The statement of profit or loss
. Depreciation = allocation not valuation

. Depreciation measures the loss in value of each non-current asset during each accounting period.

. Depreciation is a way to build up a fund for the replacement of non-current assets at the end of their useful lives.

. Depreciation is a means of applying the accruals basis of accounting by allocating the cost of a non-current asset to the periods benefiting from its use.