ias 16 PPE
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- Posts: 3
- Joined: 18 Nov 2021, 21:55
ias 16 PPE
I am trying to get a better understanding of what is acceptable as "professional fees" when capitalizing against the asset. In particular when purchasing buildings as PPE, can we capitalize a valuation before purchase?
Re: ias 16 PPE
that's grey area to me, if you're doing a valuation, it means that you haven't decided yet whether to buy or not, so it's more like a research before buying than 'costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management'
see also here:
https://ifrscommunity.com/knowledge-bas ... onstructed
see also here:
https://ifrscommunity.com/knowledge-bas ... onstructed
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- Posts: 3
- Joined: 18 Nov 2021, 21:55
Re: ias 16 PPE
Hi Marek
i tend to agree with but if anyone has direct experience of how this expenditure was treated, I would love to hear
i tend to agree with but if anyone has direct experience of how this expenditure was treated, I would love to hear
Re: ias 16 PPE
I wonder if it helps to know the purpose of the valuation. some requirement of a purchase/lending agreement , or as project appraisal? I'd probably agree with MM that it doesn't seem to fit the definition but that doesn't mean in practice people don't put all sorts of surveys, introduction fees, project fees , etc
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- Posts: 3
- Joined: 18 Nov 2021, 21:55
Re: ias 16 PPE
yep i think you are correct JRSB and i think it will be a low expense compared to purchase of building usually so goes a bit unnoticed