IAS 38Chapter 7Lesson 1
Expenditure always recognised as an expense
Step 1 of 7Learning objectives
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Start-up, training, advertising, catalogues, relocation, reorganisation: this expenditure prepares the future but creates no asset in the statement of financial position. You will learn the IAS 38 principle (expenditure on an intangible item is an expense, save for exceptions), the list of typical expenditure, the exact date on which the expense is recognised (access to goods, receipt of services) and the treatment of prepayments.
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Learning objectives
- State the principle: expenditure on an intangible item is an expense, unless it forms part of the cost of a qualifying asset or of goodwill in a business combination.
- Identify expenditure always recognised as an expense: start-up, training, advertising and promotion, relocation and reorganisation.
- Determine the date of the expense (access to goods, receipt of services) and the treatment of a prepayment.
- Record a launch budget: expenses of the period and prepayments.