Repair, reconstruction and modernization of fixed assets: how to reflect expenses

To begin with, we need to understand what OS repair, reconstruction and modernization includes.

Companies, as a rule, carry out three types of repairs: current, medium and capital. This classification is based on the dependence on the volume and frequency of work performed.

During the current repair, equipment breakdowns are carried out. Therefore, current repairs are carried out in order to protect fixed assets from premature physical wear and tear. Such repairs are carried out systematically, for example once a quarter.

Unlike current repairs, average repairs are carried out once a year. At the same time, some of the main parts are replaced in the repaired object. But the goal of a medium repair is still the same - to prevent potential breakdowns.

But the overhaul involves the replacement of worn parts with new ones. For example, if a machine is overhauled, then its body is repaired, the power unit is completely disassembled, and then all worn parts and assemblies are replaced with new and more modern ones. And during the overhaul of the building, all its worn-out structures are replaced by more durable and economical ones. The exception is stone and concrete foundations, as well as other basic structures. The frequency of major repairs depends on the intensity of operation of fixed assets. But most often major repairs are carried out once every few years.

Tax accounting of expenses

The Tax Code of the Russian Federation allows accounting for funds spent on current, medium and major repairs as part of other expenses associated with production and sales. You can write off repair expenses in the quarter in which this repair was made (clause 1, article 260 of the Tax Code of the Russian Federation).

Let's name the arguments that help the inspectors to convince the judges that the organization has upgraded or reconstructed the fixed asset, and the counterarguments proving that the funds were spent on repairs.

Signs of renovation work. The definition of repair in the Tax Code of the Russian Federation is not given. Therefore, in the event of disputes, inspectors and judges use the definitions of repair that are given in various industry regulations. The document is selected depending on the type of repaired object. For example, when repairing buildings, they use Departmental building codes VSN 58-88 (p) "Regulations on the organization and conduct of reconstruction, repair and Maintenance buildings, objects of communal and socio-cultural purposes”, approved by the order of the State Committee for Architecture of Russia under the USSR State Construction Committee dated November 23, 1988 No. 312.

The most general definitions of current, medium and major repairs are given at the beginning of this chapter. The main feature inherent in all types of repairs is as follows. During the repair, the purpose of the facility does not change, product quality does not improve, and production areas and capacities do not increase. Repair only allows you to avoid failures and malfunctions in the operation of the fixed asset.

In most cases, the courts agree that the fixed asset has undergone repairs, and not modernization, reconstruction or technological re-equipment. The following arguments help to win in court.

The simplest of these is: primary documents neither modernization nor reconstruction is mentioned. This shows that the repairs performed can be classified as repairs.

The argument is, of course, formal. But sometimes companies manage to convince judges that the fixed asset was being repaired, only because all the work done on paper was called repair, and not reconstruction or modernization. By at least this serves as a good supporting argument (see, for example, Decree of the Federal Antimonopoly Service of the West Siberian District of December 14, 2005 No. F04-8972/2005 (17854-A46-33)).

Industry experts can be a good help in court. regulations. If the judges, having analyzed the industry instruction, see that the work performed by the enterprise fully falls under the concept of “repair” given there, the dispute can be considered won. Here are two examples: the resolution of the FAS of the East Siberian District of June 6, 2005 No. A19-3369 / 04-24-F02-2450 / 05-S1 and the resolution of the FAS of the Volga-Vyatka District of July 1, 2005 No. A29-5503 / 2004a.

Of course, inspectors can also refer to industry regulations confirming that the work performed is an upgrade or renovation. In this case, it can be stated that such papers have nothing to do with tax legislation. It is possible that the judges will really ignore the documents submitted by the inspectors (see the decision of the Federal Antimonopoly Service of the North-Western District of July 7, 2005 No. A56-4658 / 05).

