Final answer:
Decommissioning provisions are presented as a liability on the balance sheet under long-term liabilities. They represent estimated costs for decommissioning nuclear power plants or other long-lived assets.
Step-by-step explanation:
In financial statements, decommissioning provisions are presented as a liability on the balance sheet. They are disclosed as a separate line item under the long-term liabilities section. The purpose of these provisions is to account for the estimated costs of decommissioning activities associated with a nuclear power plant or other long-lived assets.
Decommissioning provisions are often measured using estimates of future costs, such as the removal and disposal of nuclear waste, decontamination of the site, and restoration of the environment. These estimates are based on current rules and regulations, technological advancements, and industry standards.
It's important to note that decommissioning provisions are subject to change over time due to factors such as changes in regulations or cost estimates. Therefore, they are re-evaluated and updated periodically to reflect the most current information.
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