Xref: utzoo comp.cog-eng:414 comp.software-eng:127 comp.edu:822
Newsgroups: comp.cog-eng,comp.software-eng,comp.edu
Path: utzoo!lsuc!dave
From: dave@lsuc.uucp (David Sherman)
Subject: Re: Offices versus Cubicles (LONG)
Date: Wed, 27-Jan-88 09:22:03 EST
Summary: building real offices can be pretty expensive
Message-ID: <1988Jan27.092204.22702@lsuc.uucp>
References: <2058@pdn.UUCP> <82@sickkids.UUCP>
Organization: Law Society of Upper Canada, Toronto

In article <82@sickkids.UUCP>, mark@sickkids.UUCP (Mark Bartelt) writes:
> What has always mystified me, though, is why companies buy these things.
> Most of the arguments made on their behalf are clearly spurious:  As an
> example, it's often claimed that they're more space-efficient.  Nonsense.

Well, offices the size of your stalls, with walls up to the ceiling,
would be pretty claustrophobic.  Your other points are reasonable,
though.

> So, back to the question of *why* do most companies do this to their
> people?  The stalls are not cheap.  In fact, the sort we have cost in
> the multiple hundreds of dollars per panel, and quite a few panels are
> need to make a stall.  And there are nine stalls, plus the tenth one
> that serves as a five-person meeting room.  Installing drywall walls,
> and putting in a door to each office, and painting the walls, and the
> various minor amount of extra electrical work that would have been
> needed would have cost far less than the barnstalls did.

Are you sure? Have you priced contractors' work recently?
The costs of commercial electrical, construction, painting,
etc. are astronomical. (It cost the Law Society over $100,000
to renovate a single classroom recently.)  Also, if the company
moves, the stall dividers can usually be taken with them.

> I was finally given some insight as to why, by someone from the company
> that sold us these things:  Tax reasons.  Apparently, the barnstalls are
> considered office furnishings, provided that they are free standing and
> don't connect to the ceiling.  And office furniture can be depreciated
> quickly.  Not true for money spent putting up drywall.  So, there you
> are:  The beancounters strike again.  Sigh.
> 
> Actually, since neither I nor the company representative who told me
> this are tax experts, perhaps somebody who is could confirm or deny the
> truth of this claim.  (Dave Sherman, are you out there?)

Yo.  (Thank sq!msb for referring this to me, actually.)
Office furniture is usually written off at 20% declining balance,
but if it's devoted to R&D it may be possible to write it off
fully in the year it's acquired. (I've just glanced at the Income
Tax Act and Regulations provisions on this; a definitive answer
would require more extensive research and discussion as to the exact
nature of the expenses and the activities carried on.)  Renovations
would normally be leashold improvements, which can often be written off
over 5 years straight-line.  So yes, there may be tax advantages.

In your case, Mark, that may not be definitive.  The hospital
doesn't pay tax.  And the research corporation it owns would only
be paying tax if it's profitable.

> Mark Bartelt
> Hospital for Sick Children
> Toronto

David Sherman
The Law Society of Upper Canada
Toronto
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