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3 years ago

The modified approach to accounting for infrastructure assets may be utilized by a state or local government if:

Business

1 answer:

icang [17]3 years ago

6 0

Answer:

I, II and III

Explanation:

Approaches to Accounting for Infrastructure by State or Local Government

Traditional Depreciation Approach

This approach depreciates infrastructure assets consistently with other assets. This approach lists infrastructure assets as part of depreciable assets

Modified Approach

This approach treats infrastructure assets under a few criteria:

Maintenance and Preservation costs are reported as expenses and depreciation expenses are not required
Infrastructure Assets are listed as Capital Assets and non-depreciable assets
There is an asset management network or subsystem in place that preserves the assets. This system is committed to maintaining the infrastructure at a specific condition level

Combined Approach

This system combines both the traditional depreciation methods and the modified approach for infrastructure assets. The Infrastructure system can be divided into sub-systems and the traditional depreciable approach can be used for a sub-system while the modified approach is used for an other sub-system

Modified Approach to accounting for infrastructure assets

Based on the Criteria for Modified approach system:

Option 1: Accumulation of information about all infrastructure assets within either a network or subsystem of a network will allow the use of the modified approach

Option 2: The Capitalization of infrastructure assets is also a feature of the Modified Approach

Option 3: Grouping maintenance cost of infrastructure assets as expenses also allow the use of the Modified Approach

Option 4: The Depreciation of Infrastructure assets will only allow the use of the Tradtitional Depreciation Approach

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