The amount/ value at which an asset is recognized after deducting any accumulated depreciation (for physical assets) / amortization (for financial assets), and related, accumulated impairment losses, since it was acquired and recognized in the books of a business (firm). At the initial acquisition of an asset, the carrying value of that asset is equal to its original cost (cost at the time of purchase). Later on, this value will be adjusted for the effect of depreciation and impairment:
Carrying value= original value of asset – accumulated depreciation – impairment losses
An asset is said to be impaired if its carrying value exceeds its recoverable amount (which is, by definition, the higher of the fair value less costs to sell and the value in use).
For an asset, the carrying value appears in the statement of financial position at the end of the period: on the left side (asset side/ application of funds).
It is also known as book value of an asset.
