Development Costs - First Time adoption IAS38

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Gman
Posts: 9
Joined: 28 Oct 2021, 15:23

Development Costs - First Time adoption IAS38

Post by Gman »

Hi,
Getting confliction reports on the below query.

Moving to IFRS from FRS 102

Previously all development costs were expenses.
01/01/2021 is the date of transition to IFRS.

At that date do we retrospectively review what the development costs would have been up to that point, if IFRS was always in place.
i.e do we do an initial capitalization of development costs on 01/01/21.

Or is it only looking forward from that point?

as always many thanks for all the input
G
JRSB
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Joined: 01 Mar 2020, 01:10
Location: UK

Re: Development Costs - First Time adoption IAS38

Post by JRSB »

you can go back but you have to have the documentation in place, at the time, about what was R and what was D, and that the list of requirements to capitalise were met and recorded at the time. IN practice they probably weren't.
Leo
Posts: 908
Joined: 05 Apr 2020, 22:31

Re: Development Costs - First Time adoption IAS38

Post by Leo »

Totally agree with JRSB.

If you want to publish FY2021 in IFRS, your transition date might be 01/01/2020 ?

Our company faced the same problematic, and we prepared all the documentation starting on the date of transition, and capitalised everything at the date of the transition. You might present your position to the auditors and get their feedbacks first.
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