Account 07 “Equipment for installation” is intended for information about equipment to be installed in buildings under construction. The debit of the account collects the costs incurred by the organization before the equipment is ready for installation, and then is written off from credit 07 to Dt 08.

 

If equipment received by an organization needs to be installed before being put into operation, an account is used to reflect such operations. 07 “Equipment for installation”. It collects all the data on the costs of a unit of technical equipment: purchase, transportation, commissions to intermediaries, contracts with contractors - that is, costs that form the initial cost of the asset without the cost of assembly and installation. Then the amounts are credited to account 08, where its value is finally formed by installation costs, and from 08 - to Dt 01.

Account functions 07 are similar to the functions of account 08 “Investments in non-current assets", however, there are fundamental differences:

• on account 07 is not taken into account technical equipment, which does not require commissioning and installation work (cars, household equipment, computers and office equipment, and so on): for these purposes, account 08 is used;
• sch. 07 is used by construction firms to account for costs in newly constructed or reconstructed buildings.

Account 07 is active, that is, the debit reflects the increase in the cost of the operating system and the costs of installation and installation, and the credit reflects the decrease (putting into operation or writing off for another reason).

The cost of the purchased asset and the costs of its installation and installation are recorded in Dt 07 without VAT: the amount indicated in the invoice is divided into the actual price of the object (recorded in Dt 01) and the amount of VAT (in Dt 19).

Regulatory framework

Application is regulated by the Chart of Accounts established by the Instruction of the Ministry of Finance dated October 31, 2000 No. 94, PBU 6/01 “Accounting for fixed assets” and other documents.

Postings and operations

1. Receipt of equipment.

The receipt of technical equipment requiring installation may occur as a result of a purchase, self-assembly, gratuitous transfer, contribution to the authorized capital.

Prepared with postings:

Dt 07 Kt 60 - the acquisition of the asset is reflected; costs of delivery, setup, storage under contracts with third-party companies;

Dt 68 Kt 19 - VAT deductible.

Founder's contribution to the management company:

Dt 07 Kt 75.

2. Transfer to the installation.

When the OS is ready for installation, it is written off to account 08:

Dt 08 Kt 07 - transfer for installation;

Dt 08 Kt 60 - costs of installation and installation under contracts with third-party companies are taken into account;

Dt 01 Kt 08 - property is accepted for accounting as fixed assets.

3. Disposal of equipment for installation.

Sometimes a situation arises when technical equipment that has not yet been installed is disposed of before it is installed or accepted as fixed assets. Such situations arise as a result of:

• sales,
• damage,
• theft,
• gratuitous transfer, etc.

If a fixed asset is retired due to technical unsuitability, it is written off in Dt 94:

Dt 94 Kt 07.

If you decide to sell the asset, the income is credited to account 91/1 “Other income”:

Dt 91/1 Kt 07.

VAT

When working with account 07, accountants often have questions about the procedure for VAT refund.

Clause 1 art. 172 of the Tax Code of the Russian Federation stipulates that VAT on acquired fixed assets is accepted for deduction when the object is accepted for accounting. From the Instructions to the Chart of Accounts it follows that the reflection of a technical device in accounting as equipment for installation can also be considered as the acceptance of an asset for accounting, because this reflects information about the incoming fixed asset item.

Hence the conclusion that the tax can be reimbursed when the equipment is capitalized (costs for Dt 07 are generated):

Dt 07 Kt 60 - the purchase of equipment is reflected;

Dt 19 Kt 60 - input VAT allocated;

Dt 68 Kt 19 - tax is presented for deduction;

Dt 08 Kt 07 - asset transferred for installation;

Dt 01 Kt 08 - equipment has been capitalized.

Attention! VAT can only be deducted on equipment intended for use in a VAT-taxable activity. That is, if an organization, for example, combines UTII and the traditional taxation system, the tax can only be reimbursed for equipment involved in activities taxed under the traditional system.

If the received equipment requires preliminary assembly before being used for its intended purpose, then account 07 “Equipment for installation” is used to account for it.

