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Is depreciation expense considered as a recurring cost?

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In project cost management, can we consider depreciation expenses to be recurring costs? Another question, does the project manager need to worry about depreciation expenses or is it the job of the company's accounting department?
asked 7 years ago by anonymous edited 7 years ago by MaplePM

1 Answer

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Most likely this decision (is it a recurring cost and do I need to worry about it for my project) falls within the realm of your Finance department for two reasons:

- Depreciation is an operating cost -- you may encounter it in planning how to roll out your project at completion or in equipment you use for a short while during your project, however as a business operating expense it would most likely be shared by other projects and operations.  As a shared expense you wouldn't have the necessary information to calculate the portion required by your project.  If you need the figure for budgeting purposes, get it from Finance.

- Depreciation is based on the useful life of equipment which isn't as straightforward as it sounds.  US and Canadian tax laws have complex rules to make a determination.  In addition, there are many ways to calculate depreciation and this would be the call of your Finance department.  The calculations permitted are also heavily governed by tax laws and are not always straightforward.
answered 7 years ago by sdcapmp (45,840 points)

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