Property

All topics related to IFRS Standards.
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Asnake E
Posts: 213
Joined: 02 Oct 2019, 03:28

Property

Post by Asnake E »

Hi,

Assume a company engaging in a restaurant business rents the premise to be used for the restaurant and incurred huge amount to redesign and furnish the premise to use as a restaurant.
My question: can the company capitalise the cost of furnishing the rented premise?
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exIFRS
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Joined: 01 Mar 2020, 08:44
Location: London

Re: Property

Post by exIFRS »

Yes absolutely. This is simply PPE, which we often term leasehold improvements.

There was a recent IFRIC related to these kinds of costs and specifically the period over which to depreciate them:

https://www.ifrs.org/content/dam/ifrs/s ... ements.pdf
Asnake E
Posts: 213
Joined: 02 Oct 2019, 03:28

Re: Property

Post by Asnake E »

Thank you. Very much appreciated.
JRSB
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Location: UK

Re: Property

Post by JRSB »

Interesting that the existence of a long-life leasehold non-moveable improvement is essentially a factor in the 'broader economics' phrase. All seems to align with common sense though, happily.
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