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IAS 23 - Coggle Diagram
IAS 23
SUSPEND CAPITALISATION
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don't suspend when:
- tech & admin work is carried out
- temporary delay is part of the process
Key Qs:
- is interruption under entity's control?
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- is interruption unexpected?
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NB! COVID impact
"extended period considerations"
- delay length relative to time period ordinarily
expected for construction
- how far the entity was into construction by lockdown
- post-lockdown period further extends or phased approach allows some construction
- non-development caused fin distress, retrenchments happened & may not be able to recommence
- conditions & lockdown restrictions weren't part of process in getting (A) into intended use
- also not common to construction period of (A) - we didnt know @ the beg. of a project that covid would shut down ops
Effect of changed Repo Rate or Loan terms
- effective interest rate may change, recompute &
adjust rate of capitalisation
- negotiating revised terms would change amts
to be capitalised
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DEFERRED TAX
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Other (A)s: Incl in CA ito IFRS.
SARS doesn't incl, deduct under s24J rather.
Wear + Tear only available when (A) is used
Temp diff arises
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