Assets Under Construction Accounting Treatment is a financial concept that refers to when a business incurs costs for preparing and constructing an asset. This process recognizes the expenditures of resources and labor as part of the cost of creating the asset. When it comes to construction projects, this accounting treatment involves tracking the progress made from start to finish. It’s essential to account for all changes in value during the construction process like labor hours, materials, contracts, and permits in order to record these expenses properly. By tracking all aspects of the project’s production, businesses can have a better understanding of their overall performance and can take action accordingly.