{"entries":[{"key":"LX.IAS23.000001","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CORE.OBJECTIVE"],"dimension":"RULE_KNOWLEDGE","format":"FILL_BLANK","context":"GENERIC","tested_point":"PRINCIPLE","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS23.000001","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"understand"},"references":["IAS 23 §1"],"exercise":{"prompt":{"fr":"","en":"Complete the sentence.","es":""},"explanation":{"fr":"","en":"The principle targets qualifying assets (IAS 23, para. 1). Rule to remember: borrowing costs directly attributable to a qualifying asset form part of its cost (IAS 23, para. 1).","es":""},"common_error":{"fr":"","en":"Applying the principle to any asset.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"Borrowing costs directly attributable to a {{b1}} asset form part of the cost of that asset; the others are expenses.","es":""},"blanks":[{"id":"b1","mode":"CHOICE","choices":[{"id":"a","text":{"fr":"","en":"financial","es":""}},{"id":"b","text":{"fr":"","en":"qualifying","es":""}},{"id":"c","text":{"fr":"","en":"current","es":""}}],"answer":"b"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000002","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CORE.CAPITALISE_OR_EXPENSE"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"CAPITALISE_OR_EXPENSE","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS23.000001","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"rule-principle"},"references":["IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"During the year, the company Orlane bears interest on a loan financing the construction of its new plant (qualifying asset) and interest on a day-to-day cash overdraft. Which interest is included in the cost of the plant?","es":""},"explanation":{"fr":"","en":"The construction loan is directly attributable to the plant; the day-to-day overdraft is not (IAS 23, para. 8).","es":""},"common_error":{"fr":"","en":"Capitalising all interest of the period.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The interest on the construction loan","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The interest on the day-to-day cash overdraft","es":""},"correct":false,"feedback":{"fr":"","en":"The overdraft funds day-to-day cash, with no direct link to the plant: its interest remains an expense of the period (IAS 23, para. 8).","es":""}},{"id":"C","text":{"fr":"","en":"Both, because they fall in the same period","es":""},"correct":false,"feedback":{"fr":"","en":"Falling in the same period is not enough: direct attribution to the asset decides the treatment (IAS 23, para. 8).","es":""}},{"id":"D","text":{"fr":"","en":"Neither, because interest remains an expense","es":""},"correct":false,"feedback":{"fr":"","en":"The standard requires borrowing costs directly attributable to a qualifying asset to be included in cost; they do not stay in expense (IAS 23, para. 8).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000003","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CORE.DIRECTLY_ATTRIBUTABLE"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"CONSTRUCTION","tested_point":"AVOIDANCE_TEST","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS23.000001","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"rule-attributable"},"references":["IAS 23 §10","IAS 23 §11"],"exercise":{"prompt":{"fr":"","en":"Sort each borrowing cost of the company Vellane by its treatment.","es":""},"explanation":{"fr":"","en":"The costs sorted as capitalised are those the entity would have avoided without the expenditure on the asset; the others stay in expense (IAS 23, paras. 10 and 11). Rule to remember: a borrowing cost is attributable to the asset if it would have been avoided without the expenditure on that asset (IAS 23, paras. 10 and 11).","es":""},"common_error":{"fr":"","en":"Judging attribution by the type of loan rather than by avoidance.","es":""},"format":"CLASSIFICATION","categories":[{"id":"cap","text":{"fr":"","en":"Included in the cost of the qualifying asset","es":""}},{"id":"exp","text":{"fr":"","en":"Expense of the period","es":""}}],"items":[{"id":"i1","text":{"fr":"","en":"Interest on a loan drawn to finance building a power plant","es":""},"category":"cap"},{"id":"i2","text":{"fr":"","en":"Interest on a credit used to finance day-to-day inventories","es":""},"category":"exp"},{"id":"i3","text":{"fr":"","en":"Interest on a loan the entity would not have taken out without the power plant works","es":""},"category":"cap"},{"id":"i4","text":{"fr":"","en":"Interest on a refinancing loan unrelated to any qualifying asset","es":""},"category":"exp"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000004","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CORE.CAPITALISE_OR_EXPENSE","IAS23.CORE.DIRECTLY_ATTRIBUTABLE"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"CAPITALISED_VS_EXPENSED","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS23.000001","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"numeric-split"},"references":["IAS 23 §8","IAS 23 §10","IAS 23 §11"],"exercise":{"prompt":{"fr":"","en":"The company Telvane bears €320,000 of borrowing costs for the year, of which €210,000 are directly attributable to building a warehouse (qualifying asset, case data). Calculate the amounts capitalised and expensed.","es":""},"explanation":{"fr":"","en":"320,000 − 210,000 = 110,000. The attributable €210,000 is capitalised, the balance is an expense (IAS 23, para. 8). Rule to remember: the part attributable to the qualifying asset is capitalised and the rest is expensed (IAS 23, para. 8).","es":""},"common_error":{"fr":"","en":"Capitalising the full €320,000.