Plant assets definition
/What are Plant Assets?
Plant assets are a group of assets used in an industrial process, such as a foundry, factory, or workshop. These assets are a subset of the fixed assets classification, which includes such other asset types as vehicles, office equipment, and intangible assets. Plant assets fulfill the usual criteria for a fixed asset, which means that their initial cost exceeds the capitalization limit of the entity, and they are expected to be used for at least one year. They must also be reviewed for impairment at regular intervals. This classification is rarely used, having been superseded by such other asset classifications as Buildings and Equipment.
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Depreciation of Plant Assets
Plant assets are depreciated over their useful lives. The only exception is land, which cannot be depreciated.
Presentation of Plant Assets
Plant assets are reported within the property, plant, and equipment line item on the reporting entity’s balance sheet, where it is grouped within the long-term assets section. The presentation may pair the line item with accumulated depreciation, which offsets the reported amount of the asset.