Journals / Sosyal Ekonomik Araştırmalar Dergisi / 2012 / Cilt: 12 - Sayı: 24
ANALYSIS OF DEPRECIATION TRANSACTIONS IN TANGIBLE FIXED ASSETS IN TERMS OF ACCOUNTING STANDARDS AND TAX LEGISLATION AND ASSESSMENT OF ITS EFFECTS ON FINANCIAL STATEMENTS
- Pages
- 185–216
- DOI
- —
Abstract
The concept of tangible fixed asset is used to describe physical assets with limited economic life (benefit) held by enterprises to be used throughout multiple business periods, which are subject to wear and tear and loss of value throughout the time they are to be used. Amortization, lexical meaning of which is wear and tear depreciation, on the other hand, is in the broadest sense the partition of costs of the fixed asset to multiple periods by certain methods. The accuracy of depreciation transactions of tangible fixed assets, which are of particular importance for industrial enterprises are essential for correct calculation of costs, pricing decisions and in terms of financial position statements are prepared according to the needs of financial information users. Regulations regarding depreciation transactions in our country are present in tax legislation, International Financial Reporting Standards (IFRS), Turkish Accounting Standards 16 (TAS 16) and Turkish Financial Reporting Standards for SMEs (TFRS for SMEs). Although there are many articles regarding depreciation in many acts in tax legislation, regulations on the concerned issue are for the most part present in Tax Procedures Law (TPL). While all enterprises in our country have to abide by the provisions of TPL, public enterprises which are only responsible against the public have to conform to full set of TASs. However, the new Turkish Commercial Code (TCC) which will enter into force as of 1st of July, 20112 will impose obligations on enterprises which are not accountable against the public and prepare general purpose financial statement to abide by TFRS for SMEs. There are different applications regarding depreciation transactions in tax legislation, Full set TAS and TFRS for SMEs. In the basis of these differences lie the different aspects taken by the tax legislation and accounting standards to depreciation. The focus in tax legislation is on correct calculation of tax base whereas in accounting standards, the focus is on producing fair information Among the major differences between Tax Procedures Law (TPL) and accounting standards is the calculation of depreciable value. While the residual value is avoided in determining depreciable value according to TPL, according to TAS 16 and TFRS for SMEs, depreciable value is determined after residual value is deducted from cost value of the asset. On the other hand, while interest expenses occurred during the acquiring of the asset, delay interests, currency exchange differences and commission expenses have to be included in the cost of the asset, according to TAS 16, concerned borrowing costs are not included in the asset cost, except in qualifying assets. According to TFRS for SMEs, however, the total of such borrowing costs are regarded as period costs and are under no circumstances associated with asset cost. According to TPL, asset’s cost value is not changed as long as the asset is not subjected to a value or capacity increasing expenditure or inflation adjustment in financial statements. According to accounting standards, cost value is revaluated after being activated. According to TAS 16, however, while enterprises are able to use either one of cost or revaluation methods in asset valuation, according to TFRS for SMEs, only the cost method can be used. Hence, while tangible fixed assets can be indicated below or above the cost value in financial statements in valuation periods following the first year when they are credited according to TAS 16, according to TFRS for SMEs, tangible fixed assets are not reflected to financial statements with values exceeding the cost value. Another difference between TPL and accounting standards is regarding the period of depreciation. Depreciation period, according to TPL, starts in the year when the asset is credited and depreciation is carried out on an annual basis according to economic life determined by the Ministry of Finance. According to this code, date is set as the basis for determining depreciation period. The enterprise is able to continue to depreciate for tangible fixed assets with selling purposes and future non-useful fixed assets. According to TMS 16 and TFRS for SMEs however, depreciation period starts when the asset is usable and depreciation is carried out according to the useful time determined by the enterprise. Predictions of the enterprise regarding the useful life are updated annually. In determining the depreciation period, accounting period is set as basis. Furthermore, according to accounting standards, depreciation transactions are discontinued for tangible fixed assets with selling purposes and future non-useful fixed assets. There are differences between TPL and accounting standards in accepted methods of depreciation. TPL is mainly based on normal depreciation method and declining balance method. Additionally, exceptional depreciation method and depreciation method specific for mines are also legally accepted under certain circumstances. Among these methods, normal depreciation method can be used by tax payers who keep their books according to operation account and balance sheets while declining balance method can be used only by tax payers who use balance sheet in keeping their accounts. According to TPL, it is possible for enterprises using declining balance method to use normal depreciation method for a single time. However, as per the previsions of the code, it is not possible to use declining balance method once the normal depreciation method is used. Pro-rata deprecation method can only be used in passenger cars based on monthly periods and depreciation not carried out in the first year can be included to the amount of the final year. The subjects of depreciation methods are arranged in parallel in to TMS 16 and TFRS for SMEs. According to accounting standards, the depreciation methods the enterprises can prefer are straight-line depreciation, declining balance method and unitsof-production method. Ent
Özet
Maddi duran varlık kavramı, işletmelerin birden çok faaliyet döneminde kullanmak amacıyla edindikleri fiziki yapısı olan, kullanıldıkları süre içinde aşınmaya, yıpranmaya ve değer kaybına uğrayan sınırlı bir ekonomik (yararlı) ömrü olan varlıkları açıklamak için kullanılmaktadır. Özellikle sanayi işletmelerinde önemli bir yer tutan maddi duran varlıklara ilişkin amortisman işlemlerinin doğruluğu maliyetlerin doğru bir şekilde hesaplanması, fiyatlama kararları ve finansal tabloların finansal bilgi kullanıcılarının ihtiyacına uygun olarak düzenlemesi açısından son derece önemlidir. Bu çalışmada Vergi Usul Kanunu (VUK), Türkiye Muhasebe Standardı 16 (TMS 16) ve KOBİ Türkiye Finansal Raporlama Standartları (KOBİ TFRS)’ndaki düzenlemeler doğrultusunda maddi duran varlıklarda amortisman ayrılması konusu ele alınmıştır. Ayrıca düzenlemeler arasındaki farklılıklar açıklanarak, söz konusu farklılıkların finansal durum tablosu ve gelir tablosu üzerindeki etkisi incelenmiştir.