An independent expert can confirm that the object has been repaired and not modernized. It is possible to demand an examination of the work performed directly in court. If the expert confirms that the work, in fact, is a repair, the court will support the taxpayer (see, for example, the resolution of the Federal Antimonopoly Service of the Volga District dated May 19, 2005 No. A55-14520 / 04-22).

In addition to the expert opinion, you can also bring to court a letter from public institution, which supervise the repair or capital work in the industry. Of course, in such a letter it should be said that the controversial work is considered a repair, and not modernization or reconstruction (see the resolution of the Federal Antimonopoly Service of the North-Western District of May 29, 2006 No. A13-4630 / 2005-05).

Inspectors also often resort to the services of experts. But the case cannot be considered lost, even if the expert invited by the tax authorities concluded that the company did not carry out repairs, but reconstruction. Thus, in the decision of the Federal Antimonopoly Service of the West Siberian District dated February 27, 2006 No. F04-675 / 2006 (20077-A46-33) (the text of the document is on page 109), the judges did not take into account the expert opinion made at the request of the inspectors. The reason for this was that the expert studied only the architectural and planning task. And the court decided that it was impossible to conclude from this document whether the building was being repaired or reconstructed.

You can also try to convince the judges that after the repair, the purpose of the fixed asset has not changed. This is an effective argument against accusations of hidden modernization, since it implies, among other things, the acquisition of a new purpose by the object, that is, a change in essence. It is obvious that the essence of the object remains the same if the broken part is changed to a similar one (see resolution of the Federal Antimonopoly Service of the Volga District dated January 18, 2005 No. A57-11449 / 03-7). And even if the new parts are significantly superior in their characteristics to their predecessors. Most often, this situation occurs when repairing computers. After all, manufacturers of computer components quite often improve their products. And as a result, when repairing a computer bought, say, two years ago, you have to install a processor or a new generation hard drive on it. After all, their predecessors have already been discontinued and it is very difficult to buy them. But after all, from the fact that the memory capacity or the speed of the computer increases, its purpose does not change. And the courts agree that in such cases it is not about modernization, but about repair (see, for example, the decision of the Federal Antimonopoly Service of the Urals District of June 7, 2006 No. Ф09-4680 / 06-С7).

In fairness, it must be said that, according to officials from the replacement of the monitor, which did not lead to a change in its functional purpose, is considered a repair (see letter of the Ministry of Finance of Russia dated October 9, 2006 No. 03-03-04 / 4/156). Naturally, the logic that allows us to consider the replacement of parts of a fixed asset with more advanced ones as a repair, and not an upgrade, is applicable not only to computers. In the same way, the courts agree to consider as a repair the replacement of individual components of the machine (see the decision of the Federal Antimonopoly Service of the North-Western District of April 17, 2006 No. A66-10560 / 2005) and the tractor (see the decision of the Federal Antimonopoly Service of the Urals District of November 29, 2005 No. F09 -5358/05-C2).

In addition, companies manage to prove in court that the purpose and quality characteristics of the object do not change as a result of finishing the premises with modern materials and air ducts in them (see Resolution of the Federal Antimonopoly Service of the North-Western District of September 28, 2005 No. A52-1224 / 2005 / 2 ), equipment of rest rooms in the production building with showers and bathrooms (see FAS resolution North Caucasus District dated August 8, 2006 No. F08-3482 / 2006-1499A), strengthening the main load-bearing structures of the building (see Resolution of the Federal Antimonopoly Service of the Central District dated September 8, 2005 No. A08-5999 / 04-20).

Please note: when renovating buildings and other real estate, it is important to prove that the work performed did not increase the production area. After all, the increase in such areas is one of the signs of reconstruction. It is possible to convince the inspectors, and, if necessary, the judges, that the area of ​​the building has not increased after the repair, by comparing the number square meters repaired area, which is indicated in the act with the contractor, with the total area of ​​​​the building, prescribed in its technical passport. Of course, the first value must be less than or equal to the second (see the resolution of the Federal Antimonopoly Service of the West Siberian District of August 1, 2005 No. F04-4943 / 2005 (13542-A45-33)).

