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Frameworks

2.6 Non-financial assets

The definition of a financial asset is covered in detail in Chapter 11. Common
financial assets include trade receivables, investments in debt instruments and
investments in shares.

Common non-financial assets include:

 Property, plant and equipment

 Intangible assets.

The fair value of a non-financial asset should be based on its highest
and best use.

The highest and best use of an asset is the use that a market participant would adopt
in order to maximise its value.

This use need not be legally approved, although it must not be legally prohibited.

Illustrations and further practice

You can now try TYU 4 from Chapter 1

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