Accounting treatment of items purchased in auction

Depreciation refers to decrease in the value of assets due to fear of obsolete and use, in-fact most of the assets have limited useful life. but there are some examples like land value of which almost not depreciate because value of land not decreased and it has its unlimited life. so we can say that if the value of assets not decreased due to impact of time then its value should not be depreciated, item mentioned above like antique, trophy or pen signed by Big B normally increase or remain same as they pass the time so in my opinion it should not be depreciated.

Mr.Nitesh

The pen is an antique for the company. It is an asset for the company. But no depreciation. The antique value increases day by day. Therefore appreciation value to be calculated.

As per AS-6

"Depreciable Assets"are assets which

(i)are expected to be used   during more than one accounting period;

(ii)have a limited useful life and 

(iii)are held by an enterprise for use in the production or supply of goods and services , for rental to others,  or for administrative purpose and not for the purpose of sale in the ordinary course of business..

There for it  shall be write off to P&L A\c 

it is not an Asset..

Income tax benefit also not available..  because the expenditure is not related to company 

i totally agree with mr rajesh....

the pen is not used in business neither is it giving any enduring benefits tot eh business...hence it cannot be taken as asset..if it is just bought for pleasure or hobby then charge off to p&l account.

HOWEVER, if the pen is bought with an intention to keep it in the business and wait for its value to increase and then sell it,they shall be treatyed as investments and hence should not be depriciated untill appropritate.hence the question of  depriciation is ruled out.