Septiembre 2011

Property, plant and equipment, intangible assets and investment property

Property, plant and equipment and intangible assets are recognised initially at acquisition or production cost.
Investment property is measured in the same way.


Research expenditure may be capitalised if the same
requirements as those established for the capitalisation of development expenditure are met, and it is amortised over
its useful life (maximum of five years).
Development costs are capitalised if the related requirements are met and they are amortised over their useful life (presumed to be a maximum of five years if there is no evidence to the contrary).
Under IFRSs property, plant and equipment, intangible assets and investment property may be measured using the revaluation model.
The revaluation model may only be used for intangible assets in the restricted and uncommon case of the intangible assets having a quoted market price in an active market.
There is a difference in the case of research costs, since under IFRSs they are charged to expense when incurred.
Also, for neither case do IFRSs establish a time limit for the amortisation period, which will be the useful life of the related assets.

Capitalisation of borrowing costs

Such finance income as might arise from the investment of the borrowings obtained for the acquisition, production or construction of a non-current asset (or, where appropriate,
inventories) must be recognised in profit or loss and the borrowing costs incurred during this period must not be capitalised.
Under IFRSs any income earned on the temporary investment of these funds until their expenditure on the acquisition or construction of the asset must be deducted from the total borrowing costs to be capitalised.