5 April 2000 Internal T.I. 1999-0015087 - CONSTRUCTION CONTRACTORS -- summary under Subsection 181.2(3)

"Amounts billed by a subcontractor that are subject to a holdback requirement constitute a contingent liability of the contractor, and generally would be included in the contractor's capital as a reserve. Once the subcontractor's work that is the subject of the billing is certified, the amount owing by the contractor in respect of the certified work constitutes a legal liability of the contractor, and would be included in the contractor's capital as indebtedness, if the amount has had the character of indebtedness for more than 365 days at the end of the taxation year."