11-15-2011, 08:47 PM
Dear sir/madam,
I am a student whoâs doing a graduation project at a manufacturing company. My assignment is to do a research to the possibilities to reduce costs within a technical warehouse.
I have a question regarding the IFRS. The financial course of the company is based on the IFRS. During my research I discovered some strange things of which I am not sure they do it the right way. For example, in case a high value spare part of an asset gets deficient, it will be replaced.
Because it is considered to be the most cost efficient, deficient high value spare parts will be repaired. Once the deficient product is repaired, it will be placed in stock again. I would like to know what kind of value the repaired part should have. Since it is already paid, I assume you can put it back in stock for a value of 0 euro. But somehow I have my doubts about this journal entry because the repaired part has a value again. I cannot find any specific guidelines in the IFRS for revaluating repaired spare parts, which are not part of your asset.
Should the value of the repaired part be based on the costs to repair the product, a value of 1.000 since it is the old price or can you give the repaired part a value of 0 euro since it is already paid?
I hope you know the awnser to my question.
Many thanks in advance.
Kind regards,
I am a student whoâs doing a graduation project at a manufacturing company. My assignment is to do a research to the possibilities to reduce costs within a technical warehouse.
I have a question regarding the IFRS. The financial course of the company is based on the IFRS. During my research I discovered some strange things of which I am not sure they do it the right way. For example, in case a high value spare part of an asset gets deficient, it will be replaced.
Because it is considered to be the most cost efficient, deficient high value spare parts will be repaired. Once the deficient product is repaired, it will be placed in stock again. I would like to know what kind of value the repaired part should have. Since it is already paid, I assume you can put it back in stock for a value of 0 euro. But somehow I have my doubts about this journal entry because the repaired part has a value again. I cannot find any specific guidelines in the IFRS for revaluating repaired spare parts, which are not part of your asset.
Should the value of the repaired part be based on the costs to repair the product, a value of 1.000 since it is the old price or can you give the repaired part a value of 0 euro since it is already paid?
I hope you know the awnser to my question.
Many thanks in advance.
Kind regards,
