IFRS - IAS 23 Borrowing Costs

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• expenditures

• actual borrowing costs incurred on that borrowing during the period less any investment income on the temporary investment of those borrowings

• interest and other costs that an entity incurs in connection with the borrowing of funds

• directly attributable to the acquisition, construction or production of a qualifying asset form part of the cost of that asset

• asset that necessarily takes a substantial period of time to get ready for its intended use or sale

• capitalise borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. An entity shall recognise other borrowing costs as an expense in the period in which it incurs

• capitalisation rate shall be the weighted average of the borrowing costs applicable to all borrowings of the entity that are outstanding during the period

• borrowing costs

• prepare the asset for its intended use or sale

• suspend capitalisation of borrowing costs during extended periods in which it suspends active development of a qualifying asset

• cease capitalising borrowing costs when substantially all the activities necessary to prepare the qualifying asset for its intended use or sale are complete

• When an entity completes the construction of a qualifying asset in parts and each part is capable of being used while construction continues on other parts

• 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 all borrowings of the entity that are outstanding during the period. However, an entity shall exclude from this calculation borrowing costs applicable to borrowings made specifically for the purpose of obtaining a qualifying asset until substantially all the activities necessary to prepare that asset for its intended use or sale are complete. The amount of borrowing costs that an entity capitalises during a period shall not exceed the amount of borrowing costs it incurred during that period.