Depreciation and impairment of non-financial assets in higher education institutions: Analysis and evaluation

Abstract

Subject. The article investigates the state of presentation of information on depreciation and impairment of non-financial assets by Russian universities, and prospects for its improvement. Objectives. The aim is to summarize and systematize the provisions of the current federal accounting standards for public finance, governing the depreciation and impairment of non-financial assets, study the practice of accounting policy formation by higher education institutions in relation to non-financial assets based on the specifics of these organizations’ activities. Methods. The study employs observation, comparison, generalization, and interpretation, the analysis of the content of federal accounting standards for public finance, accounting policies for depreciation and impairment of non-financial assets of 26 higher education institutions in Russia. Results. Most higher education institutions do not consider the procedure for calculating depreciation of the structural part of fixed assets. Some universities apply the procedure for calculating amortization of intangibles that does not comply with the provisions of the federal accounting standards for public finance in relation to intangible assets with indefinite useful life. No university identifies signs of impairment or reflects non-financial assets less impairment losses in accounting statements, thus preventing their objective evaluation. Conclusions. I offered a unified approach to identifying external and internal signs of possible impairment of assets by higher education institutions, given the specifics of their activities. The paper established a sequence of actions when testing a cash-generating asset for impairment.