capital expenditures

Capital Expenditures The normal and necessary costs incurred to bring an item of property, plant or equipment to its condition for its intended use; These amounts are included in the asset account

Capital expenditure (CAPEX) represents funds used to acquire or improve long-term assets that generate future economic benefits.

- Used in the purchase-to-pay cycle to validate invoices, approvals, and supporting documents.
- Used to strengthen internal controls over purchasing and supplier payments.

- Example: Before payment, the AP team applies **capital expenditures** to confirm the invoice matches the approved purchase documentation.

- Why it matters: Prevents incorrect/duplicate payments, reduces fraud risk, and improves accuracy of payables and expenses.