Sometimes a company simultaneously repairs and modernizes or reconstructs the same object, say, a conveyor line or a building. Then it is important to ensure separate accounting for the costs of repairs and modernization. Otherwise, the inspectors recognize all the funds spent as expenses for modernization. And separate accounting will make it possible to write off at least part of the funds spent for repair costs (see the resolution of the Federal Antimonopoly Service of the West Siberian District of February 27, 2006 No. F04-675 / 2006 (20077-A46-33)).

Signs of reconstruction, modernization and technical re-equipment

Definitions of modernization and reconstruction are in Article 257 of the Tax Code of the Russian Federation. It follows from this article that all the consequences that are not inherent in repair, which are mentioned above, are just the result of modernization or reconstruction. For example, during modernization, work is carried out aimed at changing the technological or service purpose of a fixed asset. And the reconstruction leads to an improvement in the quality of products, a change in its range, as well as an increase in production capacity.

Technological re-equipment entails the most significant changes. This concept includes a whole range of activities, which, among other things, include modernization work.

The inspectors manage to prove that the company did not carry out repairs, but modernization or reconstruction using the following arguments.

One of the most powerful arguments is that contracts with contractors or estimates expressly state that modernization or reconstruction work has been completed. Most likely, in such a situation, the judges will agree that the organization did not repair, but modernized the facility. In such cases, the court, in order to make a decision in favor of the tax authorities, it is enough to study primary documentation taxpayer (see resolution of the FAS of the East Siberian District of September 1, 2004 No. A33-13770 / 03-S3-F02-3528 / 04-S1).

Another, almost win-win argument for the tax authorities, is that the fixed asset received new properties due to the fact that additional units were installed on it. For example, the judges recognized the installation of POS terminals at a gas station as an upgrade (see Resolution of the Federal Antimonopoly Service of the Volga District dated February 17, 2006 No. A12-18688 / 05-C21).

In addition, inspectors and judges usually recognize as modernization the installation in buildings of a security or fire alarm system (see the decision of the Federal Antimonopoly Service of the Moscow District of April 4, 2006 No. KA-A40 / 2276-06-2).

Modernization and reconstruction can lead to an increase in the useful life of a fixed asset. Repair work excludes this option. Therefore, if as a result of the work performed, the useful life of the object increased, it was reconstructed. For example, in the resolution of the Federal Antimonopoly Service of the Urals District dated April 14, 2005 No. F09-1333 / 05-AK, it is said that the organization did not repair, but reconstructed its cars, since their useful life increased.

According to Article 257 of the Tax Code of the Russian Federation, modernization gives the object "other new qualities." Of course, the inspectors are trying to bring under this concept any changes that have occurred in the repaired fixed asset. And sometimes the judges agree with the tax authorities. Such an example. The company, in the process of repairing the barge, equipped it with mechanically operated hatches. Previously, the role of hatches was performed by a tarpaulin - with its help, the goods were protected from moisture. The court considered the installation of hatches a modernization due to the fact that the barge allegedly acquired a new quality as a result - “the possibility of additional protection of the transported goods” (see the decision of the Federal Antimonopoly Service of the Volga-Vyatka District of October 12, 2005 No. A43-35485 / 2004-30- 408).

Article 257 of the Tax Code of the Russian Federation states that the reconstruction is carried out, among other things, "in order to improve the quality and change the range of products." In one case, the inspectors took the term “improvement” out of context and convinced the judges that an improvement in the performance of the asset itself could be a sign of a refurbishment. As a result, the court recognized the repair of the reinforced concrete fence as a reconstruction, which, for obvious reasons, is indirectly related to the production of products and does not affect its quality in any way. The conclusions of the judges are given in the resolution of the Federal Antimonopoly Service of the North-Western District of October 17, 2005 No. А56-47182/04.

