IFRS-US GAAP-VUK Depreciation Calculation
Compare depreciation amounts under IFRS, US GAAP and VUK standards.
General Information
⚠️ Residual value is not considered in VUK
IMPORTANT: You can find all details and information at the bottom of the page before filling in the information
VUK (For Turkey)
ℹ️ In balance sheet method: Both methods can be selected
⚠️ In simple accounting: Usually only Normal depreciation is applied (Declining Balance is limited)
IFRS Parameters
💡 Should be reviewed annually
💡 Business selects based on economic benefit
US GAAP Parameters
💡 Consistent application required
VUK
Turkish Tax Legislation
Annual Depreciation
IFRS
International Standards
Annual Depreciation
US GAAP
US Accounting Standards
Annual Depreciation
Key Differences and Explanations
VUK
- • Fixed rates are used (Revenue Administration list)
- • Residual value is not considered
- • Full cost basis is amortized
- • Normal and declining balance methods
- • Mandatory according to tax legislation
- • Inflation adjustment removed (end of 2025)
- • Full year basis except passenger cars
IFRS (International)
- • Useful life is business estimate
- • Residual value is deducted (annually revised)
- • 3 methods: Straight-Line, Declining, Production
- • Day/month based calculation
- • Component depreciation mandatory
- • Revaluation can be done
US GAAP (USA)
- • Useful life is business estimate
- • Residual value is deducted
- • Similar methods to IFRS
- • Day/month based calculation
- • Component depreciation optional
- • Revaluation prohibited
Important Concepts and Differences
1. Useful Life and Depreciation Rate Relationship
VUK: Depreciation rate is NOT selectable - useful life is determined by Revenue Administration. Example: 20% rate = 5 years useful life (mandatory). IFRS/US GAAP: 5 years is an estimate - business determines it and reviews annually. Tax vs Financial Reporting: VUK = fixed rules for tax planning | IFRS/US GAAP = reflect actual economic benefit
2. Residual/Scrap Value
Estimated value at which the asset can be sold at the end of its useful life. Example: A machine worth 100,000 TL can be sold as scrap for 10,000 TL after 5 years. VUK: There is NO residual value - depreciation is calculated on full cost. IFRS/US GAAP: Residual value is reviewed annually. If estimate changes, depreciation is revised prospectively, past is not corrected. This means: IFRS/US GAAP ≠ "calculate once, forget" | VUK ≈ "rate is fixed, continue"
3. Depreciation Start Time and Partial Year Depreciation
VUK: Full year basis applies except passenger cars (even if purchased on the last day of the year, full year depreciation). Partial year depreciation (monthly calculation) is mandatory for passenger cars. IFRS: Depreciation begins when the asset is ready for use (invoice date or capitalization date is not required). Day/month based usage is essential. Depreciation is stopped for assets held for sale (IFRS 5). US GAAP: Similar to IFRS, day/month based usage is valid. In large investments, this difference significantly affects profit amount
4. Component Depreciation
IFRS: Aircraft engines (15 years), fuselage (25 years), interior (10 years) are depreciated SEPARATELY - MANDATORY. US GAAP: Entire aircraft can be depreciated as a single asset - optional. Effect: Component depreciation increases depreciation expense in early years (due to short-lived components) → Early years: lower profit | Later years: higher profit
5. Revaluation and Inflation Adjustment
IFRS: Assets can be increased to fair value (Revaluation Model). Revaluation difference is not written directly to profit, tracked in equity as "Revaluation Surplus Fund". Revaluation increase is netted with impairment (IAS 16). If there was previous impairment, it is compensated first. Advantage: Balance sheet reflects real value, borrowing capacity increases. Disadvantage: Depreciation expense increases → indirectly reduces profit. US GAAP: Revaluation PROHIBITED - only historical cost. VUK: Inflation Adjustment application has been removed as of end of 2025. However, exceptional applications can be made with temporary legal regulations (such as 2021-2023 revaluation). Key Difference: IFRS = continuous option as accounting policy | VUK = limited to temporary legal regulations
6. US GAAP - Practical Reality
Although US GAAP is theoretically close to IFRS, in practice there are these differences: Fewer methods are used (mostly straight-line), more conservative estimates are made, policy changes are especially avoided. This explains why the emphasis on "consistency" is so strong.