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Borrowing costs for the year","es":""},"value":"320000","unit":"EUR"},{"label":{"fr":"","en":"Of which directly attributable to the warehouse","es":""},"value":"210000","unit":"EUR"}],"steps":[{"id":"cap","label":{"fr":"","en":"Amount capitalised","es":""},"answer":210000,"tolerance":0,"unit":"EUR"},{"id":"exp","label":{"fr":"","en":"Amount expensed","es":""},"answer":110000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"exp","meaning":{"fr":"","en":"Amount expensed","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Borrowing costs for the year","es":""},"value":320000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Of which directly attributable to the warehouse","es":""},"value":210000,"unit":"EUR"}],"result":110000,"unit":"EUR"}],"rationale":{"fr":"","en":"the part attributable to the qualifying asset is capitalised and the rest is expensed (IAS 23, para. 8).","es":""},"references":["REF.IAS23.8"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000005","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CORE.CAPITALISE_OR_EXPENSE"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"MANUFACTURING","tested_point":"ENTRY_SPLIT","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS23.000001","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"entry"},"references":["IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"The company Telvane owes €320,000 of interest for the year, of which €210,000 is capitalised into the cost of the warehouse under construction. Record the entry recognising the interest (one entry).","es":""},"explanation":{"fr":"","en":"Debit asset under construction 210,000; debit interest expense 110,000; credit interest payable 320,000. Total debits 320,000 = total credits 320,000 (IAS 23, para. 8). Rule to remember: the attributable part goes to the asset, the balance to expense, and the interest liability is recognised in full (IAS 23, para. 8).","es":""},"common_error":{"fr":"","en":"Debiting interest expense for the full amount.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"auc","text":{"fr":"","en":"Asset under construction","es":""}},{"id":"exp","text":{"fr":"","en":"Interest expense","es":""}},{"id":"pay","text":{"fr":"","en":"Interest payable","es":""}}],"lines":[{"id":"l1","account":"auc","side":"DEBIT","amount":210000,"given":["account","side"]},{"id":"l2","account":"exp","side":"DEBIT","amount":110000},{"id":"l3","account":"pay","side":"CREDIT","amount":320000,"given":["account","side"]}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000006","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CORE.OBJECTIVE","IAS23.CORE.CAPITALISE_OR_EXPENSE"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"GENERIC","tested_point":"PRINCIPLE_STATEMENTS","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS23.000001","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"rule-principle"},"references":["IAS 23 §1","IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"Spot the erroneous statements about the principle of IAS 23.","es":""},"explanation":{"fr":"","en":"The principle separates attributable costs (asset cost) from the others (expenses); capitalisation moves the charge to future depreciation (IAS 23, para. 1) (IAS 23, para. 8). Rule to remember: a borrowing cost attributable to a qualifying asset is capitalised; it is not income (IAS 23, para. 1).","es":""},"common_error":{"fr":"","en":"Confusing capitalisation with income, or capitalising without attribution.","es":""},"format":"ERROR_SPOT","statements":[{"id":"e1","text":{"fr":"","en":"Borrowing costs directly attributable to a qualifying asset are included in its cost.","es":""},"erroneous":false},{"id":"e2","text":{"fr":"","en":"All the entity's borrowing costs are capitalisable as soon as it builds an asset.","es":""},"erroneous":true,"correction":{"fr":"","en":"Costs directly attributable to a qualifying asset are capitalised; the others are expenses (IAS 23, para. 8).","es":""}},{"id":"e3","text":{"fr":"","en":"Borrowing costs not attributable to a qualifying asset are recognised as an expense of the period.","es":""},"erroneous":false},{"id":"e4","text":{"fr":"","en":"Capitalised interest increases profit for the period, because it is not an expense.","es":""},"erroneous":true,"correction":{"fr":"","en":"Capitalised interest creates no income: it avoids an expense by increasing the cost of the asset, which will be depreciated (IAS 23, para. 8).