Assets

SUBJECT	IFRS	US GAAP
Assets
Acquired intangible assets	Capitalise if recognition criteria are met; intangible assets must be amortised over useful life. Intangibles assigned an indefinite useful life must not be amortised but reviewed annually for impairment. Revaluations are permitted in rare circumstances.	Capitalise purchased intangible assets, amortise over useful life and review for impairment. Intangibles assigned an indefinite useful life must be not be amortised but reviewed for impairment annually. Revaluations are not permitted.
Internally generated intangible assets	Expense research costs as incurred. Capitalise and amortise development costs only if stringent criteria are met.	Expense both research and development costs as incurred. Some software and website development costs must be capitalised.
Property, plant and equipment	Use historical cost or revalued amounts. Regular valuations of entire classes of assets are required when revaluation option is chosen.	Revaluations not permitted.
Non-current assets held for sale	Non-current asset is classified as held for sale if its carrying amount will be recovered principally through a sale transaction rather than through continuing use. Measure a non-current asset classified as held for sale at the lower of its carrying amount and fair value less costs to sell.	Similar to IFRS.
Leases – classification	A lease is a finance lease if substantially all risks and rewards of ownership are transferred. Substance rather than form is important.	Similar to IFRS, but with more extensive form-driven requirements.
Leases – lessor accounting	Record amounts due under finance leases as a receivable. Allocate gross earnings to give constant rate of return based on (pre-tax) net investment method.	Similar to IFRS, but with specific rules for leveraged leases.
Impairment of assets	If impairment indicated, write down assets to higher of net selling price and value in use based on discounted cash flows. If no loss arises, reconsider useful lives of those assets. Reversals of losses permitted in certain circumstances.	Impairment is assessed on undiscounted cash flows for assets to be held and used. If less than carrying amount, measure impairment loss using market value or discounted cash flows. Reversals of losses prohibited. For assets held for disposal, impairment is based on lower of carrying amount and fair value less cost to sell.
Capitalisation of borrowing costs	Permitted, but not required, for qualifying assets.	Required.
Investment property	Measure at depreciated cost or fair value and recognise changes in fair value in the income statement.	Treat the same as for other properties (depreciated cost).
Inventories	Carry at lower of cost and net realisable value. Use FIFO or weighted average method to determine cost. LIFO prohibited. Reversal is required for subsequent increase in value of previous write-downs.	Similar to IFRS; however, use of LIFO permitted. Reversal of write-down is prohibited.
Biological assets	Measured at fair value less estimated point-of-sale costs.	Not specified. Generally historical cost used
Financial assets – measurement	Depends on classification of investment – if held to maturity or loan or receivable, then carry at amortised cost, otherwise at fair value. Unrealised gains/losses on fair value through profit or loss classification (including trading securities) recognised in the income statement and on available-for-sale investments recognised in equity.	Similar to IFRS; however, no ability to designate any financial asset or liability as at fair value through profit or loss.
Derecognition of financial assets	Derecognise financial assets based on risks and rewards first; control is secondary test	Derecognise based on control. Legal isolation of assets even in bankruptcy is necessary for derecognition.