7.12 Construction in Progress
7.12.1 Construction in Progress Definition
Construction in progress reflects the economic construction activity status of buildings and other structures, infrastructure (roadways, energy distribution systems, pipelines, etc.), additions, alterations, reconstruction, installation, and maintenance and repairs that are substantially incomplete.
7.12.2 Depreciation Methodology
Depreciation is not applicable while assets are accounted for as construction in progress. Refer to the appropriate capital asset category when the asset is capitalized.
7.12.3 Capitalization Threshold
Construction in progress assets should be capitalized to their appropriate capital asset categories upon the earlier occurrence of execution of substantial completion contract documents, occupancy, or when the asset is placed into service.