What is a Non-Current Asset?

A non-current asset is an asset on the balance sheet that is not expected to convert into unrestricted cash within a year’s time.

Non-current assets may include such things as intellectual property and production/operations equipment - meaning they likely do not have a need to convert to cash.

From a balance sheet standpoint, non-current assets are capitalized rather than expensed - meaning the company can allocate the asset’s cost of the asset over the number of years for which the asset will be used, instead of allocating it all in the year it was purchased.

Depending on the type of asset, it may be depreciated, amortized or depleted. Non-current assets are classified on the balance sheet under one of the following headings: investments, property, plant and equipment, intangible assets or other assets.