Below are the criteria for recognizing a fixed asset according to the applicable accounting regulations, the elements that differentiate it from an inventory object, as well as the provisions relating to evaluation, depreciation and decommissioning.
Summary:
- A fixed asset must simultaneously meet the criteria for a duration of use of more than 12 months and a minimum value of 2,500 lei, being registered as an immobilized asset and subject to depreciation according to the Catalog of fixed assets.
- The classification and coding of fixed assets determines the normal duration of operation and the applicable tax treatment, and the 2025 updates include new subgroups and duration adjustments for certain assets.
- The correct management involves the record in the register of fixed assets, inventory and periodic evaluation, the application of approved depreciation methods, as well as documented procedures for scrapping and selling, in accordance with the fiscal-accounting legislation.
What are fixed assets?
Fixed assets represent tangible assets held by the entity for the purpose of use in the production process, the provision of services, the lease to third parties or for administrative activities, for a period exceeding the duration of a financial year.
According to the accounting and fiscal regulations, in order to be recognized as a fixed asset, a good must cumulatively meet the following conditions:
- normal duration of use of more than one year;
- entry value equal to or higher than the minimum ceiling provided by the tax legislation in force;
- exclusive use for the purpose of carrying out economic activities;
- not intended for resale in the normal course of activity.
In accounting, fixed assets are registered in the category of tangible fixed assets from the patrimonial balance sheet, at the entry value determined according to the method of purchase (purchase cost, production cost or value established by expertise). During the useful life, they are subject to the depreciation process, by the method and for the duration established according to the catalog of fixed assets and approved accounting policies.
The defining characteristic of fixed assets is durability, associated with the ability to generate future economic benefits in the long term. Effective administration involves periodic inventory, revaluation, adjustment for impairment, as well as decommissioning through scrapping, selling or other methods permitted by law.
The legal regime, the recognition criteria and the methods of calculating depreciation are regulated in art. 28 of the Fiscal Code (Law no. 227/2015) and in subsequent normative acts.
Classification of fixed assets
The system of classification of fixed assets in Romania is regulated by the Catalog regarding the classification and normal operating periods of fixed assets, a normative act that establishes groups, subgroups and classes of assets, as well as the standard amortization periods related to each category. Correct framing has direct implications on the calculation of depreciation and tax treatment:
1. Constructions
This group includes fixed immovable assets intended for use as functional buildings or infrastructure works. It is characterized by high input values and long service life, which implies depreciation over extended periods. Relevant examples: industrial halls, storage spaces, administrative and commercial buildings, treatment plants, roads, bridges, technical-building networks and other similar works.
2. Means of transport, technical installations, animals and plantations
This group brings together tangible assets with high mobility and depreciation times, generally shorter than in construction. Means of transport include cars, vans, trucks, buses, motorcycles and other vehicles used for economic purposes. The technical installations cover specialized equipment and machinery necessary for technological processes, such as industrial air conditioning devices, production lines and processing equipment. This includes working or breeding animals and plantations with a multiannual production cycle.
3. Furniture, office equipment and means of protection
This class includes assets with a lower acquisition value, but which meet the recognition criteria as fixed assets and are subject to the depreciation process. Here are some examples: office furniture, office equipment, household appliances used in economic activity, video surveillance systems, mechanical safety devices and personal protective equipment.
How is the classification code applied and what changes does the new catalog of fixed assets bring in 2025?
The fixed asset coding system is structured on the basis of a hierarchical numbering, intended to ensure the unitary and rapid identification of the group and subgroup of which each asset is a part. The classification code is binding in the accounting records, being used both for the recognition and registration of tangible assets, as well as for the appropriate application of the tax treatment.
The code structure is as follows:
- Group 1 – Construction: codes starting with the number ‘1’, related to buildings and infrastructure works, with normal long use duration;
- Group 2 – means of transport, technical installations, animals and plantations: codes starting with the number ‘2’, related to assets with high mobility and generally lower amortization periods;
- Group 3 – Furniture, office equipment and means of protection: codes starting with the number ‘3’, related to administrative and logistical support assets, with lower input value compared to previous groups.
