Mastering depreciation webinar materials
The materials from this session.
Why depreciation can make or break a model
Depreciation can look like a simple accounting concept, but in project finance it has a large effect on the accuracy of the model. This recorded webinar explains the differences between accounting depreciation and tax depreciation, from the straight line and reducing balance methods to tax-specific approaches such as capital allowances in the UK and MACRS in the US.
It shows how each method works and why it matters, and how depreciation errors can distort the balance sheet, tax, debt sizing and investor returns.
What you will learn
- The role of depreciation in the financial statements and in tax computations
- The differences between accounting depreciation and tax depreciation: their meaning, use and accounting treatment
- The common modelling errors in depreciation workings
For a written guide, see our article Depreciation in financial models.