methods: GAAP Outlines Accepted Methods Such As Straight-line, Double-declining Balance, And Units Of Production. Each Method Impacts Financial Statements Differently And Must Be Chosen Based On Asset Usage.
Impairment Testing: GAAP Mandates Regular Testing Of Asset Value To Ensure It Hasn't Declined Below Its Book Value. If An Impairment Is Identified, Businesses Must Write Down The Asset Value Accordingly.
Using Nova Technosys Fixed Assets Register ERP, Companies Can Seamlessly Adhere To GAAP Policies With Automated Processes And Accurate Financial Reporting.