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000007","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CORE.RECOGNITION_CONDITIONS"],"dimension":"RECOGNITION","format":"MULTIPLE_CHOICE","context":"GENERIC","tested_point":"RECOGNITION_CONDITIONS","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS23.000001","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"rule-conditions"},"references":["IAS 23 §9"],"exercise":{"prompt":{"fr":"","en":"Which of these conditions are cited for capitalising a borrowing cost into the asset?","es":""},"explanation":{"fr":"","en":"The elements cited are probable future benefits and reliable measurement of the cost (IAS 23, para. 9). Rule to remember: capitalisation is associated with probable future benefits and a reliably measurable cost (IAS 23, para. 9).","es":""},"common_error":{"fr":"","en":"Adding numerical conditions that are not in the text.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Probable future economic benefits for the entity","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"A cost that can be measured reliably","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"An interest rate above the market rate","es":""},"correct":false,"feedback":{"fr":"","en":"No rate-level condition is cited: the rate is a datum and does not condition capitalisation (IAS 23, para. 9).","es":""}},{"id":"D","text":{"fr":"","en":"A construction period of at least twelve months","es":""},"correct":false,"feedback":{"fr":"","en":"No numerical minimum duration is set; a substantial period is a judgement on the facts (IAS 23, para. 9).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000008","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CORE.DIRECTLY_ATTRIBUTABLE","IAS23.CORE.CAPITALISE_OR_EXPENSE"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"CONSTRUCTION","tested_point":"ATTRIBUTION_FILE","difficulty":"EXPERT","estimated_time_s":150,"lesson_id":"LS.IAS23.000001","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"judgment"},"references":["IAS 23 §10","IAS 23 §11","IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"Linking loans to two projects of the company Norvane.","es":""},"explanation":{"fr":"","en":"Professional judgement: linking a loan to a project rests on the facts (use of funds, dates) and should be documented in the file; the effect is a lower expense and an asset increased by €100,000 (IAS 23, paras. 10 and 11). Rule to remember: the cost the entity would have avoided without the expenditure on the asset is attributable to that asset (IAS 23, paras. 10 and 11).","es":""},"common_error":{"fr":"","en":"Linking a loan to a project without examining the actual use of funds.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Teaching assumption: the fictitious company Norvane builds a qualifying warehouse (project A) and refurbishes its administrative offices while continuing to use them (project B, not qualifying, case data). It drew loan P1 (€100,000 of interest for the year) to pay the warehouse contractors, and credit C2 (€40,000 of interest) for its day-to-day cash.","es":""},"parts":[{"prompt":{"fr":"","en":"Which interest is directly attributable to the warehouse?","es":""},"explanation":{"fr":"","en":"P1 is directly attributable to the warehouse (IAS 23, paras. 10 and 11).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"That of C2, because cash funds everything","es":""},"correct":false,"feedback":{"fr":"","en":"C2 funds day-to-day operations: its cost is not linked to the expenditure on the warehouse (IAS 23, paras. 10 and 11).","es":""}},{"id":"B","text":{"fr":"","en":"That of P1 and C2 together","es":""},"correct":false,"feedback":{"fr":"","en":"The cost the entity would have avoided without the works links to the asset; C2 does not meet this test (IAS 23, paras. 10 and 11).","es":""}},{"id":"C","text":{"fr":"","en":"None, because a warehouse cannot be a qualifying asset","es":""},"correct":false,"feedback":{"fr":"","en":"The qualifying nature comes from the substantial period needed, not from the type of building; here the case treats it as qualifying (IAS 23, paras. 10 and 11).","es":""}},{"id":"D","text":{"fr":"","en":"That of P1, which the entity would have avoided without the warehouse works","es":""},"correct":true}],"id":"p1","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"What amount of interest is capitalised into the warehouse, and what amount is expensed?","es":""},"explanation":{"fr":"","en":"Capitalised interest = interest on P1, attributable to the qualifying asset = €100,000; interest expensed = interest on C2 = €40,000 (IAS 23, para. 8). Rule to remember: the cost attributable to the qualifying asset is capitalised, the rest is an expense (IAS 23, para. 8).","es":""},"common_error":{"fr":"","en":"Capitalising all interest in the warehouse: only that attributable to the qualifying asset (P1) is; the rest (C2) is expensed.