Dilapidations

Dilapidations

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A new client has informed me that dilapidations should have been accounted for on a lease hold building.

There is no lease hold or dilapidations on the balance sheet.

Where do I account for the dilapidations for the year end on the balance sheet?

Do I show it separately or can I add it with depreciations and add a note to the balance sheet?

Thank you in advance for any info

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By Burbage Accounting
07th Feb 2012 19:45

accounting for Dilaps

Hi,

 

Dilaps are normally capitalised along with leasehold improvements on the balance sheet and depreciated over the minimum lease period. I would take any additional increases to the dilaps provision which do not relate to leasehold imporvements straight to the P&L (repairs and maintenance)

 

The credit side of the entry would sit in accruals under long term debtors assuming the lease expires in more than one year.

 

Hope this helps

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