BORROWING COSTS

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IAS 23 – Borrowing Costs

List of useful info, resources and documents available on other websites about IAS 23 – Borrowing Costs. Summary of IAS 23 – IASPlus Full Text of the IAS 23 as at 31 December 2010 provided by IASB (You need to register) Other useful … Cont...

By |December 27th, 2011|DOCUMENTS, IAS 23, IAS 23 Borrowing Costs|Comments Off on IAS 23 – Borrowing Costs

Loss on interest rate swap can be capitalized?

For development of qualifying assets we took a loan from bank, as per ias 23, interest cost on loan taken for qualifying assets will be capitalized to those assets, as per the loan agreement interest rate was libor+1.5, initially libor was high so to c...

By |November 23rd, 2009|DOCUMENTS, FINANCIAL INSTRUMENTS, IAS 23|7 Comments

Borrowing Cost

Hello I Have  A question if i have more than a qualify asset at the same time (say 4) and i only have one loan how i captilize the interest for each asset (give Examples )as they are all at the same time and they are all different??

By |November 21st, 2009|IAS 23|2 Comments

IAS 23 – Borrowing cost capitalization

Dear Experts, I would like to request for your opinion on IAS 23 Funds Borrowed $100 for construction projects Int @5% p.a. Out of above $100, kept in bank fixed deposits $80 and balance utilized for construction projects. Later on further $40 paid from FD for Construction projects. Interest on $100 accounted as interest expense [...]

By |March 22nd, 2009|OTHER IFRS|3 Comments

Borrowing Costs

Under IAS 23 Borrowing Costs, we are required to capitalize borrowing costs directly attributable to qualifying assets. Qualifying assets are defined as those that necessarily take a "substantial period of time" to get ready for use. Can anyone help with any rule of thumb or standard practices regarding how long a "substantial period of time" [...]

By |December 14th, 2008|IFRS|0 Comments

IAS 23 Borrowing costs – Interest-free loans

As per IAS 23, borrowing costs on qualifying assets should be capitalised: To the extent that an entity borrows funds generally and uses them for the purpose of obtaining a qualifying asset, the entity shall determine the amount of borrowing costs eligible for capitalisation by applying a capitalisation rate to the expenditures on that asset. The capitalisation rate shall be the weighted average of the borrowing costs applicable to the borrowings of the entity that are outstanding during the period. What if a company has interest free loans from shareholders in addition to interest-bearing loans from financial institutions? Do you take into account the effective interest income due to the interest-free loan (effectively lowering the WACC)? This is quite common as banks often only finances a construction project partially, and the rest of the funds are added by shareholders. Your feedback would be must appreciated! Best regards                 […]

By |August 28th, 2008|OTHER IFRS|0 Comments

IAS 23 Borrowing costs – Interest-free loans

As per IAS 23, borrowing costs on qualifying assets should be capitalised: To the extent that an entity borrows funds generally and uses them for the purpose of obtaining a qualifying asset, the entity shall determine the amount of borrowing costs eligible for capitalisation by applying a capitalisation rate to the expenditures on that asset. The capitalisation rate shall be the weighted average of the borrowing costs applicable to the borrowings of the entity that are outstanding during the period. What if a company has interest free loans from shareholders in addition to interest-bearing loans from financial institutions? Do you take into account the effective interest income due to the interest-free loan (effectively lowering the WACC)? This is quite common as banks often only finances a construction project partially, and the rest of the funds are added by shareholders. Your feedback would be must appreciated! Best regards                Allan […]

By |August 28th, 2008|OTHER IFRS|0 Comments

IAS 23 Borrowing costs – Forex differences

If the entity’s policy is to capitalise borrowing costs and obtains a foreign loan probably taking advantage of the lower interest rates, any exchange differences should be capitalised as will during the period of construction of the qualifying asset. Regards, Nyasha […]

By |August 28th, 2008|IFRS, OTHER IFRS|0 Comments

IAS 23 Borrowing costs – Forex diffrences

As per the amended IAS 23, all borrowing costs on qualifying assets should be capitalised (no option to expense). Does exchange differences on foreign currency loans qualify as borrowing costs to be capitalised? Best regards Allan Hi Allan To my understanding any positive/negative FX difference is expensed directly to the P&L. Regards, Marc The change to [...]

By |August 28th, 2008|IFRS|1 Comment

Software capitalization

Hello, Does anyone know where the best place to find information on capitalizing internal software development under IFRS?  Any links?  Which IAS/IFRS standard is this covered under? Thanks in advance for the help! You raise an interest topic David,  I would like to see the view of others In the meantime page 56 of the [...]

By |August 28th, 2008|IFRS|0 Comments