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Interest on P1","es":""},"value":"100000","unit":"EUR"},{"label":{"fr":"","en":"Interest on C2","es":""},"value":"40000","unit":"EUR"}],"steps":[{"id":"cap","label":{"fr":"","en":"Capitalised","es":""},"answer":100000,"tolerance":0,"unit":"EUR"},{"id":"exp","label":{"fr":"","en":"Expensed","es":""},"answer":40000,"tolerance":0,"unit":"EUR"}],"id":"p2","dimension":"CALCULATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000009","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SCOPE.GENERAL"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"POLICY_CHOICE","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS23.000002","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000002","section_id":"rule-scope"},"references":["IAS 23 §2","IAS 23 §3"],"exercise":{"prompt":{"fr":"","en":"Since the option to expense was removed, capitalising borrowing costs directly attributable to a qualifying asset is optional.","es":""},"explanation":{"fr":"","en":"The current standard requires these costs to be capitalised (IAS 23). Rule to remember: capitalisation is required for costs directly attributable to a qualifying asset (IAS 23).","es":""},"common_error":{"fr":"","en":"Thinking the entity chooses its policy as before.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000010","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SCOPE.GENERAL"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"MANDATORY_CAPITALISATION","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS23.000002","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000002","section_id":"rule-scope"},"references":["IAS 23 §2","IAS 23 §3"],"exercise":{"prompt":{"fr":"","en":"The company Ardane has always expensed its interest. It is now building a plant that needs a long preparation period, financed by a dedicated loan. What does the current standard provide for this interest?","es":""},"explanation":{"fr":"","en":"Capitalising costs directly attributable to a qualifying asset is required (IAS 23).","es":""},"common_error":{"fr":"","en":"Keeping a former practice of expensing.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The entity keeps the choice between capitalising and expensing","es":""},"correct":false,"feedback":{"fr":"","en":"That option was removed: for a qualifying asset, capitalising directly attributable costs is required (IAS 23).","es":""}},{"id":"B","text":{"fr":"","en":"They stay in expense as long as the entity does not change its accounting method","es":""},"correct":false,"feedback":{"fr":"","en":"This is not a matter of preference: the standard provides for these costs to be capitalised (IAS 23).","es":""}},{"id":"C","text":{"fr":"","en":"They are capitalised only if the loan exceeds one million euros","es":""},"correct":false,"feedback":{"fr":"","en":"No numerical amount threshold is set: capitalisation depends on the qualifying asset and attribution (IAS 23).","es":""}},{"id":"D","text":{"fr":"","en":"They are included in the cost of the plant; the entity no longer has a choice","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000011","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SCOPE.EXCLUSIONS"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"AGRICULTURE","tested_point":"EXCLUDED_ASSET","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS23.000002","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000002","section_id":"rule-exclusions"},"references":["IAS 23 §4"],"exercise":{"prompt":{"fr":"","en":"The company Vignal finances by borrowing a vineyard plantation that it measures at fair value (biological asset, case data). What is the effect on the scope of IAS 23?","es":""},"explanation":{"fr":"","en":"For an asset measured at fair value, the entity is not required to apply IAS 23 (IAS 23, para. 4).","es":""},"common_error":{"fr":"","en":"Deducing scope from the way of financing.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The asset is within scope because it is financed by borrowing","es":""},"correct":false,"feedback":{"fr":"","en":"The way of financing does not decide scope: for an asset measured at fair value, the entity is not required to apply the standard (IAS 23, para. 4).","es":""}},{"id":"B","text":{"fr":"","en":"The entity is not required to apply IAS 23 to this asset","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The asset is within scope but its interest is halved","es":""},"correct":false,"feedback":{"fr":"","en":"The standard provides no proportional reduction: exemption is a scope matter (IAS 23, para. 4).","es":""}},{"id":"D","text":{"fr":"","en":"The asset is within scope if the plantation is young","es":""},"correct":false,"feedback":{"fr":"","en":"The age of the plantation does not change the rule: it is fair value measurement that relieves the entity of applying the standard to the asset (IAS 23, para. 4).