How to prove the reasonableness of expenses if the facility was repaired before it was put into operation

Often conflicts with inspectors arise in a situation where an organization has repaired a fixed asset that has not yet been put into operation and is listed on account 08. The tax authorities believe that the costs of such repairs are not written off as expenses at a time, but increase the initial cost of the fixed asset. The arguments are this. Since the fixed asset did not participate in the production process before the repair, the money spent on repair is considered to be aimed at bringing the object to a state in which it can be used. And such expenses increase the initial cost of fixed assets (clause 1, article 257 of the Tax Code of the Russian Federation).

This position of inspectors is often shared by judges (see, for example, the decision of the FAS of the Far Eastern District of July 27, 2005 No. F03-A51 / 05-2 / 2070). However, sometimes the courts under similar circumstances support the taxpayer. For example, the Federal Antimonopoly Service of the North-Western District, in its resolution of January 31, 2005 No. A56-10815 / 04, agreed that, on the basis of Article 260 of the Tax Code of the Russian Federation, the cost of repairing an object that had not yet been operated could be written off as a reduction . True, in this case, the taxpayer was helped by the fact that both the repair and commissioning of the facility took place in the same reporting period.

Indeed, in most cases, pre-commissioning repairs can be recognized as capital investments. But there is one important exception - when repairs are made, without which the object may well function. The money spent on such repairs does not increase the initial cost of the fixed asset and is subject to a one-time write-off to reduce taxable income.

However, it will be necessary to prove the optionality of such a repair in court. And victory in this case is not guaranteed. But if the company has already written off the funds spent on repairs as part of other expenses, and the inspectors threaten with a fine, the only way to avoid it is a trial.

If the repair is only planned, measures can be taken in advance to avoid conflict with tax authorities. To do this, you first need to put the facility into operation (at least formally, according to the documents) and postpone repairs until the end of this month. And already at the beginning of next month officially start repair work. In this case, they will not be able to reproach the company for the fact that it does not repair the fixed asset, but produces capital investments. As a result, there will be no obstacles in order to write off the amounts spent on repairs as other expenses, as prescribed by Article 260 of the Tax Code of the Russian Federation.

Alexander Yelin,

Company "ACADEMY AUDIT"

Any building, even the strongest, decays over time and requires repair. In addition, the owners change, and they may have their own plans for the building, according to which it needs to be rebuilt and modernized for new tasks.

What is building renovation

Reconstruction of buildings and structures implies a series of construction and installation works aimed at changing the characteristics of the building, communication or parts thereof in accordance with its new purpose.

These works include:

• expansion of existing buildings;
• superstructure of new floors, attics or other similar additional superstructures;
• adding new stairs and elevators;
• construction or demolition of outbuildings;
• reorganization of shops and lines;
• change in the total area of ​​the object;
• changing the purpose of buildings and their functions;
• change of engineering systems, excluding main ones;
• construction of ancillary and office buildings.

The main objective of the reconstruction is to increase the volume of functions that the building performs, improve working and living conditions and the quality of building maintenance. Reconstruction is carried out in several stages: pre-project preparation, geological surveys, detailed survey of structures and buildings, project development, implementation construction works and commissioning.

Reconstruction can be applied to a wide variety of objects − residential buildings; production powerful enterprises with large capacities and many objects on the balance sheet; non-residential buildings on adjoining territories; garages, sheds and baths.

What is Building Modernization

Modernization is different in that it is aimed at updating the facility and bringing all its systems in line with new technical requirements and standards, modern quality requirements.

Most often, modernization is carried out together with building overhaul and is economically feasible. It involves equipping the building with the necessary new equipment, improving the layout, increasing the quantity and quality of the building's functions, and landscaping the area around.

The main goal of modernization is to obtain a building that fully meets the new industrial, private and professional interests, the requirements of sanitation, fire and technical safety. Modernization differs from reconstruction in that it does not provide for an increase in the area or number of storeys of the building, but only for high-quality redevelopment for a new purpose.