This account is used by developers who purchase equipment for its further installation and fastening in a construction project under construction or renovation. The debit collects the costs incurred during the acquisition of equipment; from the credit, the amount of all costs is written off to account 08 to complete the installation procedure or to other types of accounts upon disposal as a result of write-off, sale, or gratuitous transfer.

When filling out the annual balance sheet, if there is a debit account balance 07, it is taken into account as part of field 1150 (fixed assets).

What is taken into account on account 07

It is necessary to record on account 07 only that equipment for which, before putting it into operation, it is necessary to assemble its components and attach it to load-bearing structures - the floor, foundation, supports. Account 07 is only active.

This can be equipment of a technological, production, energy nature, as well as equipment used in workshops and laboratories during the construction of a new construction project or modification of an existing one.

It also takes into account sets of spare parts for such equipment, various control, measuring and other instruments installed in the mounted equipment.

Account 07 does not take into account objects that do not require assembly before being used for their intended purpose:

• Various types of transport;
• Machines that are integral structures;
• Mechanisms for construction purposes;
• Agricultural machines;
• Tool;
• Manufacturing equipment;
• Devices not related to the components of the mounted object.

The above assets should be accepted immediately in the form of OS in the debit of account 01, bypassing account 07.

Receipt of equipment for installation

Possible receipt at the time of purchase, in the form of a free gift or through a contribution to the capital of the company. All costs that the company incurs in this case are recorded in debit 07. Their amount determines the actual cost of the purchased equipment that needs installation.

This cost includes:

• The price of the components of the equipment indicated in the attached accompanying documentation (agreement, invoice, act);
• Costs of delivering valuables to the warehouse;
• Setup and storage costs;
• % on loans received to pay for the cost of components of equipment;
• Expenses of an accountable person purchasing equipment independently;
• Other costs.

Video lesson “ Account 07 in accounting. Equipment for installation: accounting, examples, wiring“

Video lesson from expert practitioner “Accounting and tax accounting for dummies” Natalya Vasilyevna Gandeva about accounting for account 07 “Equipment for installation”, drawing up standard entries and examples of equipment accounting. To open a video, click on it. ⇓

Postings to the debit of account 07

When the equipment components are received at the warehouse for installation, entries are made to reflect all expenses incurred by the company. These expenses are reflected in debit 07 in correspondence with accounts, the type of which depends on the method of receipt of equipment to the enterprise.

Cost accounting entries for purchased equipment requiring installation or assembly are carried out on the basis of the relevant documentation accompanying these objects.

If there is an invoice among this documentation, and the company is considered an added tax payer, then the expenses are reflected in account 07 excluding VAT, which must be allocated to a separate account 19. If the company is not a payer due to the exemption or absence of such an obligation, then the claimed VAT must be included in the cost of the equipment, formed by debit 07 of the account.

An option is possible when the company accepts such equipment at discount prices in a manner similar to receipt material assets after 15 counts.

Possible entries for debit 07 are shown in the table:

Operation	Debit	Credit
The price of equipment from suppliers’ documents is taken into account	07	60
Costs for delivery of equipment parts produced in-house are taken into account	07	23
Transport costs incurred in connection with arranging delivery by a third party company are taken into account	07	76
The receipt of equipment at discount prices is reflected	07	15
Interest on loans received for the purchase of equipment for a period of up to 1 year is taken into account.	07	66
Interest on loans with a term exceeding 1 year is taken into account.	07	67
The accountable person's costs associated with the acquisition are taken into account	07	71
The cost of equipment contributed by a company participant in the form of a contribution to the company’s capital is reflected	07	75
Equipment from the head office or branch of the organization has been accepted for accounting	07	79.1
The object was accepted in the form of a contribution under an agreement on joint activities	07	80
Accepted equipment for targeted events	07	86
An object discovered during inventory in the form of surplus was capitalized	07	91.1

Transfer to installation

When transferred for installation, the amount of all costs recorded in debit 07 is written off from the credit in one amount in debit 08. Such posting is carried out on the basis of a transfer and acceptance certificate, for registration of which you can use.

Assembly can be carried out by hiring a contractor or using your own employees.

If the assembly is carried out by a third-party contracting organization, then the contractor records the received equipment spare parts in off-balance sheet account 005. At the time the finished object is delivered to the customer, its cost is written off from the credit of account 005.

