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Provide a list of the departments that you determined to be mixed service departments.
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Provide a description of the functions performed in each of the departments you identified as mixed service departments.
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Provide a job description of all the employees in the departments you identified as a mixed service departments.
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For each mixed service department, provide a schedule of the costs that you determined were incurred by that department.
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Identify and provide the computations on how the costs associated with the mixed service departments were allocated between production of self-constructed assets (capitalizable production activities) and deductible activities (non-production activities).
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Provide a detailed description of the production and non-production activities within each department that you identified as a mixed service department.
NOTE: Once the audit team has obtained the job descriptions, it is recommended that the following audit techniques be used:
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Request and review detailed timesheet data.
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Conduct interviews of the personnel in these departments.
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Request project identification/work order summaries.
All this data should be examined to determine if the costs incurred by these departments include:
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Direct production costs (both material and labor), or
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Clearly capitalizable service costs, and/or,
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Clearly deductible service costs which are not mixed service costs as defined in § 1.263A-1(e)(4)(ii)(C).
If it is determined that the departments do not support both production and non-production activities, then they are not mixed service departments. They are either capitalizable or deductible service departments.
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