Question: Hi Gabbies! Ask ko lang po kung kelan po ba dapat magtransfer ng Construction in Progress- Building to PPE? Is it on the date of certificate of completion or final acceptance of the entity? Pa-share namn po ng guidelines kung san ko po pwedeng makita. Thank you po!
Here are some of the answers of our colleagues on this question :
Completion Date. However in actual transactions, completion date and final payment date may have a gap such that at the Time of Completion, Accounting cannot transfer CIP to PPE yet as Cost is still incomplete pending disbursement of final payment (if transfer is done before final payment, negative CIP balance results). By the time contractor’s billing is paid, the remaining balance is debited to CIP, only then Asset Cost is completed and is now ready for transfer to PPE. – Jill Odessa Castardo
GAM Volume 1 Chapter 10 Property Plant and Equipment Sec. 8 g. Construction of PPE: states as soon as the construction is completed ” Construction in Progress” account shall be reclassified to the proper asset account. – Nimre Porky
Ideally, upon completion. But in practice, upon final payment unless you set up accounts payable at the point of completion. Yun ay kung nabigyan ka ni Construction Section/Division ng Reliable na Approved Completion report. – Nomer Yecla Quimpo II
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