Each year in the life of a depreciable asset, some of its cost is charged against income on the income statement. Just how much is charged each year is determined by the appropriate schedule for the asset. Generally, depreciation can be claimed for assets that have a useful life of one year or more, are used in a trade or business, and are used up, wear out, decay, become obsolete, or otherwise lose value over their useful life. Assets that meet these criteria may include factory machines, vehicles, computer systems, office furniture, aircraft, and buildings. Land, however, is an example of an asset that does not meet the third criterion (lose value) and therefore cannot be depreciated in the same way.
For some assets, our CPAs can simply choose a number of years for the life based on the asset's expected useful life. For other types of assets, however, the depreciable life is prescribed by the country's tax authorities. It makes more sense for SVA to keep on top of all of these options, so you can manage your firm’s day-to-day operations.