From the accountant's standpoint, there are few accounts on the books which require more careful examination than the Improvements or Betterments account - a condition applying equally to all businesses in which the maintenance of any physical structure plays a part. There is frequently considerable difficulty in drawing the line between the expense item of repairs or renewals and the asset item of improvements or betterments. This difficulty is still increased by the general tendency among officials of all ranks to increase assets rather than expenses. The clerk in charge of a rental department is as desirous of keeping low his ratio of repairs to rents, as is the manager reporting to the stockholders; whereas the stockholders themselves would, sometimes at least, charge everything to assets and nothing to repairs, for by so doing these asset increments might be quickly turned into dividends and in this form reach their pockets.

If a list were made, commencing with undoubted improvements and gradually changing to undoubted repairs, nothing would be easier than to classify the items at each end of the list, while it would be extremely difficult to classify properly some of the items in the middle. The building of a new house on a vacant lot or the digging of a drainage canal through a swamp are beyond all doubt "improvements," while the replacing of a pane of window glass blown out by the wind is clearly "repairs." The difficulty in classification is not merely that of finding a definition, but of applying the definition when found. The final decision in each case must necessarily depend upon the conditions.