Treatment of Storage Costs
Can someone advice the correct treatment of the below case under IFRS.
A company is trading in Fuel Oil. It purchases fuel oil, stores it in tanks and sells it.
As a result it incurs fuel costs and also storage costs (tank rentals).
In a particular transaction, the company purchased fuel oil in Dec 2008 and stored it in tanks hired particularly for this transaction and sold the fuel in Jan 2009.
The question is on the treatment of the storage costs (tank rentals) of the particular tank for the month of Dec 08.
Option 1 : The tank rental is a cost to sell as the purchase leg is complete when the fuel oil
hits the tank and the fuel oil is stored only for the purpose of sale. Also because the tank rental has already been incurred, it has to be treated as expenses in 2008 though the sale of fuel occurs only in 2009.
Option 2 : The tank rental is paid to store fuel oil and is easily identified to the inventory that is meant for sale and hence should be part of inventory cost and should be shown under Inventory in Balance sheet.
Option 3 : The tank rental is cost to sell as it is stored only for the purpose of sale. As the sale occurs only in 2009, and as the tank rental is easily identifiable to the particular sale, the tank rental should be considered under deferred costs in Balance sheet as of 2008 and should not be considered in PNL in 2008. It should be part of 2009 costs and is matched to the sales revenue in 2009.
Request your opinion on which option is the correct treatment of the tank rental under IFRS.
Please provide documentary evidence like extracts of accounting standards, if available.