Depending on the type of costs, debit 08 interacts with the credit of accounts:

• 60 or 76 – when paying for services of third-party companies;
• 23 – when taking into account the expenses of auxiliary production incurred in connection with the assembly and fastening of components of equipment;

Accounting for these costs is carried out on the basis of relevant documentation. If the installation is carried out by a third-party company, then this is an act of completion of work; if the installation is carried out by in-house personnel, then this is an accounting certificate.

If the contractor presents an invoice, then VAT is deducted on account 19, provided that the developer company is classified as a payer of the added tax.

The object assembled and installed in the right place is credited as OS to account 01.

Postings for acceptance of finished equipment for accounting are summarized in the table:

Disposal of equipment for installation

Disposal of purchased but not installed equipment listed on account 07 is possible as a result of:

• Write-offs due to unsuitability;
• Sales to another person;
• Free transfer, etc.

Unusable equipment that did not have time to be transferred for installation is subject to write-off from credit 07 to debit 94. If no specific person is to blame for the cause of the write-off, then the losses are included in other expenses, otherwise - to the accounts of specific guilty employees.

If it is decided to sell the object without installation or transfer it as a gratuitous gift, then this procedure issue through 91 accounts. Subject to availability tax liability Upon payment of VAT, it must be calculated from the value (sale value when selling or market value when donating) for subsequent transfer to the budget.

Postings to account credit 07

Operation	Debit	Credit
Equipment for assembly was transferred	08	07
Equipment not included in the operating system is used for auxiliary production purposes	23	07
The transfer of the object to the head office or branch of the company is reflected	79	07
The equipment was transferred to the joint venture participant upon termination of the relevant agreement	80	07
The cost of an uninstalled object is included in other expenses upon sale or donation	91.2	07
The cost of unusable equipment has been written off The shortage of this object, its theft or theft is reflected	94	07

An example of recording equipment for installation when it is stolen

The development company bought equipment for subsequent assembly for 472,000 rubles. (RUB 72,000 VAT). Delivery was carried out by our own transport department, the total cost was 15,000 rubles. A month later, the equipment was stolen, the culprits have not been identified.

Postings:

Operation	Sum	Debit	Credit
The equipment was purchased by the developer	400000	07	60
Separately allocated VAT on supplier documents	72000	19	60
VAT refunded	72000	68	19
Shipping costs included	15000	07	23
The detected shortage due to theft is reflected	215000 (200000+15000)

How can an organization take into account technological, energy and production equipment that requires installation and is intended for installation in facilities under construction or reconstruction?

Chart of accounts accounting and the Instructions for its use to summarize information about the presence and movement of such equipment is intended for the active synthetic account 07 “Equipment for installation” ().

This account also takes into account equipment that is put into operation only after its parts are assembled and attached to the foundation or supports, to the floor, interfloor ceilings and other load-bearing structures of buildings and structures, as well as sets of spare parts for such equipment.

Account 07 or 08 “Investments in non-current assets”?

If the equipment does not require installation, then it is not taken into account on account 07. Costs for the purchase of such equipment are collected directly on account 08 (Order of the Ministry of Finance dated October 31, 2000 No. 94n).

Examples of objects for which account 07 is not used are:

• vehicles;
• free-standing machines;
• construction mechanisms;
• agricultural machinery;
• production tool;
• measuring and other instruments;
• production equipment.

Operation	Account debit	Account credit
Purchased equipment for installation	07	60 “Settlements with suppliers and contractors”
Reflects the expenses of the accountable person associated with the purchase of equipment for installation		71 “Settlements with accountable persons”
Equipment received as a contribution to the authorized capital		75 “Settlements with founders”
Received equipment for installation free of charge		98 “Deferred income”
The equipment has been handed over for installation	08	07
The book value of sold equipment is written off	91 “Other income and expenses”
The shortage of equipment for installation identified as a result of the inventory is reflected	94 “Shortages and losses from damage to valuables”

When a construction company uses equipment that requires preliminary installation and fastening to capital structures, accounting account 07 is used. The operation of such assets is expected at enterprise facilities being constructed or repaired. You cannot reflect on this account:

• vehicles;
• agricultural machines;
• complete complexes of machine tools;
• tools and equipment.