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000012","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SCOPE.EXCLUSIONS"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"MANUFACTURING","tested_point":"SCOPE_SORTING","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS23.000002","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000002","section_id":"example"},"references":["IAS 23 §4"],"exercise":{"prompt":{"fr":"","en":"Sort each asset of the company Calvane by whether it is within the scope of IAS 23 or the entity is not required to apply it (para. 4).","es":""},"explanation":{"fr":"","en":"Fair value and repetitive production relieve the entity of applying the standard; cost measurement of an asset that takes long to build keeps it within scope (IAS 23, para. 4). Rule to remember: the entity is not required to apply the standard to assets measured at fair value or to inventories produced in large quantities on a repetitive basis (IAS 23, para. 4).","es":""},"common_error":{"fr":"","en":"Treating as exempt an asset at cost because it is biological or agricultural.","es":""},"format":"CLASSIFICATION","categories":[{"id":"in","text":{"fr":"","en":"Within scope","es":""}},{"id":"out","text":{"fr":"","en":"Exempt (the entity is not required to apply the standard)","es":""}}],"items":[{"id":"i1","text":{"fr":"","en":"A power station under construction, measured at cost","es":""},"category":"in"},{"id":"i2","text":{"fr":"","en":"A biological asset measured at fair value","es":""},"category":"out"},{"id":"i3","text":{"fr":"","en":"Drinks produced in large quantities on a repetitive basis","es":""},"category":"out"},{"id":"i4","text":{"fr":"","en":"A tailor-made ship, measured at cost","es":""},"category":"in"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000013","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SCOPE.GENERAL","IAS23.SCOPE.EXCLUSIONS"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"GENERIC","tested_point":"SCOPE_STATEMENTS","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS23.000002","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000002","section_id":"pitfalls"},"references":["IAS 23 §2","IAS 23 §3","IAS 23 §4"],"exercise":{"prompt":{"fr":"","en":"Spot the erroneous statements about the scope of IAS 23.","es":""},"explanation":{"fr":"","en":"For fair value and repetitive production, the entity is not required to apply the standard; for qualifying assets, the standard applies (IAS 23, para. 4). Rule to remember: the exemption stems from fair value measurement or repetitive production, not from financing (IAS 23, para. 4).","es":""},"common_error":{"fr":"","en":"Confusing the scope of the standard with the way of financing.","es":""},"format":"ERROR_SPOT","statements":[{"id":"e1","text":{"fr":"","en":"For inventories produced in large quantities on a repetitive basis, the entity is not required to apply the standard.","es":""},"erroneous":false},{"id":"e2","text":{"fr":"","en":"A qualifying asset measured at fair value is within scope as soon as it is financed by borrowing.","es":""},"erroneous":true,"correction":{"fr":"","en":"For an asset measured at fair value, the entity is not required to apply the standard, whatever its financing (IAS 23, para. 4).","es":""}},{"id":"e3","text":{"fr":"","en":"The entity freely chooses between capitalising and expensing the costs of a qualifying asset.","es":""},"erroneous":true,"correction":{"fr":"","en":"The option to expense was removed: capitalisation is required for a qualifying asset (IAS 23).","es":""}},{"id":"e4","text":{"fr":"","en":"A plant measured at cost and long to build is within scope.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000014","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_ASSET"],"dimension":"RULE_KNOWLEDGE","format":"SINGLE_CHOICE","context":"GENERIC","tested_point":"QUALIFYING_DEFINITION","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS23.000003","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"rule-qualifying"},"references":["IAS 23 §5"],"exercise":{"prompt":{"fr":"","en":"How does the standard define a qualifying asset?","es":""},"explanation":{"fr":"","en":"A qualifying asset is defined by the substantial period needed to prepare it (IAS 23, para. 5).","es":""},"common_error":{"fr":"","en":"Confusing a qualifying asset with an asset bought on credit.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"An asset that necessarily takes a substantial period to get ready for its use or sale","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"An asset acquired through a loan, whatever the length of its preparation or the nature of the asset","es":""},"correct":false,"feedback":{"fr":"","en":"Financing by loan is not enough: what counts is the preparation time of the asset (IAS 23, para. 5).","es":""}},{"id":"C","text":{"fr":"","en":"An asset whose price exceeds a high threshold, regardless of the time needed to prepare it","es":""},"correct":false,"feedback":{"fr":"","en":"The definition rests on no price threshold (IAS 23, para. 5).","es":""}},{"id":"D","text":{"fr":"","en":"An asset held for more than a year","es":""},"correct":false,"feedback":{"fr":"","en":"The holding period is not the criterion: it is the period needed to prepare the asset (IAS 23, para. 5).