Interpreting Indonesian Financial Accounting Standards (PSAK) No. 216: Capitalization of Costs in Building Fixed Asset

Abstract

This study analyzes the implementation of Indonesian Accounting Standard (PSAK) No. 216
concerning fixed asset cost capitalization, specifically focusing on office buildings at PT PPA,
a company managing airport office facilities. This research employed a qualitative approach
using interviews, observations, and fixed asset document analysis. Data was analyzed through
the Miles and Huberman model, which involved collection, reduction, display, and conclusion
drawing. Findings reveal that the company applies capitalization costs for building fixed asset
in line with Indonesian accounting standards. The company ensures consistency in classifying
development expenses as capitalized items. Best practices identified strengthen compliance and
enhance the accuracy of financial reporting. Theoretically, the study enriches the application of
capitalization standards in infrastructure-related industries. Practically, it offers guidance for
companies to improve asset management and reporting transparency. The novelty lies in its
focus on cost capitalization practices within airport office facility management, an area rarely
examined in previous studies.