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Fixed asset Capitalisation policy

12 February 2023

Hi,

What are companies act latest provision for fixed asset Capitalisation threshold? Can a company choose to adopt a policy for capitalising assets with unit cost of INR 10000 or 15000 or more? What are applicable provisions of companies act and IND AS in this regard. Please guide.

Thanks

Rishi

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3 Replies

sabyasachi mukherjee (26345 Points)
Replied 13 February 2023

Assets less than 5000 are debited to pl account.Assets worth more than 10000 to 15000 are included in block of asset.

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Rishi Sharma (15 Points)
Replied 13 February 2023

Thanks. Currently we have same policy of capitalising item with unit cost of Rs 5000, and now we want to increase that threshold to Rs 10000 meaning everything less than Rs 10000 will be charged to p&l and if unit cost is more than Rs 10000 then it will be capitalised. Is this allowed under companies act? If yes, what are the required provisions under companies act and IND AS? Please advise.