Hi, and welcome to part five:
in this HSTalks lecture series
on Analyzing Financial Statements.
My name is David Bond.
In this video, we'll look at
how to account for non-current assets.
are vital to all entities.
Examples of non-current assets
include land and buildings,
brand names, and goodwill.
The two primary topics of non-current assets
and the ones we'll be looking at
in this video
are property, plant, and equipment,
often known as PPE and intangible assets.
But before we get started,
what are PPE and intangible assets?
PPE are tangible items
that are held for use
in the production
or supply of goods or services,
for rental to others,
or for administrative purposes,
and are expected to be used
during more than one period.
Examples of PPE include land,
buildings, machinery, ships,
aircraft, motor vehicles,
office equipment, and so on.
Intangible assets have a shorter definition
and are simply identifiable
without physical substance.
Examples of intangible assets
include goodwill, brand names,
patents, licenses, customer lists, and so on.
Identifiability in short means
the asset is separable from the entity.
For example, the entity could
sell the asset to another entity
without physical substance is the crux of it.
are things you cannot touch.
So whereas a car would be property,
plant, and equipment,
a license to operate that car as a taxi
would be an intangible asset.