The Fixed Asset Catalog – 2025 edition introduces significant changes in the classification structure, through:
- the inclusion of new subgroups for digital equipment and emerging technologies;
- adjusting the normal operating times for certain assets, in accordance with the accelerated pace of technological wear;
- Clarification of codes related to certain asset categories for the elimination of non-unitary interpretations.
Therefore, the application of the new version of the Catalog requires the updating of the immobilization registers and the internal record procedures, as well as the training of the specialized staff from the financial-accounting departments.
Value of fixed assets in 2025
The value threshold used for the recognition of fixed assets is one of the essential criteria for accounting and tax classification. According to the regulations in force, the minimum entry value for the inclusion of an asset in this category remains, in 2025, by 2,500 lei. Maintaining the same level provides stability to accounting policies and allows continuity in investment planning.
The determination of the threshold is made by referring to the value of entry into the heritage, which is not limited to the purchase price, but includes all the costs necessary to put the asset into operation at the location and under the conditions provided for by its destination. Thus, among other things, non-recoverable taxes, transport, assembly, installation and preliminary tests are taken into account.
Assets that exceed this threshold benefit from the fiscal treatment applicable to fixed assets, respectively depreciation during the normal operating period established according to the catalog of fixed assets. Through amortization, the cost of the investment is distributed over the entire period of use, which allows a more efficient management of the impact on the annual tax result.
The difference between fixed assets and inventory items
In the sense of the applicable accounting regulations, the delimitation between fixed assets and inventory items is a determining element for establishing the accounting and fiscal treatment of the assets owned by the entity.
The differentiation criteria are as follows:
a) The criterion regarding the normal duration of use
- Goods with a useful life of less than 12 months are classified as inventory items, regardless of the entry value;
- Goods with a useful life of more than 12 months and fulfilling the value threshold provided for in letter b) are classified as depreciable fixed assets.
b) the value criterion
- The value threshold for the recognition of a fixed asset is set at 2,500 lei;
- The goods with entry value below this threshold are classified as inventory items, being fully recognized by expenses in the financial year of the purchase;
- Goods that exceed the threshold and meet the condition of normal duration of use are subject to the depreciation regime provided for by the Catalog of fixed assets.
c) Accounting and fiscal treatment
- Inventory items are highlighted in accounting as current assets and are fully transferred to expenses at the time of commissioning, directly influencing the result of the year in the year of acquisition;
- Fixed assets are registered in the category of tangible fixed assets and are systematically amortized over the useful life, the cost being proportionally distributed over several financial years.
Establishing the correct classification is mandatory to ensure compliance with the tax legislation, influencing the calculation method of depreciation, the deductibility of expenses and the taxable result. At the same time, the choice between the purchase of inventory items or fixed assets must be based on the entity’s accounting policy, investment objectives and short- and long-term financial strategy.
Calculation methods for depreciation of fixed assets
The depreciation of fixed assets represents the accounting procedure for the systematic distribution of the input value of a tangible asset during the normal duration of operation, established according to the Catalog on the classification and normal durations of operation of the fixed assets. The purpose of amortization is to recognize physical wear, moral depreciation and other factors that diminish the asset’s ability to generate future economic benefits.
The depreciation method is established by the approved accounting policies of the entity and is applied for the entire duration of the asset’s use, in compliance with the applicable fiscal and accounting provisions.
Allowed depreciation methods are:
- The linear method – the uniform distribution of the depreciable value for the entire duration of use;
- The degressive method – the application of higher depreciation quotas in the first years of operation, subsequently reduced;
- The progressive method – the application of increasing depreciation quotas during the duration of use;
- Accelerated method – the deduction, in the first year of use, of up to 50% of the input value, the difference being depreciated linearly for the remaining period.
Normal operating times, expressed in years, are fiscally mandatory. In the accounting records, shorter durations can be used if they more accurately reflect the consumption of economic benefits.
The depreciable value is determined as the difference between the input value and the estimated residual value of the asset. The recording of depreciation in the accounting is carried out monthly, by debiting the depreciation expense accounts and crediting the cumulative depreciation accounts, in accordance with the approved depreciation plan.
