Financial Education

IAS define an asset as “a resource controlled by the enterprise as a result of past events and from which future economic benefits are expected to flow to the enterprise.” U.S. GAAP similarly defines assets as “probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events.” Assets can be classified as either current or noncurrent, depending upon how long it is expected to take them to generate cash (or be used up). Those expected to generate cash within the longer of one year or the operating cycle are current, while longer-lasting assets are non-current. A typical classification of assets is presented below.

For more information, see all articles on: Accounting, Financial Statement Analysis, Fundamental Analysis

See also:

Upward Revaluation of Assets

Current Assets

Tobin’s q

The 3-Stage DuPont Model

Comparability Issues for Non-current Assets