Dear expert, a company has paid die development charges (for die) to its job worker. the company has no control on such asset. if contract between job worker and company breaks, job worker is not entiteled to return the die. so my question is that, what would be the treatment of such die in the books of company. should it be capitalised or not. kindly help
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Treatment of asset
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I think you can apply the concept i.e factor to be considered while applying any A/cing policy: 'substance over form' to this issue.
As per the concept: Fact prevail over law.
So as per the agreement since J/W not entitled to return the asset, it won't be capitalised in the books.
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