# Expenses and Income

Vault Owners and Admins can track capitalised expenses and deferred income.

## Capitalised Expenses

Capitalised expenses let you record and amortize significant operating costs over a defined period, ensuring accurate accounting within the Vault’s valuation.

{% hint style="success" %}
*Example*<br>

* *The Vault has operating expenses of **10k USD** for audit costs per year.*
* *This expense can be added as a **capitalised expense item** with a write-down period (e.g., Jan 1 until Dec 31, 2025).*
* *Whenever (partial) payments of an expense item are made, the **paid amount** needs to be tracked.*
* *The Vault’s valuation module will automatically calculate the correct accounting value of all expense items whenever a valuation update is made, taking into account both the **pro rata write-down** of the capitalised expense and the **payments already made**.*
  {% endhint %}

## Deferred Income

Deferred income lets you spread guaranteed revenue over a defined period, ensuring it is recognized gradually in the Vault’s valuation.

{% hint style="success" %}
*Example*

* *The vault has guaranteed income of **USD 10k** for the year.*
* *This income can be added as a **deferred income item** with a write-up period (e.g., Jan 1 to Dec 31, 2025).*
* *Whenever (partial) payments of the income item are received, the **amount received** must be tracked.*
* *The vault’s valuation module will automatically calculate the correct accounting value of all income items whenever a valuation update is made, taking into account both the **pro rata write-up** of the deferred income and the payments already received.*
  {% endhint %}


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