What is it in finance?

MOTHBALLING is the practice of introducing functional equipment and equipment into storage, so they are no longer operated, but can be reused in the future. There are a number of reasons why businesses are connected to Mothballing. This activity keeps the equipment and equipment under the ownership and inspection of the company and at the same time leaves them from the current operation.

operating costs can be high for many devices. If the company does not use the device so hard, it has a reason to assume that the device will enter the inactivity period or must reduce operating costs, it may broadcast the device. Likewise, companies may decide to exclude the equipment from the commission seasonally, maintain ownership, but do not use it if it is not needed. The device can also be Mothballled when the company thinks it could turn off, but does not want to make immediate decisions. Things can be discussed, oiled, wrapped and otherwise treated to stay in operation without being used. Power can be cutThe equipment or is the need for limited power, the systems can be turned off to reduce the use of usefulness and at the same time ensure that the power supply gets where they have to go. MONTHALLED devices can have guards and safety system to keep it safe, but normal staff is released because their services are no longer needed.

Sometimes MOTHBALL equipment indefinitely. In other cases, Mothballing is scheduled or is carried out to keep the device safe and in search of the buyer. In these cases, the company may open a check -up device as required by the buyer. Buyers who offer offers are aware of the mothballing and can check that the equipment and supplies are safely stored to be removed from the storage and use immediately after the sale.

For tax purposes, Mothballing can be processed in different ways. Companies have maintenance and secureThe device connected with certain costs and is a legitimate business expenses. It is also important that companies take steps to clarify that they do not leave the device. If the equipment is abandoned and has become abandoned, there is a risk that government regulators will enter and order companies to make repairs or confiscate assets so that it can be secured and then sold.