Investment Centre (Investment Center)
Accounting glossary · Understand, connect, apply
An investment centre is a segment whose manager has responsibility for earnings and the capital or assets used to earn them. Evaluation therefore considers resources employed as well as profit.
Example
Two divisions each earn 100,000. One uses operating assets of 500,000 and the other 1,000,000; their simple returns are 20% and 10% on the stated basis.
Remember the difference
Define both profit and the asset base consistently. A return measure can encourage managers to reject worthwhile investment, so review absolute value creation and longer-term objectives too.
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Published 4 November 2026. Prepared with AI assistance; examples are fictional and simplified for learning.
Examples are simplified for learning. Where a term depends on US law, IFRS, US GAAP or a historical rule, check the context explained above and the requirements relevant to your course.
Study references: OpenStax financial accounting and managerial accounting. For reporting requirements, consult the applicable IFRS Standards or FASB guidance. US tax terms should be checked against the relevant tax-year IRS instructions.
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