02-14-2010, 04:39 PM
Dears
IAS 23 requires to capitalize the costs directly attributable to the acquisition of the asset. (qualifying asset).
IAS 17 requires to recognize the assets subject to finance lease on PV of MLP (other option not intended to be discussed)....
One thing is clear that there is no apparent contradiction between two as the asset subject to finance lease does not fulfills the definition critaria of 'Qualifying asset'.
But what is the rationale of not capitalizing finance charge associated with lease, as it is also un-avoidable directly attibutable cost incurred solely due to acquisition of that asset.
Regards
Ahmed
IAS 23 requires to capitalize the costs directly attributable to the acquisition of the asset. (qualifying asset).
IAS 17 requires to recognize the assets subject to finance lease on PV of MLP (other option not intended to be discussed)....
One thing is clear that there is no apparent contradiction between two as the asset subject to finance lease does not fulfills the definition critaria of 'Qualifying asset'.
But what is the rationale of not capitalizing finance charge associated with lease, as it is also un-avoidable directly attibutable cost incurred solely due to acquisition of that asset.
Regards
Ahmed
