IAS 23 · Workpapers (Step 4 of 5)
Workpaper assignment
- Course
- Exercises
- Case studies
- Workpapers
- Exams
Specific borrowing inclusion file
Five assets: qualifying or not, interest expensed or included
Section 1 of 9
Objective
Section brief
- What to document
- The engagement, its scope and the working mode chosen.
- Why
- A workpaper answers one precise question: framing it avoids off-topic work.
- How
- Read the objective and the assignment, then choose the mode (guided, semi-guided, professional).
- Expected result
- You know which question the workpaper must settle, and for which reporting date.
- Your role
- Preparer of the IAS 23 workpaper
- Level
- Foundation
- Estimated time
- ≈ 50 min
- Progress
- 0 / 5 steps done (review excluded)
Context
Chantiers Marenval SA (fictitious entity) closes its books on 31 December 20X5. It finances five assets in part by borrowing and must decide, for each of them, whether the borrowing costs are included in its cost or expensed.
Assignment
Loan file of asset 5
Purpose of the workpaper
For each borrowing (one instance per borrowing), describe the loan and the asset, state whether a qualifying asset exists, enter the principal, the rate for the period (annual effective rate multiplied by the fraction of the period) and the unspent funds temporarily invested, then compute the actual costs, the investment income, the eligible costs and the costs to be expensed. The effective rate is a datum of the file (the effective interest method of IFRS 9 is not covered here).
Questions of the file covered by this workpaper
- Compute the actual borrowing costs of asset 5.
- Compute the borrowing costs of asset 5 to be expensed.
- Record the borrowing costs of asset 5.
Documents in the file
Open the documents to pick out the relevant information.