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Borrowing cost

12 April 2010 2,166 views 5 Comments

When arranging a long term loan mortgage fees are paid. Are these fees to be considered as ancillary borrowing cost and should be included in calculation of the effective interest rate?

Thanks,

Ilian Dimitrov Gotzev

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5 Comments »

  • ifrslist
    ifrslist said:

    [New Post] Borrowing cost – http://www.ifrslist.com/2010/04/borrowin...
    via Twitoaster

    # 12 April 2010 at 8:45 am
  • IFRS List.com: Borrowing cost — Accounting Blog said:

    [...] admin wrote an interesting post today. Here’s a quick excerptWelcome to IFRSLIST.com, the free community where you can find resources, share experience, knowledge and ideas about IFRS, bAccounting/b and Auditing with more than 1.5k members. Sign-up and start a new discussion. … [...]

    # 12 April 2010 at 10:03 am
  • Wallace Consulting Group said:

    Sure, if they are directly attributable to raising the financing

    # 12 April 2010 at 11:50 pm
  • Dmitriy said:

    Undoubtedly, following the requirements of IAS 39 and IAS 1 (look the definition of an asset) such kind of expenditures is directly connected with cost of financing and must be taken into account in calcutaltion the effective interest rate and recognized in the appropriate way.

    # 13 April 2010 at 12:57 am
  • s d mookerjea said:

    The mortgage fees reduces the net inflow of long term loan and hence needs to be factored in for effective interest rate computation

    # 17 April 2010 at 9:37 am

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