The amount by which a fixed asset's accounting or book value is periodically reduced to reflect the fact that the economic value of the asset is steadily reduced by a combination of wear and tear from use, age, and/or obsolescence. The offsetting entry is depreciation expense. American Banker Glossary
A non-cash expense (also known as non-cash charge) that provides a source of free cash flows.. Amount allocated during the period to amortize the cost of acquiring long-term assets over the useful life of the assets. To be clear, this is an accounting expense not a real expense that demands cash. The sum of depreciation expenses of prior years leads to the balance sheet item Accumulated Depreciation. Bloomberg Financial Dictionary
Decline in the value of one currency relative to another. Occurs when, because of a change in exchange rates, a unit of one currency buys fewer units of another currency. Chicago Mercantile Exchange Glossary
Amounts charged to the profit and loss account to reflect the wearing out of a fixed asset over its useful life. For example, if a company buys a car for £10,000 with an expected useful life of four years, it will charge the £10,000 cost to profit and loss account over a four year period. The simplest way to do this is to charge £2,500 expense per year ( straight line depreciation). The purpose of depreciation is to comply with the accruals concept. Since the benefit of the car is received over a four year period, the cost of acquiring the car is charged against profits over a four year period. Dresdner Kleinwort Wasserstein financial glossary
The reduction in the book or market value of an asset. Exchange Handbook Glossary
Accounting procedure that spreads the cost of an asset over the life time of the asset. Financial Services Glossary

* * *

US /dɪˌpriːʃiˈeɪʃən/ noun [U]
ACCOUNTING, TAX the amount by which something, such as a piece of equipment, is reduced in value in a company's financial accounts, over the period of time it has been in use. The loss in value reduces a company's profits, and the amount of tax it must pay: »

accelerated depreciation


Expenses include depreciation of equipment as well as business insurance.


a depreciation charge/deduction

Compare AMORTIZATION(Cf. ↑amortization)
ACCOUNTING the practice of spreading the cost of capital expenditure over several years, especially in order to improve cash flow
MONEY, FINANCE the amount by which a currency loses value in comparison with other currencies: »

The depreciation of the dollar affected the British economy.


the depreciation of sterling against the euro


Depreciation in the peso since last December could dent sales and cut profit.

Compare APPRECIATION(Cf. ↑appreciation)
FINANCE, INSURANCE a loss of value, especially over time: »

After three years, this car is projected to be worth 57% of its price when new - one of the lowest rates of depreciation of any car in any class.


The insurance guarantees that the goods will be replaced at their present market value, without any deduction for depreciation.

Compare APPRECIATION(Cf. ↑appreciation), WEAR AND TEAR(Cf. ↑wear and tear)
See also ACCELERATED DEPRECIATION(Cf. ↑accelerated depreciation), ACCUMULATED DEPRECIATION(Cf. ↑accumulated depreciation), BOOK DEPRECIATION(Cf. ↑book depreciation), TAX DEPRECIATION(Cf. ↑tax depreciation)

Financial and business terms. 2012.

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Look at other dictionaries:

  • dépréciation — [ depresjasjɔ̃ ] n. f. • 1771; de déprécier ♦ Action de déprécier, de se déprécier; état de ce qui est déprécié. Dépréciation des marchandises, de l or, de l argent. ⇒ avilissement, baisse, décote, dévalorisation. L inflation entraîne la… …   Encyclopédie Universelle

  • Depreciation — Dépréciation En économie, une dépréciation est une perte de valeur d un bien, ou plus généralement d une monnaie. En comptabilité générale, une dépréciation est la constatation comptable d une moins value probable sur un élément d actif. Sommaire …   Wikipédia en Français

  • depreciation — de·pre·ci·a·tion /di ˌprē shē ā shən/ n 1: any decrease in the value of property (as machinery) for the purpose of taxation that cannot be offset by current repairs and is carried on company books as a yearly charge amortizing the original cost… …   Law dictionary

  • Depreciation — De*pre ci*a tion (d[ e]*pr[=e] sh[i^]*[=a] sh[u^]n), n. [Cf. F. d[ e]pr[ e]ciation.] 1. The act of lessening, or seeking to lessen, price, value, or reputation. [1913 Webster] 2. The falling of value; reduction of worth. Burke. [1913 Webster] 3.… …   The Collaborative International Dictionary of English

  • DEPRECIATION — Снижение стоимости обесценивание валюты, вызванное действием рыночных механизмов и не связанное с действиями государственных организаций Словарь бизнес терминов. Академик.ру. 2001 …   Словарь бизнес-терминов

  • depreciation — 1767, a lowering of value (originally of currency), noun of action from DEPRECIATE (Cf. depreciate). Meaning loss of value of a durable good by age or wear is from 1900 …   Etymology dictionary

  • depreciation — [n] devaluation accounting allowance, deflation, fall, loss of value, reduction, slump; concepts 137,236,240,247 …   New thesaurus

  • depreciation — [dē prē΄shē ā′shən, diprē΄shē ā′shən] n. [see DEPRECIATE ] ☆ 1. a) a decrease in value of property through wear, deterioration, or obsolescence b) the allowance made for this in bookkeeping, accounting, etc. ☆ 2. a decrease in the purchasing… …   English World dictionary

  • Depreciation — Not to be confused with Deprecation. Depreciation refers to two very different but related concepts: the decrease in value of assets (fair value depreciation), and the allocation of the cost of assets to periods in which the assets are used… …   Wikipedia

  • depreciation — /dapriyshiyeyshsn/ In accounting, spreading out the cost of a capital asset over its estimated useful life. Depreciation expense reduces the taxable income of an entity but does not reduce the cash. A decline in value of property caused by wear… …   Black's law dictionary

  • depreciation — /dapriyshiyeyshsn/ In accounting, spreading out the cost of a capital asset over its estimated useful life. Depreciation expense reduces the taxable income of an entity but does not reduce the cash. A decline in value of property caused by wear… …   Black's law dictionary

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