THEORETICAL STUDY OF LONG-TERM TANGIBLE ASSETS ACCOUNTING METHODS AND THEIR IMPACT ON OPERATIONAL RESULTS
Keywords:long-term tangible assets accounting method, acquisition cost, fair value, profit
In many companies, long-term tangible assets make up most of the available assets, and depreciation amounts are a significant part of the costs, so it is important to account for these assets accurately and correctly. For this reason, the theoretical research aims to reveal the relationship between long-term tangible assets accounting methods and performance and to define at a theoretical level what influence the chosen accounting methods have on the company's performance and how to evaluate this influence. After analyzing the scientific literature, profit-increasing and decreasing accounting methods were distinguished. It was established that the profit could be increased by registering long-term tangible assets at the cost of acquisition, the directly proportional method was chosen to calculate the depreciation of long-term tangible assets. A higher liquidation value of the asset, a lower minimum value, and a longer useful life lead to an increase in profit. When researchers analyzed the impact of the revalued value method on performance results, they usually evaluated it with relative indicators. The performed analysis revealed that more and more companies choose the revalued value method due to the opportunity to objectively assess cash flows and see a more realistic financial condition of the company.