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000015","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_ASSET"],"dimension":"RECOGNITION","format":"TRUE_FALSE","context":"RETAIL","tested_point":"READY_ON_ACQUISITION","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS23.000003","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"how"},"references":["IAS 23 §5"],"exercise":{"prompt":{"fr":"","en":"The company Pelvane buys a set of computer servers delivered and immediately usable. These servers are a qualifying asset.","es":""},"explanation":{"fr":"","en":"Servers usable on delivery do not need a substantial preparation period (IAS 23, para. 5). Rule to remember: an asset ready for use on acquisition is not a qualifying asset (IAS 23, para. 5).","es":""},"common_error":{"fr":"","en":"Qualifying the asset because it is expensive or financed by borrowing.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000016","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.BORROWING_COSTS"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"GENERIC","tested_point":"BORROWING_COST_ITEMS","difficulty":"BEGINNER","estimated_time_s":60,"lesson_id":"LS.IAS23.000003","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"rule-borrowing"},"references":["IAS 23 §5"],"exercise":{"prompt":{"fr":"","en":"Sort each item by whether or not it is a borrowing cost.","es":""},"explanation":{"fr":"","en":"Interest at the effective rate, interest on lease liabilities and certain exchange differences are borrowing costs; salaries and the land price are asset costs, not borrowing costs (IAS 23). Rule to remember: borrowing costs are the costs borne because the entity has borrowed (IAS 23, para. 5).","es":""},"common_error":{"fr":"","en":"Classing a site cost among borrowing costs.","es":""},"format":"CLASSIFICATION","categories":[{"id":"yes","text":{"fr":"","en":"Borrowing cost","es":""}},{"id":"no","text":{"fr":"","en":"Not a borrowing cost","es":""}}],"items":[{"id":"i1","text":{"fr":"","en":"Interest on a bank loan calculated at the effective interest rate","es":""},"category":"yes"},{"id":"i2","text":{"fr":"","en":"Interest on lease liabilities","es":""},"category":"yes"},{"id":"i3","text":{"fr":"","en":"Salaries of the site teams","es":""},"category":"no"},{"id":"i4","text":{"fr":"","en":"Purchase price of the land","es":""},"category":"no"},{"id":"i5","text":{"fr":"","en":"Exchange differences regarded as an adjustment to interest","es":""},"category":"yes"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000017","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_EXAMPLES"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"ENERGY","tested_point":"QUALIFYING_EXAMPLE","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS23.000003","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"examples"},"references":["IAS 23 §7"],"exercise":{"prompt":{"fr":"","en":"The company Hélane builds an electricity generation plant over several years. How should it be analysed?","es":""},"explanation":{"fr":"","en":"Power generation facilities are among the examples of qualifying assets (IAS 23, para. 7).","es":""},"common_error":{"fr":"","en":"Reserving qualifying status to certain kinds of assets.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It is not qualifying because it is a tangible asset","es":""},"correct":false,"feedback":{"fr":"","en":"Being tangible does not exclude: plants and power facilities are among the qualifying examples (IAS 23, para. 7).","es":""}},{"id":"B","text":{"fr":"","en":"It is qualifying if it costs more than ten million euros","es":""},"correct":false,"feedback":{"fr":"","en":"No cost threshold appears in the definition (IAS 23).","es":""}},{"id":"C","text":{"fr":"","en":"It is a financial asset","es":""},"correct":false,"feedback":{"fr":"","en":"A power plant is a constructed tangible asset, not a financial asset (IAS 23, para. 7).","es":""}},{"id":"D","text":{"fr":"","en":"It is an example of a qualifying asset depending on the facts","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000018","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_EXAMPLES"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"GENERIC","tested_point":"QUALIFYING_SORTING","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS23.000003","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"examples"},"references":["IAS 23 §7"],"exercise":{"prompt":{"fr":"","en":"Based on the facts given, sort each asset of the company Orvane.","es":""},"explanation":{"fr":"","en":"Plants and investment properties under long construction can be qualifying; financial assets and rapidly produced inventories are not (IAS 23, para. 7). Rule to remember: assets that necessarily take a substantial period to get ready are qualifying (IAS 23).","es":""},"common_error":{"fr":"","en":"Qualifying a financial asset because it is held for long.","es":""},"format":"CLASSIFICATION","categories":[{"id":"q","text":{"fr":"","en":"Qualifying