Management and record of fixed assets
The management of fixed assets is carried out through a set of procedures and instruments that ensure complete records, control and compliance with the applicable accounting and fiscal regulations.
As mentioned, the Fixed Assets Register is the mandatory document for tracking each individual asset. It contains the identification data, the technical characteristics, the input value, the normal operating time and the depreciation method, according to the Catalog on the classification and the normal operating times of the fixed assets.
The management steps are as follows:
- Initial record – involves the identification of the asset, the evaluation according to the recognition criteria, the establishment of the classification code and the registration in the accounting based on the supporting documents (purchase invoice, reception minutes). The entry value includes the cost of purchase or production, as well as the accessory expenses necessary to bring it to a state of use.
- Accounting – it is carried out using the accounts of class 2 ‘Immobilization’, depending on the nature of the asset (eg: 212 – construction, 213 – technical installations and cars, 214 – furniture, 215 – real estate investments). The choice of account is made according to the general chart of accounts and the approved accounting policies.
- Periodic inventory – is done at least once a year and involves:
- verification of the physical existence of the asset;
- technical status assessment;
- Comparing the information with the data in the register of fixed assets and correcting any inconsistencies.
- periodic evaluation – it is carried out for updating the accounting value and adjusting the depreciation plan according to wear, revaluation or depreciation. In justified cases, the useful life can be recalculated or adjustments for loss of value can be registered.
- Internal control – involves periodic checks to confirm the agreement between the accounting records and the reality on the ground. These checks can be carried out through physical inventories and functionality tests.
Examples of IT solutions supporting the compliant management of fixed assets:
- Location and taxation solutions for Romania allow the integration of specific local legislation functions into ERP systems;
- SAF-T module Facilitates the generation and transmission of the standard fiscal control file, according to ANAF requirements;
- Module E-invoice It is effective for issuing and transmitting electronic invoices in the format accepted by the national system;
- Check management module It simplifies the management of operations with CEC payment instruments, recorded in accounting according to legal norms.
Overall, the implementation of such systems allows the automation of record and control processes, reduction of errors and compliance with tax and accounting obligations.
Removal and sale of fixed assets
The scrapping of fixed assets constitutes the operation by which an immobilized asset is definitively taken out of operation and from the accounting records of the entity, as a result of the impossibility of using it under justified economic or technical conditions and the lack of future economic benefits.
The scrapping procedure is carried out as follows:
- drawing up the report of the technical condition, which attests to the irreversible depreciation of the asset and the reasons for decommissioning; The document will contain the description of the asset, the date of commissioning, the duration of use, the entry value, the accumulated depreciation and the remaining value;
- elaboration of the substantiation note for scrapping, justified from an economic and technical point of view;
- Presentation of the documentation (minutes and substantiation note) to the competent management body, for the approval of the scrapping according to internal procedures;
- carrying out disassembly operations and, as the case may be, capitalizing on recoverable components through internal reuse or sale;
- drawing up the minutes of decommissioning, supporting document for the accounting registration of the operation.
Alienation by sale of a fixed asset is carried out in compliance with the following requirements:
- establishing the sale price according to the market value, taking into account the legal provisions regarding transactions between affiliated persons;
- drawing up supporting documents (sale-purchase contract, invoice);
- accounting records, which include:
- removing from the record the input value and the accumulated depreciation;
- recognition of sales income;
- Determination of the result from the disposal (profit or loss) as the difference between the sale price and the net book value, a result that directly influences the basis for calculating the profit tax.
Last but not least, the application of the procedure is carried out in compliance with the accounting and fiscal regulations in force, the related documentation being kept according to the legal deadlines to justify the operation before the control bodies.
In conclusion, the management of fixed assets requires the unitary application of the legal provisions regarding the recognition, evaluation, depreciation and decommissioning, the use of classification codes according to the Catalog of Fixed Assets, the maintenance of related operational and accounting records and the preparation of complete supporting documentation, to ensure compliance fiscal and faithful presentation in the financial statements.
