Dears,
Company taken building premises for lease from out side party. Company has done interior decoration for partion in the office.Client expensed off the cost for interior decoration not capitalized the same is it a correct practice or it should be capitalized?
Please give me your answer as early as possible becz i am in hurry to finish the audit.
Should be capitalise under the head Furniture & fixture
It depends upon the agreement of building. if the agreement is for more than a year then decoration expenses should be capitalized. or if the agreement is of one year but the circumstances suggest that the same shall be renewed; even then the decoration expenses shall be capitalized. In case the agreement is for one year and it is not probable to get the agreement renewed after expiry, then such decoration expenses shall be expensed out.
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