I bought a laptop for AED 2,000 — asset or expense?

The accounting rule is that any purchase with a useful life beyond a year and future economic benefit should be capitalised as a fixed asset and depreciated over its life, not expensed in full in the year of purchase. In practice, companies set an internal capitalisation threshold — anything below it is expensed directly to save effort, even if technically it's an asset.

The issue isn't picking the threshold — it's changing it every year on a whim, which breaks consistency in the financials and draws an auditor's attention. RASEEKH helps you set a fixed capitalisation policy that fits your company's size, applied with the same logic every year.