Extraordinary depreciation
In the context of unscheduled depreciation , unscheduled impairments are recorded in the company's internal or external accounting , i.e. impairments that are not caused by scheduled use in the company. This can be, for example:
- Damage due to accidents or force majeure
- External value fluctuations, d. H. falling market values of assets
- technical obsolescence
In German commercial balance sheet law, depreciation is made to a market value of the asset in question that is below the current book value. This can e.g. B. the market value of a security. In German tax accounting law, depreciation is made to the lower partial value , which is also de facto a market value. According to IFRS , an unscheduled write-down is made to the higher of the internal value in use and the net realizable value ( fair value less cost to sell ).
In contrast to the scheduled depreciation, the unscheduled depreciation can be carried out not only for depreciable assets, but also for all assets, including current assets. In terms of booking, there are basically There are no differences between the two types of depreciation; even with unscheduled depreciation, the general posting rate is expenditure on assets . However, expenses due to an unscheduled depreciation are recorded as extraordinary expenses instead of ordinary, in order to indicate that the depreciation does not result from normal business operations.
In German commercial balance sheet law, unscheduled depreciation follows the lower of cost or market principle , which results from the principle of prudence . According to German commercial balance sheet law, non-scheduled depreciation may only be carried out on fixed assets if the decrease in value is likely to be permanent (moderate lower value principle). This restriction does not apply to current assets. If the value rises again after an unscheduled depreciation has taken place, the value must be reversed to the higher value.
In German tax law, unscheduled depreciation is called partial depreciation ( see there for details ).