Capitalization of costs: borrowing and delay-related expenses cannot be capitalized; part capitalization allowed when a unit is ready. Clarification states that under AS 10 and AS 16, only expenditures that increase the worth of fixed assets may be capitalized; costs, including borrowing costs, incurred during an extended delay after a plant is otherwise ready for commercial production must not be capitalized. AS 16 allows part capitalization where a unit is ready and capable of use while other units remain under construction. These rules apply to both cost-plus and competitive-bid power projects.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Capitalization of costs: borrowing and delay-related expenses cannot be capitalized; part capitalization allowed when a unit is ready.
Clarification states that under AS 10 and AS 16, only expenditures that increase the worth of fixed assets may be capitalized; costs, including borrowing costs, incurred during an extended delay after a plant is otherwise ready for commercial production must not be capitalized. AS 16 allows part capitalization where a unit is ready and capable of use while other units remain under construction. These rules apply to both cost-plus and competitive-bid power projects.
Full Summary is available for active users!
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
of 
Join Channel
TaxTMI 
