Capex Form

Instructions for use

This form must be completed prior to purchasing or placing a Purchase Order for any capital expenditure (CapEx) on behalf of the business.

When do I need to use this form?

Complete this form if you wish to make, or have been verbally or otherwise asked to make, a capital expenditure purchase on behalf of the business.

Even if management has asked you to make the purchase, this form still needs to be completed before placing any purchase orders.

What qualifies as CapEx?

Whilst we do not currently have a strict numerical limit, capital expenditure tends to be higher-value expenditure that will have an economic benefit to the company over multiple years. As a general rule, capital expenditure would be over £1,000.

This can include a single purchase for plant or equipment, such as a new vehicle or tractor. It could also include multiple purchases from one or more suppliers where the combined spend creates a discrete, identifiable asset.

Any cost associated with procuring, creating and commissioning the asset can be capitalised as part of the cost of the asset.

What doesn't qualify as CapEx?

Repairs and maintenance to existing equipment or infrastructure that return them to a usable state do not classify as capital expenditure. For example, repairing a broken-down van to its original state would be expensed as a vehicle repair.

Expenditure can only be capitalised where it can be demonstrated that it significantly extends the life of an asset or increases the functionality of an existing asset.

If you remain unsure, speak to the Finance Team for clarification before filling out this form.

When should I not use this form?

Only complete this form when the required expenditure meets the definition of capital expenditure outlined above.

If it does not meet that definition, raise a Purchase Order for approval in the normal manner and code it to an appropriate nominal code.

What happens once the form is submitted?

The Finance Team will review the submitted form and check that it meets the criteria for capital expenditure. If it does, the form will be circulated for approval by the Managing Director and, when required based on value, the Board of Directors.

Once approved, Finance will assign the project a CapEx Number, add it to Zahara and email it to the person who submitted the form. You can then raise the necessary POs in Zahara.

If the request does not meet the definition of capital expenditure, the Finance Team will let you know. You will then need to raise POs against suitable nominal codes so the cost is classified and expensed correctly in the P&L.