[Question] Transfering/Recognising asset stake in/to main Project

[Nakwila]

Good Morning All,

Compliments for 2018, Wishing you all a prosperous year!

I need insight/assistance in accounting for the following, kindly guide me...

We are busy erecting a building which will benefit all projects. We are running an NGO, lets call it ABC it is the main organisation. Under it, Various individual donor projects are managed and operated. Lets call them Project 2, Project 3, Project 4 and Project 5.

All these projects 2 to 5 contributed towards the building, recognising expenditures within these projects. What accounting entries should one pass to recognise the building as a whole in the main organisation ABC, yet recognising the asset interest within ABC at individual project level. As of now, these costs are expensed in the various projects.

Hope my explanation is clear...thanking you in advance!

BR,
Nakwila

[Dave A]

What accounting entries should one pass to recognise the building as a whole in the main organisation ABC, yet recognising the asset interest within ABC at individual project level.

Asset interest or asset contribution?

Fundamentally capital expenditure should be recognised as such, and I get that is what you want to do. However, that value needs to be recognised where the capital ownership/interest lies.

[Nakwila]

Asset interest or asset contribution?

Fundamentally capital expenditure should be recognised as such, and I get that is what you want to do. However, that value needs to be recognised where the capital ownership/interest lies.

Thank you Dave. Yes, I mean the asset contribution. What entries should one pass in the contributing projects and in the Main Project?

[Dave A]

Not sure this is the information you're looking for (as it seems rather obvious/simplistic), but in essence you'd be debiting the relevant asset account (of the building) and crediting the relevant expense account (where the expenditure was initially recognised).

If that doesn't give you the guidance you're looking for, you're going to have to be more detailed as to the challenge you're trying to resolve.