depreciation

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depreciation,

in accountingaccounting,
classification, analysis, and interpretation of the financial, or bookkeeping, records of an enterprise. The professional who supplies such services is known as an accountant. Auditing is an important branch of accounting.
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, reduction in the value of fixed or capital assets, as by use, damage, weathering, or obsolescence. It can be estimated according to a number of methods. In the straight-line method, depreciation is simply seen as a function of time; the cost of the asset, minus its value as scrap, is divided by an estimate of its life. Other methods distribute depreciation over the life of the asset by gradually increasing, or gradually diminishing, installments. The resale value of a machine generally declines most quickly during its early years; thus its depreciation is measured in decreasing installments. The opposite is true of rights of limited duration, such as copyrights and leaseholds, whose value depreciates most quickly as their date of expiration approaches. The technical name for the depreciation of such nonmaterial rights is amortization. The problem of calculating depreciation has special importance because of the need for accuracy in income tax returns. Failure to make allowance for depreciation results in overestimating income. Depreciation of money is brought about by a decline in the price of a particular currency in terms of other currencies, thereby lowering the foreign exchange value of the first currency.

Bibliography

See J. D. Coughlan, Depreciation (1969); R. P. Brief, ed., Depreciation and Capital Maintenance (1984).

The Columbia Electronic Encyclopedia™ Copyright © 2013, Columbia University Press. Licensed from Columbia University Press. All rights reserved. www.cc.columbia.edu/cu/cup/

Depreciation

The reduction in the value or worth of an asset, such as a building, through physical deterioration over time, and general obsolescence.
Illustrated Dictionary of Architecture Copyright © 2012, 2002, 1998 by The McGraw-Hill Companies, Inc. All rights reserved

depreciation

[di‚prē·shē′ā·shən]
(industrial engineering)
Loss of value due to physical deterioration.
McGraw-Hill Dictionary of Scientific & Technical Terms, 6E, Copyright © 2003 by The McGraw-Hill Companies, Inc.

depreciation

Economics a decrease in the exchange value of currency against gold or other currencies brought about by excess supply of that currency under conditions of fluctuating exchange rates
Collins Discovery Encyclopedia, 1st edition © HarperCollins Publishers 2005
References in periodicals archive ?
'While the write-downs were not foreshadowed, it certainly comes as no surprise given the deterioration in metals prices, particularly copper,' said Richard Rossiter, mining analyst at JP Morgan.
This write-down will charge business area Construction in the fourth quarter of 2015.
The write-down will reduce net profit and cut capital by AUD27m without affecting dividends, Brisbane-based Suncorp said.
This SEK250m charge includes write-downs of goodwill, claims and litigations related to a number of completed projects in the Oslo region, as well as write-downs of project properties.
This notching comprises two notches for loss severity in light of the notes' deep subordination, and two notches for additional non-performance risk relative to the VR given fully discretionary coupons and a high write-down trigger.
insufficient to remedy the write-down event a write down of all or part
KDB officials said the group was claiming that the capital write-down ratio was excessive.
"We are also deeply disappointed to have to take a further substantial write-down in our aluminium businesses." Whilst the stock experienced heavy losses early on Thursday, when the news was released, these were later trimmed, helped by several broker upgrades and shares finished the day down 0.5%.
According to the BBC, the write-down effectively wipes out the acquisition's value, although there was little impact on Microsoft's share in after-hours trading on Monday.
The bank said that it has increased the write-down on its FIA Card Services because of deteriorating credit quality.
25 January 2011 - Finnish IT consultancy Trainers' House Oyj (HEL:TRH1V) said today it will book a goodwill write-down of EUR14.4m (USD19.7m) in 2010 after an updated impairment testing.