asset","es":""}},{"id":"n","text":{"fr":"","en":"Non-qualifying asset","es":""}}],"items":[{"id":"i1","text":{"fr":"","en":"Plant whose construction requires long works","es":""},"category":"q"},{"id":"i2","text":{"fr":"","en":"Investment property under construction over a long period","es":""},"category":"q"},{"id":"i3","text":{"fr":"","en":"Shares held for investment","es":""},"category":"n"},{"id":"i4","text":{"fr":"","en":"Inventory produced rapidly on an automated line","es":""},"category":"n"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000019","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_ASSET"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"SHIPPING","tested_point":"QUALIFYING_CASE","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS23.000003","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"how"},"references":["IAS 23 §5"],"exercise":{"prompt":{"fr":"","en":"The company Marlenne orders a tailor-made ship, whose construction will take, according to its plan, twenty-eight months (case data). It also orders a standard machine delivered ready for use. What can be concluded?","es":""},"explanation":{"fr":"","en":"A qualifying asset is recognised by the substantial period needed to prepare it (IAS 23, para. 5). Case convention: the twenty-eight months is a case datum, not a threshold from the standard.","es":""},"common_error":{"fr":"","en":"Making qualification depend on financing or cost.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Both are qualifying since both are financed by borrowing","es":""},"correct":false,"feedback":{"fr":"","en":"The way of financing does not make an asset qualifying; the ready-to-use machine needs no preparation period (IAS 23, para. 5).","es":""}},{"id":"B","text":{"fr":"","en":"Neither is qualifying because the ship does not take long enough","es":""},"correct":false,"feedback":{"fr":"","en":"The standard sets no minimum duration; here the facts of the case lead to a substantial period for the ship (IAS 23, para. 5).","es":""}},{"id":"C","text":{"fr":"","en":"The ship is a qualifying asset; the machine is not","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"The machine is qualifying because it costs less","es":""},"correct":false,"feedback":{"fr":"","en":"Cost is not part of the definition; the ready-to-use machine is not qualifying (IAS 23, para. 5).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000020","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_ASSET","IAS23.DEFINITIONS.QUALIFYING_EXAMPLES"],"dimension":"RULE_KNOWLEDGE","format":"FILL_BLANK","context":"GENERIC","tested_point":"QUALIFYING_FILL","difficulty":"INTERMEDIATE","estimated_time_s":50,"lesson_id":"LS.IAS23.000003","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"rule-qualifying"},"references":["IAS 23 §5","IAS 23 §7"],"exercise":{"prompt":{"fr":"","en":"Complete the sentence.","es":""},"explanation":{"fr":"","en":"The period is substantial, with no fixed duration, and financial assets are not qualifying (IAS 23, para. 5) (IAS 23, para. 7). Rule to remember: the period must be substantial, a judgement based on the facts, with no imposed duration (IAS 23, para. 5).","es":""},"common_error":{"fr":"","en":"Setting a precise duration as a requirement of the standard.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"A qualifying asset necessarily takes a {{b1}} period to get ready for its intended use or sale; a {{b2}} asset is not qualifying.","es":""},"blanks":[{"id":"b1","mode":"CHOICE","choices":[{"id":"a","text":{"fr":"","en":"exactly equal to one year","es":""}},{"id":"b","text":{"fr":"","en":"any","es":""}},{"id":"c","text":{"fr":"","en":"substantial","es":""}}],"answer":"c"},{"id":"b2","mode":"CHOICE","choices":[{"id":"a","text":{"fr":"","en":"tangible","es":""}},{"id":"b","text":{"fr":"","en":"financial","es":""}},{"id":"c","text":{"fr":"","en":"depreciated","es":""}}],"answer":"b"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000021","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_ASSET"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"GENERIC","tested_point":"THRESHOLD_ERRORS","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS23.000003","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"judgment"},"references":["IAS 23 §5"],"exercise":{"prompt":{"fr":"","en":"Spot the erroneous statements in an internal memo about qualifying assets.","es":""},"explanation":{"fr":"","en":"Qualification rests on the preparation period needed, assessed with judgement, not on a fixed duration or on the holding period (IAS 23, para. 5) (IAS 23). Rule to remember: no numerical minimum duration is imposed for the substantial period (IAS 23, para. 5).","es":""},"common_error":{"fr":"","en":"Turning an internal benchmark into a requirement of the standard.","es":""},"format":"ERROR_SPOT","statements":[{"id":"e1","text":{"fr":"","en":"An asset is qualifying if its preparation necessarily takes a substantial period.","es":""},"erroneous":false},{"id":"e2","text":{"fr":"","en":"An asset is qualifying when its construction lasts at least twelve months.","es":""},"erroneous":true,"correction":{"fr":"","en":"The standard sets no numerical minimum duration: a substantial period is a judgement based on the facts (IAS 23, para. 5).","es":""}},{"id":"e3","text":{"fr":"","en":"A financial asset held for a long time becomes a qualifying asset.","es":""},"erroneous":true,"correction":{"fr":"","en":"A financial asset is not a qualifying asset, however long it is held (IAS 23).","es":""}},{"id":"e4","text":{"fr":"","en":"An asset ready for use on acquisition is not a qualifying asset.