When certain kinds of assets are built that require public welfare and safety expenditures at the end of the asset's life,

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When certain assets are built that require public welfare and safety expenditures at the end of the asset's life, a liability simultaneously arises. This liability is estimated based on the costs that will be incurred to retire the asset and remediate any damage caused by the asset. This liability needs to be recognized in the financial statements to provide a complete picture of the entity's financial position.

When Certain Kinds of Assets Are Built That Require Public