What is Accounting Account 08.08 intended for?

Non-current assets - the main property of the enterprise, which will subsequently be distributed to other accounts. It also collects all data not only on the cost of fixed assets and intangible assets, but also the costs of their acquisition. Account 08 08 is intended just for such purposes. Let us consider in detail its characteristics and significance in the accounting system

Composition of non-current assets

The property rights of this group also include intangible assets that are planned to be used at the enterprise for more than a year. It consists of:

• OS owned by the enterprise and involved in the production process. At the same time, for a long time, the property does not lose its natural-material form.
• Investments of a long-term nature and in the form of capital.
• Any form of NMA.
• Other noncurrent assets.

The property of the enterprise belonging to this category of funds occupies a leading place in the activities of the enterprise, especially in production cycles. During the period of its use, the cost is gradually transferred to the finished product in the form of depreciation.

There are active and passive part of non-current assets. The first category includes the most mobile and dynamic means. For example, industrial equipment, office vehicles. The second group includes real estate objects: structures and buildings that create the initial conditions for the work of employees of the enterprise.

Account 08 08 and its purpose

We figured out the concept of non-current assets, but it remains unclear: why do we need a separate account for them if 01 and 04 have already been created? To understand the essence of the issue, let us recall the rules for accepting fixed assets and intangible assets for accounting.

According to the requirements of PBU, the accountant must reflect fixed assets and intangible assets on the account at their original cost, which includes all the actual costs of their acquisition. It often happens that information about all the amounts is not received immediately. This is where the need arises to open an account 08, which will collect data on items of expenditure for the acquisition of property. As soon as the accounting department takes into account all the amounts and the property is ready for commissioning, information can be written off to the main account 01 or 04.

Account structure

08 accounting account - active, because it collects information about the company's funds. All related costs of acquiring property are debited. When writing off, the amounts are shown in the credit of the account. At the end of the reporting month, a debit balance may form. As a rule, these are the amounts of expenses for facilities and fixed assets that have not been put into operation. If there is no balance, the account is closed.

The debit balance, if any, should be reflected in the financial statements. Account 08 in the balance sheet is included in line 1190, which characterizes the amount of other non-current assets.

Analytical accounting

To combine expenses of a similar nature into groups and systematize accounting, first-level sub-accounts are additionally opened, which reflect information on the costs of:

• 08.1 - acquisition of land plots;
• 08.2 - purchase of objects of nature management;
• 08.3 - construction of fixed assets;
• 08.4 - purchase of individual OS by category;
• 08.5 - acquisition of intangible assets;
• 08.6 - transfer of livestock from one herd to another;
• 08.7 - acquisition of adult cattle;
• 08.8 - implementation of scientific research, experiments, the results of which will be used in the future at the enterprise.

If necessary, other analytical accounts of a similar nature may be opened.

Receipt of non-current assets

Most often, a company acquires property through a contract of sale. In this case, the algorithm for taking it into account is clear: you need to collect all the expenses on account 08, and then write them off during commissioning to the main accounts. But there are other ways in which assets become the property of the enterprise. This is mainly the result of barter or a contribution to seed capital, and gratuitous receipts are not uncommon.

For each method of obtaining property, a method for registering 08 accounts and a method for calculating the initial cost are determined. When an act of donation is made, an appropriate contract is drawn up, which indicates the market value of the transferred objects. This will be the amount that should be reflected in the posting Dt 08 Kt 98 "Grants".

Investment in capital and transfer of goods for the needs of the enterprise

If one of the founders of the enterprise makes a contribution in the form of fixed assets or intangible assets, they should be taken into account based on the following rules:

1. Evaluation of incoming assets is to be carried out by agreement with the participants of the PA or AO. In this case, the value of the property should not exceed the market value.
2. After determining the amount of the initial cost, carry out account assignment Dt 08 Kt 75.

Thus, fixed assets from the founders were accepted for accounting on account 08. The information will be kept in debit until the property is taken into use.

Goods or finished products transferred within the enterprise to fulfill its needs are accounted for at actual cost, the amount of which can be found on accounts 41 or 43. The posting looks like this: Dt 08 Kt 43 (41).

barter agreement

The registration of property received after barter differs depending on the conditions for its implementation. So, if both parties recognize the objects of exchange as equivalent, then they do not assume any additional obligations. No additional payment is required, but what amount should be recorded on account 08 08 upon receipt of the asset? In this case, the market value of the property being retired for exchange acts as the initial price. If it is impossible to determine it, an indicator of the possible acquisition price of the incoming property is used.

After agreeing on the terms of a barter deal between enterprises, the acquired assets cannot yet be considered their property. The right to ownership passes after the fulfillment of obligations by each of the counterparties. Until this moment, the amounts are recorded on the off-balance account 002. After the fulfillment of all clauses of the contract and the receipt of property rights, the accountant writes off the amounts in Kt 002.

Further registration of the arrival is carried out according to the usual procedure for receiving fixed assets or intangible assets:

1. Dt 08 Kt 60 - the amount of incoming fixed assets is taken into account (the amount without VAT).
2. Dt 19 Kt 60 - reflected VAT on the acquired property.
3. Dt 01 Kt 08 - the object was put into operation and accepted for accounting.

Account 08 08: typical postings

Having studied the features of determining the initial cost of assets and their registration, consider the main account assignments:

08 accounting account for a loan reflects the amount of write-off of property when:

• putting it into operation;
• losses as a result of an emergency;
• shortages identified after the inventory;
• sale or liquidation.

Indicators of non-current assets mainly characterize the activities of the enterprise. The further organization of accounting for fixed assets and intangible assets depends on the correctness of the calculation of the initial cost of property. Account 08 was created to collect the necessary information about incoming assets in order to fully reflect all types of expenses for their acquisition.