Restructuring provision: Closure of the Plessac site

Context

Brisandor Textiles SA (a fictitious entity) weaves technical fabrics on two sites. To concentrate its production, it has decided to close its Plessac weaving plant and to transfer part of the activity to its Mérange site; a reorganisation of its sales network in Iberia has also been decided. You are preparing the financial statements for the year ended 31 December 20X3, authorised on 20 February 20X4.

Assignment

Restructuring provision workpaper (Plessac, Iberia).

Purpose of the workpaper

Check that the programme meets the definition of a restructuring and that a constructive obligation exists at the reporting date (detailed formal plan, valid expectation raised in those affected), sort the eligible direct expenditures from the excluded costs, calculate the provision, record the entry and pass the items of the note.

Questions of the file covered by this workpaper

• Are the Plessac and Iberian projects restructurings within the meaning of IAS 37?
• Is there a constructive obligation to restructure at 31 December 20X3 for each project?
• Classify each cost in the finance department's schedule: eligible expenditure or excluded cost.
• Calculate the restructuring provision at 31 December 20X3.
• Record the entry at 31 December 20X3.

• MinutesMinutes of the board of directors' meetingOpen
• DocumentPress release and letters to those affectedOpen
• ScheduleSchedule of closure costsOpen
• MemoReal estate department memoOpen
• MinutesMinutes of the executive committee meeting (Iberia)Open
• ExtractExtract from the group's strategic planOpen