How to Record CAS 417 Cost of Money
Records the cost of money as an element of the cost of capital assets under construction as per CAS 417.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Construction in Progress (CIP) | Asset | 15,000.00 | - |
| Cost of Money Credits - CAS 417 | Contra-Expense | - | 15,000.00 |
💡 Accountant's Note
CAS 417 requires the capitalization of cost of money for assets that take a significant amount of time to construct or prepare for use. This involves debiting the asset account and crediting a cost of money contra-account.
Practitioner & Systems Framework
💻 ERP Architecture
Ensure the ERP is configured to calculate cost of money based on the average balance in CIP for the period.
⚠️ Audit Flags
Incorrect interest rates or applying cost of money to assets that do not meet the CAS 417 criteria for duration and cost.
📄 Required Documentation
Calculation worksheets using the Secretary of the Treasury's specified interest rates (Renegotiation Board rates).
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