ABSTRACT: (PROCUREMENT CONTRACTS WITH DURATIONS EXCEEDING ONE YEAR. CIVIL AND TAX ANALYSIS). This publication aims to analyse procurement contracts (with durations exceeding 12 months) and in particular to define when the contractor is entitled to payment of the agreed amount for the implementation of the work, and when such amount can be considered definitely settled. Under Italian law, where the client is a public body, the payment shall be deemed definitely settled with the approval of the work test report. Where the client is a private body, the payment shall be deemed definitely settled when there is the test report or at least acceptance of the work by the client, not taking into account advance payments during the work or the simple delivery of the work. The criteria for evaluating ongoing works with durations exceeding 12 months are then analysed, both with regard to civil and tax aspects, and, as per Italian tax law, a single criterion is highlighted for evaluating ongoing work at year-end: the criterion of accrued payment. Finally, it is taken into consideration whether the mathematical formula used to determine the cost of sales (opening inventory plus purchases minus closing inventory) can also be used for determining the cost of sales in the presence of long-term contracts. This leads to the conclusion that it is incorrect to calculate the cost of sales of ongoing work to order on the basis of inventories valued as required by Italian tax law.
KEYWORDS: ongoing work, contract durations exceeding one year, cost of sales.
Castelli, S. (2015). Contratti di appalto con durata di esecuzione ultrannuale. Analisi civilistica e fiscale, RIREA, n.2, pp. 215-222.