Characteristics of account 07

Development companies can receive equipment through acquisition, free receipt from third parties, or as a contribution from the founders to the authorized capital. A set of expenses associated with the purchase, delivery and storage, deductions for loans taken for the purchase of spare parts for this equipment are included in the cost of the asset and are taken into account in the debit of account 07.

Credit turnover is formed in the following cases:

• write-offs;
• transfer of the object for installation;
• sales;
• donation to third parties.

When considering the question of whether account 07 is active or passive, it should be taken into account that all expenses for bringing equipment to working condition are accumulated by debit. Accordingly, he is active. The generated debit balance at the end of the reporting period is transferred to the balance sheet asset, increasing the amount of fixed assets in line 1150. When an asset is transferred for installation, an act is created in OS form No. 15; if defects are identified during the installation process, it is necessary to draw up an act in OS form No. 16.

Account 07: receipt and disposal postings

Upon receipt and formation of the final cost of equipment that requires additional installation costs, the following entries are made:

• D07 – K60 when reflecting the price of an asset according to supplier documents;
• D07 – K23 when delivered on your own;
• D07 – K60, 76 when receiving delivery services from third parties;
• D07 – K15 when accepting equipment at discount prices;
• D07 – K66, 67 when calculating interest on loans issued for the purchase of equipment (short-term and long-term loans);
• account 07 of accounting is debited when crediting account 71 in case of reflection of the expenses of the accountable person related to the purchase of equipment;
• D07 – K75 in the amount of the cost of equipment contributed by the founders as a contribution to the authorized capital;
• D07 – K79 upon receipt of equipment from separate division or the head structure of the enterprise;
• D07 - K91.1 when capitalizing the surplus in the form of equipment identified during the inventory.

The transfer of an asset for installation is carried out by correspondence between debit and credit 07. The equipment account for installation is credited with the simultaneous debiting of account 94 in the event of write-off of an object that is unsuitable for installation and operation. When selling an asset before installation work or registering its gratuitous transfer, debit 91 is used.

Account 07 “Equipment for installation”: a case study

Case LLC purchased equipment worth RUR 1,416,000, including VAT RUR 216,000. Before starting operation, the purchased asset requires delivery and installation:

• the transport company delivered the equipment for 38,940 rubles, including VAT of 5,940 rubles;
• a third-party organization performed the installation work for RUB 145,140, ​​including VAT of RUB 22,140.

In accounting, account 07 is involved in the following transactions:

1. D07 – K60 in the amount of 1,200,000 rubles. at the time of recording the cost of purchased equipment.
2. D19 – K60 in the amount of input VAT 216,000 rubles.
3. D07 – K60 in the amount of the cost of the carrier company’s services 33,000 rubles.
4. D19 – K60 in the amount of input VAT 5,940 rubles.
5. D08.03 - K07 - drawn up when transferring an object for installation carried out by a third party, the amount is 1,233,000 rubles. (1,200,000+33,000).
6. D68 – K19 for 221,940 rubles. (216,000+5,940) when deducting VAT.
7. D08.03 – K60 for 123,000 rub. when recording installation services.
8. D19 – K60 for 22,140 rubles, taking into account incoming VAT from the installation organization.
9. D01 – K08.03 in the amount of 1,356,000 rubles. (1,233,000+123,000) at the time of equipment commissioning.
10. D68 – K19 in the amount of 22,140 is accepted for VAT deduction.

Account 07 in accounting is used to summarize data on the availability and movement of energy, technological, and production units. These include machines for workshops, laboratories, etc. The organization of accounting involves recording operations for units that require installation in objects being reconstructed (under construction). This article is used by development companies. Let's look at its features in more detail.

Object categories

Units that require installation include those that are put into operation only after assembling its parts and fastening them to the foundation or supports, to the floor, interfloor ceilings and others. load-bearing structures structures. This category of objects includes sets of spare parts for such equipment. The units also contain instrumentation and other equipment necessary for installation.

Exceptions

Accounting account 07 does not record:

1. Vehicles.
2. Free-standing machines.
3. Agricultural machines.
4. Construction mechanisms.
5. Production tool.
6. Measuring and other equipment, except for that with which the equipment is installed.
7. Production equipment.

