As-built completion is the joint connecting the construction world with the factory accounting world: the as-built file proves the work was built and accepted to the design and permit, on which basis the enterprise books the fixed asset, starts depreciation and defends construction costs at tax finalisation. In practice many plants operate for years with missing or reality-diverging as-built files, and the price appears exactly at the first tax finalisation or when the asset must be mortgaged or transferred.
What the as-built file contains
A complete as-built file has four groups: the legal group — construction permit and amendments, design appraisal, fire appraisal and acceptance, environmental documents and the authority acceptance-work inspection minutes where applicable; the construction group — as-built drawings showing the true built state, construction and supervision diaries, work and stage acceptance minutes, material and equipment records; the completion acceptance group — the completion acceptance minute, remedied outstanding item lists and specialised acceptance approvals; and the financial group — contracts, liquidation minutes, construction value finalisation and invoices and vouchers.
The as-built drawing is the central document: it must redraw exactly what was built in reality, including approved in-construction changes from the approved design. Copying the design drawing as the as-built while actual construction differs is the most common and most dangerous error, because it falsifies the basis for every later renovation, valuation, insurance and incident handling of the plant.
As-built files, fixed-asset booking and depreciation
Under accounting rules, a factory is booked as a fixed asset when the work is completed, accepted and ready for use, with initial cost comprising all construction costs, attached equipment and valid related costs gathered through the finalisation file. The as-built file and completion acceptance minute are the foundational evidence of that booking; without them, the asset cost lacks full proof even if the money was genuinely paid through banks.
Fixed-asset depreciation starts when the asset is ready for use under the current fixed-asset management, use and depreciation regime; a factory belongs to the buildings and structures group with a long depreciation frame, and the enterprise registers its specific depreciation period within the frame with the tax authority when starting. Depreciation counts as a deductible cost only where the asset carries full invoices, vouchers and legal files proving the enterprise ownership and use rights.
Missing as-built files: tax finalization and asset transaction risks
At tax finalisation, the tax authority cross-checks construction costs and depreciation against the work legal file: costs lacking valid vouchers and acceptance, or corresponding to unlicensed or breach-built parts, risk being disallowed as deductible costs with corporate income tax clawback plus late-payment charges. This risk does not fade with operating time but persists until tax clawback and inspection limitation periods expire, and resurfaces at every later inspection.
Beyond tax, missing as-built files block asset transactions: banks appraising mortgages require the factory legal and as-built files; buyers in M&A treat as-built documentation as part of asset legal due diligence; and registration of land-attached assets in related land procedures also needs acceptance and as-built records. Rebuilding an as-built file years later — resurveying the current state, quality-testing the work — costs many times more than doing it right at construction end, and some parts can never be recreated, such as construction diaries and stage acceptance minutes.
Frequently Asked Questions
What documents does a factory as-built file contain?
Four groups: legal (construction permit and amendments, design appraisal, fire appraisal and acceptance, acceptance-work inspection); construction (as-built drawings true to the built state, construction and supervision diaries, work and stage acceptance minutes, material and equipment records); completion acceptance (completion acceptance minute, outstanding item handling, specialised approvals); and financial (contracts, construction value finalisation, invoices and vouchers).
Is as-built completion a condition for booking the factory as a fixed asset?
Evidentially yes: a fixed asset is booked when the work is completed, accepted and ready for use, and the as-built file with the completion acceptance minute grounds the initial cost and the enterprise ownership and use rights. Without the file, booking and depreciation lack their evidence base when tax authorities and auditors cross-check.
When does depreciation of construction costs start, and how long is a factory depreciated?
Depreciation starts when the asset is ready for use under the current fixed-asset depreciation regime. A factory belongs to the buildings and structures group with a long depreciation frame; the enterprise selects and registers a specific period within the prescribed frame with the tax authority. Deductibility requires full invoices, vouchers and legal files.
Without as-built files, are construction costs disallowed at tax finalization?
The risk is high: tax authorities cross-check construction costs and depreciation against the work legal file; parts lacking valid vouchers and acceptance, or matching unlicensed and breach-built portions, can be disallowed as deductible costs with CIT clawback and late-payment charges. Missing files also snag bank mortgages, M&A and asset registration.
This article has been quality-reviewed by the FLAW AI Legal Council