When estimating landfill closure and postclosure care costs, which statement is FALSE?

The statement that the annual estimate of costs should be based upon their anticipated net present value is indeed false. The proper approach to estimating closure and postclosure care costs for a landfill involves calculating these costs as they are expected to be incurred over time, without discounting them to present value.

The closure costs do not just include charges incurred at the end of the landfill’s operating life; they encompass costs that are associated with both closure activities and postclosure care, which can span several years after the landfill has stopped accepting waste. The allocation of total estimated costs across different periods is critical for accurately capturing the costs associated with a landfill over its entire operational life.

Furthermore, allocation of costs being based on landfill usage rather than time is more appropriate because it allows for a more accurate reflection of how the disposal capacity is utilized relative to the associated costs being incurred. This method ensures that the financial estimates are closely aligned with actual landfill use, helping to manage and estimate the financial liabilities involved in landfill management more effectively.