Capital repairs of buildings

If we are talking only about repairs, then only the restoration of the building or its engineering systems is meant here. The purpose of the repair is to bring all the systems of the building into service, restore the equipment and maintain its operational characteristics.

Repair can be capital and current. Current repairs are carried out in a planned manner, with the aim of preventive maintenance and improvement of the object externally.

Overhaul of a building includes a detailed survey, replacement or strengthening of dilapidated elements, repair or replacement of the roof, as well as the attic, replacement of old windows and doors, renovation of basements and strengthening existing foundation.

In addition, if necessary, ceiling repair, reinforcement of beams and load-bearing structures, walls and partitions. During a major overhaul, unlike the current one, the building is completely decommissioned for the duration of the work. The supply of water, electricity and heat is cut off. Power supply, plumbing, sewage and heating systems are also being repaired, while wiring, batteries and other elements of communications and engineering systems may change.

The Alpstroy company is engaged in a variety of types of repair work, as well as modernization and reconstruction of industrial facilities and residential buildings. You can order from us overhaul of buildings and structures, taking into account all the features and selection of materials, calculations of terms and costs. By trusting us, you will receive high-quality orders within the stipulated time!

The modernization of industrial enterprises, houses and structures is often confused with their reconstruction. Various objects with any purpose can be subjected to such a procedure, and a change in qualitative characteristics does not always define the concept. Let's try to figure out what is the difference between these categories and how significant it is.

Definition

Modernization- this is an update of the object to bring it into line with modern standards, criteria, requirements. You can upgrade the education system, production, equipment or car.

Reconstruction- this is a purposeful activity to change the parameters of buildings and structures, individual elements of objects (height, number of storeys, etc.), the introduction and updating of engineering networks.

Comparison

Thus, reconstruction is either the restoration of the original state of the object, or its radical reorganization. This set of measures can be implemented only in construction and architecture. With regard to this industry, the reconstruction is aimed at changing technical indications (improving the layout of the building, increasing the total area, restoring the original appearance).

Modernization is the renewal of a structure due to its obsolescence. Immediately before these events, it no longer complies with the rules and regulations: engineering communications, the level of thermal insulation, and safety are outdated. In the field of industry, reconstruction is the restoration of production complexes that have not performed their functions for a long time. Modernization is a change in existing facilities in order to establish the production of modern products and increase the competitiveness of a particular plant or factory.

Findings site

1. Primary goal. The purpose of modernization is a radical reorganization of the facility, the introduction of new systems and networks that will make it modern. The purpose of the reconstruction is to change the characteristics of the building, the production complex, and improve its qualities.
2. Reason for holding. Modernization is carried out due to the fact that the object is outdated, and reconstruction is carried out due to general wear and tear.
3. The state of the object. After reconstruction, the quality of the object is improved, economic and technical characteristics are increased, or the original state is completely restored. After modernization, the functions of an object may change radically.

If an institution carries out repairs, reconstruction, modernization, additional equipment, then in order to accounting For a state, budgetary or autonomous institution, it is important to distinguish between these concepts, plan and take into account costs.

Terminology

The definition of repair, reconstruction and modernization terminology for accountants raises a lot of questions. The concepts of reconstruction, retrofitting and modernization are given in Tax Code RF.

Let's define the concepts:

Repair- this is troubleshooting to maintain the OS in working order (Letter of the Ministry of Finance dated 04/22/2010 N 03-03-06 / 1/289).

Repairs are subdivided into (Letter of the Ministry of Finance dated February 25, 2009 N 03-03-06 / 1/87, paragraph 3.4., 3.11. Regulations of the USSR Gosstroy dated December 29, 1973 N 279 "On approval of the Regulations on the scheduled preventive maintenance of industrial buildings and structures"):

Current - elimination of breakdowns, damages and malfunctions;

Capital - costly and / or long-term measures aimed at maintaining the health of the operating system: changing faulty, damaged or worn-out structures and parts of the operating system, incl. replacing them with more durable and economical ones.

