Required: Evaluate the implications of accounting procedures for the recording and management of non-current assets in Australia.In this topic you should consider how accounting for non-current assets...

1. INTRODUCTION
The aim of the accounting for the non-current assets is for the better management and also to provide clear and true data with respect to the assets in the financial statements. The Non-Current Asset includes the items of plant & equipment, property, intangible assets and assets held for resale. The accounting foe the non-current assets is required in the following cases: Acquiring, developing or constructing a non-current asset Costs incurred for keeping of a non-current asset Revaluation of non-current assets Disposal of non-current asset Accounting for the depreciation or amortization of non-current assets Reporting and disclosing non-current assets impairment of non-current assets.
2. APPLICABLE AUSTRALIAN ACCOUNTING STANDARDS
The following Australian Accounting Standards are applicable in the accounting of the non-current assets:
· AASB 13 – Fair Value Measurement
· AASB 101 – Presentation of Financial Statements
· AASB 116 – Property, Plant and Equipment
· AASB 136 – Impairment of Assets
· AASB 1041 – Revaluation of non-current assets
· Any other relevant standard
3. INITIAL RECOGNITION
The Non-Current Asset includes the items of plant & equipment, property, intangible assets and assets held for resale. The following criteria in relation to the item to be recognized as a non-current asset should be met:
· The company has got the control over the asset to be classified as non-current.
· It is necessary that the future economic benefits associated with the asset under consideration must flow to the company.
· There must be occurrence of a transaction or an event in the past which have resulted in the occurrence e of the asset under consideration.
· For an asset to be classified as a non-current asset the same must be have a useful life of more than one year. (Cairns, D., Massoudi, D., Taplin, R. and Tarca, A., 2011.)
As per the Australian accounting standard AASB 116(10) the asset under consideration is recognized when the cost associated with the asset have been incurred. The cost of an asset includes the following:
· Purchase price less any deductions in the form of discounts, rebate
· Costs associated directly with the bringing of the asset to its location. For example cost associated with the construction or acquisition of the asset, Site preparation cost, site restoration cost, Assembly costs, and inspection cost act.
However purchase Costs exclude the following costs: Marketing and advertising costs. Maintenance costs incurred after the asset is put to use. Avoidable costs. Financing Costs include the amount of Interest charged on borrowings made for purchase of asset. Preliminary Study costs incurred. (White, G.I., Sondhi, A.C. and Fried, D., 1998.)
4. POST ACQUISITION EXPENDITURE
The expenditure incurred on an asset after it is put to use are mainly of two types:
• Capital Expenditure – these are the expenditure costs incurred to add value to the asset under consideration. Certain costs incurred over the useful life of an asset are of such a nature that they bring a change in the asset under consideration by way of renewal, extension or up gradation of the asset...