The treatment of capital costs Capital expenditure, as noted in Section 2.3, is expenditure incurred on items that, once bought, provide benefits that last beyond the accounting year within which they were bought. The main items of capital expenditure are buildings, furniture and equipment. Very small pieces of equipment with a useful life of years - for example, a stapler or a hole-punch - cost so little that they are conventionally treated as consumables, but in general items that have an expected lifetime of more than one year are treated as capital costs; those with an expected lifetime (ie period of use) of less than one year are treated as recurrent costs.