Gross PP&E (Property, Plant & Equipment)

Category

Balance Sheet

Units

Currency

US-GAAP elements

PropertyPlantAndEquipmentGross

Reference

Regulation S-X Rule 5-02.13 (Property, plant and equipment); ASC 360

Source

Reported in SEC EDGAR filings (US-GAAP XBRL taxonomy)

Property, plant and equipment (gross), or gross PP&E, is the total original cost of the physical, long-lived assets a company uses to run its business, before subtracting accumulated depreciation. It includes land, buildings, machinery, equipment, vehicles, furniture, computer hardware, leasehold improvements, and construction in progress, all measured at what the company paid to acquire or build them.

Assets held for resale are not included; those are inventory. Gross PP&E minus accumulated depreciation equals net PP&E, the carrying value reported on most balance sheets.

Regulation S-X Rule 5-02.13 requires companies to show property, plant and equipment and to state the basis used to measure it, which for most companies is historical cost. Rule 5-02.14 requires the related accumulated depreciation, depletion, and amortization to be shown separately, on the balance sheet or in a note. That is why the gross figure is usually available even when only the net amount appears on the face of the statement. In XBRL it is tagged PropertyPlantAndEquipmentGross.

Cost includes everything needed to get an asset ready for use, such as delivery, installation, and, for assets a company builds itself, certain interest during construction. Under ASC 360, assets stay at cost and are not revalued upward. Impairment write-downs, retirements, and sales reduce the gross balance, and the gross figure also shifts when companies reclassify assets as held for sale. Some filers include finance lease right-of-use assets in PP&E, while others present them separately, which affects comparisons.

Gross PP&E is most useful next to accumulated depreciation. The ratio of accumulated depreciation to gross PP&E gives a rough sense of how old a company's asset base is, and dividing gross PP&E by annual depreciation expense approximates average useful life. Comparing growth in gross PP&E with capital expenditures also shows how much of the company's spending is expanding the asset base rather than replacing retirements.