Reconstruction- reorganization of the OS facility, associated with the improvement of production to expand capacity, increase the quantity and improve the quality of products. It is carried out under the reconstruction project. Reconstruction is usually understood as the reorganization of buildings (buildings, structures) (clause 2, article 257 of the Tax Code of the Russian Federation).

Modernization- improvement of the OS object in order to change its purpose, increase the workload, expand the scope of use (clause 2, article 257 of the Tax Code of the Russian Federation).

Additional equipment- addition of the object with parts (parts, mechanisms, units), as a result, the OS acquires new qualities (clause 2, article 257 of the Tax Code of the Russian Federation).

Functional purpose of the fixed asset

Further, when considering the principles that make it possible to draw a line between different types of work, the concept of "functional purpose of a fixed asset" will be repeatedly used. Before qualifying the type of work, it is necessary to clearly articulate what the main asset is intended for, and then determine how the performance of these functions will change as a result of the work. At first glance, it seems that it is not difficult to give such a definition (table).

Having formulated the purpose of the fixed asset in this way, it becomes easier to analyze further various situations. For example, in relation to buildings, what conditions should be created for people? - Lighting, water, sewerage. But does it apply to necessary conditions for work, the type of wallpaper or the material for finishing the ceiling?

The following sections will show how defining the functionality of a fixed asset becomes the key to distinguish between different types of work.

Functional purpose of the fixed asset

TO repair of OS (including capital) differs from the reconstruction, modernization and retrofitting of OS with goals and results (clause 2 of article 257 of the Tax Code of the Russian Federation, clause 27 of Instruction N 157n, Letters of the Ministry of Finance dated 04.22.2010 No. 03-03- 06/1/289, dated 12/05/2012 No. 03-03-06/1/628).

Repair

The concept of "repair" includes not only troubleshooting, but also maintaining the performance of the facility. In other words, repair work is aimed at restoring the full performance of the object of its functions.

Example 1

1. Troubleshooting:

• the car's engine is out of order, the car can't move.

2. Recovery performance:

• the car is still driving, but the engine power has noticeably dropped, fuel consumption has increased sharply, oil waste is significantly higher than the norm;
• the printer is still printing, but the print quality is poor, the printouts are fuzzy, with stripes;
• the window frames are still intact, but they have dried up so much that they cannot be opened, the room cannot be ventilated.

Even if as a result of the repair there was an improvement in the characteristics of the object, its value does not increase. This provision is especially relevant in relation to computer technology, the generations of which are changing very quickly.

Example 2

1. The computer hard disk (HDD) with a capacity of 80 GB has failed. At the time of the repair, there are no longer any discs with a capacity of less than 250 GB for sale. The result was an improvement in computer performance. However, the original reason for replacing the hard drive was to fix a problem, so the cost of the computer will not increase.

2. A very old building was handed over to the institution. The entrance wooden door to the building cracked, the door frame lost its integrity. The door does not provide its functions of protecting the building from the penetration of unauthorized people, as well as from atmospheric influences. A metal door of increased durability was purchased to replace it. There has been an improvement in the performance of the building, as a quality metal door provides better intrusion protection than a wooden one, as well as keeping out drafts and noise, but the root cause was the restoration of operational performance. Therefore, the value of the building does not increase.

3. As a result of hail, the slate roof was partially damaged. After that, the roof was completely covered with metal tiles. There has been an improvement in the performance of the building, as the metal tile resists weather better, but the root cause was the restoration of performance. Therefore, the value of the building does not increase.

traditionally differ different levels repairs: current, medium and capital. At the same time, there is no unambiguous distinction between these concepts in the legislation. For example, in Urban Planning Code In the Russian Federation, the term "overhaul" occurs repeatedly, but its definition is not given. Because in terms of application budget classification and order of conduct budget accounting there are no differences between current, medium and major repairs, the accountant does not need to distinguish between such expenses.

