Construction Industry Scheme (CIS) Under the Construction Industry Scheme (CIS), contractors deduct money from a subcontractorâs payments and pass it to HM Revenue and Customs (HMRC). The deductions count as advance payments towards the subcontractorâs tax and National Insurance. Contractors must register for the scheme.
Depreciation and Amortization. Not all G&A expenses represent cash leaving the company. Depreciation and amortization expenses are a result of the matching principle of accounting. This principle tells us that we should match the costs of producing revenue to the period when the revenue is produced.
1 The operating activities section starts with the net income of $280 for the six-month period. 2  Depreciation expense is added back to net income because it was a noncash transaction (net income was reduced, but there was no cash spent on depreciation).o do this, we add back the amount of the Depreciation Expense. Depletion Expense and Amortization Expense are accounts similar to Depreciation Expense, as all three involve allocating the cost of a long-term asset to an expense over the useful life of the asset.