Gross Book Value is a crucial accounting term that refers to how the value of an asset is initially recorded in an entity's financial accounts. This value is determined at the time of acquisition and represents the original cost of the asset. For example, if a company purchases a building for $500,000, this amount is recorded as the building's Gross Book Value.

An important aspect of Gross Book Value is that it does not factor in any subsequent adjustments or reductions to the asset's value, such as depreciation for tangible fixed assets or amortization for intangible assets. Over time, these processes decrease the net book value of the asset to reflect its usage, aging, or obsolescence.

The Gross Book Value can be used when analyzing the financial statements to understand the total original cost value of all assets owned by the entity, before reductions for accumulated adjustments. For instance, a balance sheet might display both Gross and Net Book Values for assets to differentiate between their original purchase costs and their current accounting valuations.