At the same time, it is necessary to take into account the fact that in practice construction organizations major repairs often mean a set of works to improve facilities capital construction, which does not correspond to the terminology defined by the budget legislation.

Finishing work can be distinguished as a separate type of repair. The Ministry of Finance of Russia does not have a definition for this term, but its meaning can be understood from the above list of works. Finishing works are works that are not caused by the restoration of the object, but do not lead to an improvement in its main characteristics, for example, painting in a different color.

Basically, the term "finishing work" is applied to capital construction objects, but by analogy it can also be attributed to vehicles (a car can also be painted in a different color without the purpose of restoration) and to any other property when the work concerns only changes appearance object.

It is precisely the definition of the functional purpose of the fixed asset that will help to distinguish between finishing work and work leading to the improvement of the fixed asset. If the work does not affect the quality of the performance of the main functions and does not add new functions, then such work can be classified as finishing.

Example 3

1. Seat upholstery reupholstery in a car does not affect the performance of its main functions - the movement of people and goods. Consequently, these will be works on the maintenance of property - either repair and restoration, or finishing.

2. Replacing the bars on the fence does not affect the performance of its main functions - to mark the boundary of the site and prevent it from crossing (unless, of course, the height of the fence has increased). Consequently, these will be works on the maintenance of property - either repair and restoration, or finishing.

Reconstruction, modernization, additional equipment

The term "reconstruction" is used when expanding or changing the capabilities of a fixed asset.

Reconstruction involves changing the parameters of an object. Reconstruction also includes improving the quality of engineering and technical support, however, the content of these works in normative documents is not explained.

Example 4

Internal redevelopment of premises by installing light non-capital partitions is not a reconstruction, but refers to finishing work, since the parameters of the building as a capital construction object do not improve.

The installation of an additional second internal door at the entrance to the building will not be a reconstruction, although it will increase the cost of the object under the retrofitting category of work, since the second door improves winter weather protection and adds intrusion protection.

The term "modernization" involves the replacement of nodes, and these nodes must be in good condition. If a faulty unit is replaced, then such work is not an upgrade, but a repair. If no nodes are replaced, then such work is retrofitting.

Thus, for the correct application of the term "modernization", it should be clearly understood what it means to replace a good part: the part must be good before replacement, but does not have to remain so after dismantling.

Example 5

1. Replacing a good CD-ROM drive on your computer with a new DVD-ROM would be an upgrade, as it would change a good part. If the defective CD-ROM drive is replaced with a new DVD-ROM drive, this should be considered a repair.

2. Adding RAM to a computer is not a modernization, since in this case no nodes are released, but the object is retrofitted.

The term "equipment" involves an inherent improvement in an item of property, plant and equipment. It follows from this that new parts added to the object must, firstly, be difficult to separate, and secondly, give the object new properties.

Example 6

1. Finishing works in the building, even the most seemingly changing its appearance, for example, the installation of an external "ventilated facade", the installation of suspended ceilings inside the premises, do not give the building any new functions beyond the main one - weather protection and ensuring the safety of the existing property . Therefore, finishing works are not retrofitting.

2. Installing an optional roof rack on the car is not retrofitting, since the roof rack is easily removed.

3. Installing a towbar on a car is an additional equipment, since the towbar gives the car new opportunities (towing a trailer) and is not easily removable.

4. The application of road markings, of course, increases road safety, but road markings cannot be considered an integral improvement, since they are erased after 1-2 months. Consequently, the work of marking does not lead to an increase in the cost of the road.

Actual question

Does installing software increase the cost of a computer?

To understand this issue, we use the definitions of reconstruction, modernization and retrofitting. So, these works do not relate to reconstruction, since the computer is not an object of capital construction. Upgrading is also excluded, since when installing programs, even if a replacement program is installed, no components and parts are released from the computer. Additional equipment should also be excluded. Firstly, no program improves the characteristics of a computer and does not give it new properties beyond those that are built into it constructively. Secondly, the program does not form a single whole with the computer, as the definition of the term requires, and can be easily removed.

