SOME ACCOUNTING AND ANALYTICAL PROBLEMS OF REPAIR OF FIXED ASSETS AND THEIR SOLUTIONS

Abstract

The company, which has fixed assets on the balance sheet, bears the costs of maintenance and repair. The article considers how to properly classify and reflect these costs in the accounting and tax accounting of the enterprise. For the correct classification of works it is recommended to create a special commission at the enterprise. Since business entities have on the balance sheet buildings, they bear the costs of maintaining them in working condition, in connection with this, complications usually arise related to the qualification and reflection of these costs in accounting and tax accounting. It is important for an enterprise that uses motor transport in its activity to determine the classification of repair operations: is such an operation its overhaul or current repair, maintenance or improvement? Mistakes can lead to overestimation of costs, incorrect determination of the book value of vehicles. It was noted that the main difference between maintenance and repairs is that maintenance is aimed at maintaining the car's performance, while repairs are aimed at restoring its performance. Improvements mean modification, modernization, retrofitting, reconstruction of the object of fixed assets, which lead to an increase in the future economic benefits originally expected from the operation of the object. As an example, this is the installation of alarms, control devices, awnings. The consequences of such errors – distortion of financial statements, the object of VAT and income tax, the single tax. The decision on the nature and characteristics of the repair work to be performed is made by the head of the enterprise, taking into account the analysis of the situation and the materiality of the costs. Such a decision should be made on the basis of a technical opinion on the direction of the planned measures, which is provided to the manager by a specialist of the relevant profile, for example, a mechanic. And the accountant, based on the manager's decision, must reflect this operation in the accounting. Thus, the company independently determines the direction of repair works. Proper classification of costs for maintenance and repair of cars will help to accurately reflect them in the account, and thus avoid possible penalties.