Pls clarify whether the below expenditure needs to be capitalised/Charged to revenue
Our unit currently has a very old electrical system and does not meet any electrical safety standards. incidents like frequent failures & puncturing of buried aluminium cables etc were observed in the premises.
As such a replacement is required to ensure electrical safety.
A consultant has been appointed to undertake a study on safety and suggested Replacement of Cables, Panels and distribution boards of entire premises. A lightning protection system has also been suggested.
So the bottom line is "In order to improve the personal safety and safe working environment and to ensure electrical safety, it is proposed to replace the existing cables, panels & distribution boards and to provide earth pits & complete the installation of Lightlning protection system".
There are two components
a) Replacement to existing cables etc as stated above
b) Installation of Lightning protection system (First time).
Pls give your views on both the items??
CAclubindia