Thus, within the framework of the current definition of terms, there are no grounds for increasing the cost of a computer at the expense of software. Moreover, it makes absolutely no difference whether software after commissioning the computer or in advance (so-called pre-installed software).

Work planning

An important task at the stage of work planning is setting goals and determining the scope of work.

Goal definition

In order to correctly determine which category of work, repair or reconstruction (modernization, retrofitting), the operation that the institution plans to carry out belongs to, first of all, you need to determine the goal.

If the initial goal of the work is to restore working capacity or technical characteristics, or external changes that do not affect the quality of the object's performance of its functions, then repairs are being carried out.

If the purpose of the work is to improve the main characteristics of a serviceable object or add new functions, then they can be classified as reconstruction, modernization or retrofitting. In this case, further it is necessary to decide on the choice of one of the three types of operations. If the operation involves the replacement of components or parts, then this is a modernization (or reconstruction). If the operation involves the addition of nodes and parts, then this is additional equipment (or completion).

Justification of the need for expenses for the work

In order to exclude unnecessary questions about the advisability of carrying out repair and other work, as well as to streamline all operations with property, including the restoration of fixed assets, it is recommended that the institution set at the level accounting policy following order:

1. Appoint by a separate order (instruction), not including in the text of the accounting policy itself, persons responsible for the operation various kinds property under operational management, use, lease, etc. At the same time, such persons do not have to be financially responsible. For example, the person who owns the computer may be financially responsible for the computer, and a specially designated qualified person may be responsible for the operation of all computers in the institution.

2. To oblige the persons responsible for the operation of property objects to exercise control over their technical condition, as well as to draw up applications for repairs, reconstruction, modernization, and additional equipment. Determine that the specified work is not performed without a corresponding request approved by the manager.

3. Install the application form. A sample of filling out the tabular part of the application is given below (the header should contain the details of the institution, date and number, the signature of the head, and the basement - the signature of the person responsible for the operation of the property).

When carrying out an inventory of capital construction objects, not only their actual availability is checked, but also their technical condition. Consequently, in relation to capital construction objects, the first confirming document for the work will be a text appendix to the Inventory Act, where objects and their parts in need of repair and reconstruction will be marked. An inventory of the state of capital construction objects must also be carried out if they arrive at the institution within of the year.

Application for repair, reconstruction, modernization, retrofitting

Should be taken into account!

When carrying out an inventory of capital construction objects, not only their actual availability is checked, but also their technical condition. Consequently, in relation to capital construction facilities, the first confirmation document for the work will be a text appendix to the Inventory Act, where the facilities and their parts in need of repair and reconstruction will be marked. An inventory of the state of capital construction objects must also be made if they enter the institution during the year.

The person responsible for the operation of the property must draw up applications, whether or not funds are available to carry out the proposed activities. The introduction into practice of the institution of such a procedure for planning repair and other work will solve not only the problems of substantiating expenses during control and audit activities, but also systematizes all the activities of the institution for the maintenance and maintenance of property. Also, when developing an accounting policy, it is advisable to make a decision regarding requests for the replacement of consumables (toner, cartridges) and routine maintenance.

At the stage of planning work on reconstruction, modernization, additional equipment, it is necessary to take into account the requirements of Art. 34 of the RF BC, which establishes the principle of effectiveness and efficiency in the use of budgetary funds. And local governments receiving interbudgetary transfers (with the exception of subventions) should also take into account the requirements of Art. 136 BK RF.

In other words, it is necessary to be ready to justify the expediency of the improvements made to the property and finishing works, as well as the fact that the ongoing improvements are aimed specifically at better implementation of the main activities of the institution. For example, what agency would be able to indicate the reason when drawing up an application for work on installing a car radio in a car (if it was not in the factory delivery)?