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Restoration Obligations
Restoration obligations are costs to return the asset to its original condition at lease end.
What Are Restoration Costs?
Dilapidations, make-good provisions, and asset removal costs.
Accounting Treatment
Added to ROU Asset with corresponding Section 21 provision.
FRS 102 Reference: FRS 102.20.13, Section 21
Restoration Impact
Lease Liability: £100,000
Restoration Cost: £15,000
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ROU Asset: £115,000
Dilapidation Provision: (£15,000)