Depreciation Treatment on assets received in kind for specific purpose (Corpus donation)

[PRIYAM KHAMBHATA]

Respected Sir

Whether depreciation on assets received in kind for specific purpose would be adjusted against the respective Donation Fund - corpus fund, instead of being charged to the Income & Expenditure Account,

Please guide me, what would be corrected for accounting standards.

Thanking

AI Summary

Depreciation on donated assets should be charged to income and expenditure, not automatically adjusted against corpus funds.
Depreciation on an asset received in kind through a corpus or specific-purpose donation should ordinarily be charged to the Income & Expenditure Account, with accumulated depreciation reducing the asset's carrying value. The corpus or specific-purpose fund should remain separately presented according to donor terms and accounting policy. Direct adjustment of depreciation against that fund is appropriate only where donor restrictions, governing terms and the applicable accounting framework specifically permit it. Tax restrictions on depreciation as application of income remain distinct from book accounting treatment.