The classification of accounts clearly separates articles to summarize this or that information. Thus, the costs of purchasing units that do not require installation are recorded on the account. 08 as they arrive at the warehouse or other storage location.

Organization of accounting

Units requiring installation are accepted on a debit basis. At the same time, their actual acquisition cost is recorded. It consists of purchase prices and costs of transporting objects to the enterprise’s warehouses. When purchasing units from individuals and enterprises for a fee, account 07 is debited in correspondence with the account. 60 and other similar ones. The receipt of objects can be reflected using an account. 15, registering operations for the procurement and receipt of material assets. If it is not applied, then the acquisition is reflected in a manner similar to that established for operations with materials. When accepting aggregates contributed by the founders on account of their contributions to the share (authorized) capital, account 07 is debited in correspondence with the account. 75.

Write-off

The classification of accounts provides for special items for recording the cost of units commissioned for installation. In particular, it applies to DB sch. 08, summarizing information on investments in non-current assets. At the same time, units delivered to the construction site that require installation are accepted by the contractor as off-balance sheet item 005. The cost of the equipment or its parts is deducted from it accordingly. If the installation of equipment transferred to the contractor at its permanent place of use has not actually begun, then its cost is not written off. In case of gratuitous transfer, sale and other similar operations of units to be installed, their price is transferred to DB. Account 91, reflecting other expenses and income. Analytical accounting by account. 07 is carried out by storage areas of objects and their individual names (brands, types, etc.).

Specifics of the article

Upon receipt of units that require subsequent installation, account 07 is debited and items that affect the price of the objects are credited. These include:

• Account 60 - according to settlements with contractors and suppliers.
• Account 76 - for transactions with various creditors/debtors and others.

The new Chart of Accounts explains that the receipt of aggregates can be reflected using an account. 15 or without it, but in the appropriate order. Only after the objects have been transferred for installation can the wiring be drawn up:

DB 08 Kd 07.

Explanations

For the company to switch to a scheme for reflecting expenses for receiving units through an account. 15, the feasibility of its use should be analyzed. Accounting for the costs of purchasing equipment intended for installation is carried out according to its specific types. This is necessary to determine the initial cost of fixed assets. Application of account 15 assumes that all expenses are divided by:

Deviations

They must be recorded separately on the account. 16 with further debiting of articles on which the corresponding objects are reflected. It becomes obvious that deviations in the price of equipment requiring installation under this scheme should also be recorded by type of material assets and transferred to the account. 08 at the time of transfer of units for installation. Restrictions on the formation of an assessment of equipment intended for installation, depending on the moment at which it was accepted, similar to the assessment of OS and intangible assets, it is permissible to determine not the average, but the actual cost.

Use of borrowed funds

The units can be purchased using a loan. In this case, the interest on it should form the assessment of the equipment until it is transferred for installation. Operations for accruing interest on bank loans that were received for the purchase of such objects should be reflected depending on the period of provision borrowed funds. The wiring looks like this:

Db 07 Kd 66 (67).

In the case of selling units, the following entries are made before installation:

To be written off: Db 91.2 Kd 07.

For the amount of the buyer's debt: Db 62 Kd 91.1.

As a result, according to 91, reflecting other expenses and income, the financial result from the sale of equipment will be revealed. This is due to the fact that the debit determines the cost of sold material assets, and the credit determines the amount received from the sale. In such cases, however, a loss may also arise.

Units transferred to the contractor

This situation should be considered separately. Equipment that is transferred to the contractor for installation does not become his property. It remains in the legal possession of the customer. In this regard, the contractor debits not account 07, but off-balance sheet item 005, reflecting the movement of material assets accepted for installation. It is credited upon direct transfer of objects for their intended purpose.

Additionally

During the inventory, a shortage of units that were accounted for in account 07 may be revealed. In such situations, the item is credited. In this case, the account is debited. 94, reflecting losses and shortages from damage to material assets. The accountant can immediately use the account. 99 showing losses and profits. This is advisable in case of loss of units intended for installation due to emergency circumstances economic activity. The latter, for example, include nationalization, accident, fire, natural disaster, and so on.