[Code of Federal Regulations]

[Title 48, Volume 7]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 48CFR9904.404.20]



[Page 364]

 

            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM

 

     CHAPTER 99--COST ACCOUNTING STANDARDS BOARD, OFFICE OF FEDERAL 

           PROCUREMENT POLICY, OFFICE OF MANAGEMENT AND BUDGET

 

PART 9904_COST ACCOUNTING STANDARDS--Table of Contents

 

Sec. 9904.404.20  Purpose.



    This Standard requires that, for purposes of cost measurement, 

contractors establish and adhere to policies with respect to 

capitalization of tangible assets which satisfy criteria set forth 

herein. Normally, cost measurements are based on the concept of 

enterprise continuity; this concept implies that major asset 

acquisitions will be capitalized, so that the cost applicable to current 

and future accounting periods can be allocated to cost objectives of 

those periods. A capitalization policy in accordance with this Standard 

will facilitate measurement of costs consistently over time.