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000022","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_ASSET","IAS23.DEFINITIONS.QUALIFYING_EXAMPLES"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"MANUFACTURING","tested_point":"QUALIFYING_JUDGEMENT_CASE","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS23.000003","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"judgment"},"references":["IAS 23 §5","IAS 23 §7"],"exercise":{"prompt":{"fr":"","en":"Qualifying two assets of the company Talvane.","es":""},"explanation":{"fr":"","en":"Professional judgement: the conclusion on P rests on the facts of the schedule and should be documented; it leads to capitalising borrowing costs directly attributable to P, which increases the asset and reduces interest expense (IAS 23, para. 5). Rule to remember: an asset is qualifying when a substantial period is necessarily required to prepare it (IAS 23, para. 5).","es":""},"common_error":{"fr":"","en":"Qualifying without analysing the real preparation time.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Teaching assumption: the fictitious company Talvane has a tailor-made production line built, with a schedule providing for installation in several phases spread over many months (asset P). It also buys a batch of already manufactured pallets, delivered to stock and immediately usable (asset Q).","es":""},"parts":[{"prompt":{"fr":"","en":"Is asset P a qualifying asset?","es":""},"explanation":{"fr":"","en":"The facts (phases spread over many months) support a substantial period (IAS 23, para. 5).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Yes, because the facts show that a substantial period is needed to prepare it","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"No, because the preparation period is not quantified","es":""},"correct":false,"feedback":{"fr":"","en":"The absence of a numerical duration does not remove qualification: it is a judgement based on the facts (IAS 23, para. 5).","es":""}},{"id":"C","text":{"fr":"","en":"No, because a production line is ordinary equipment","es":""},"correct":false,"feedback":{"fr":"","en":"The kind of equipment does not exclude; plants and installations are among the examples (IAS 23, para. 7).","es":""}},{"id":"D","text":{"fr":"","en":"Yes, because it is financed by borrowing","es":""},"correct":false,"feedback":{"fr":"","en":"Financing does not make an asset qualifying; the long preparation and the facts do (IAS 23, para. 5).","es":""}}],"id":"p1","dimension":"RECOGNITION"},{"prompt":{"fr":"","en":"And asset Q?","es":""},"explanation":{"fr":"","en":"A batch already manufactured and immediately usable is not a qualifying asset (IAS 23, para. 5).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It is qualifying because it is delivered to stock","es":""},"correct":false,"feedback":{"fr":"","en":"Inventory ready on delivery does not need a substantial preparation period (IAS 23, para. 5).","es":""}},{"id":"B","text":{"fr":"","en":"It is qualifying because all inventory is","es":""},"correct":false,"feedback":{"fr":"","en":"Inventory is qualifying if it needs a substantial period to get ready; that is not so here (IAS 23, para. 7).","es":""}},{"id":"C","text":{"fr":"","en":"No conclusion is possible without knowing the price","es":""},"correct":false,"feedback":{"fr":"","en":"Price plays no part in the definition (IAS 23, para. 5).","es":""}},{"id":"D","text":{"fr":"","en":"It is not qualifying: it is immediately usable","es":""},"correct":true}],"id":"p2","dimension":"RECOGNITION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000023","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.BORROWING_COSTS.COMPONENTS"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"GENERIC","tested_point":"COMPONENTS_LIST","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS23.000004","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"rule-components"},"references":["IAS 23 §6"],"exercise":{"prompt":{"fr":"","en":"Which item is not a component of borrowing costs?","es":""},"explanation":{"fr":"","en":"Salaries are asset costs, not borrowing costs (IAS 23).","es":""},"common_error":{"fr":"","en":"Mixing construction costs and financing costs.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Interest calculated at the effective interest rate","es":""},"correct":false,"feedback":{"fr":"","en":"This is a cited component: interest at the effective rate is a borrowing cost (IAS 23).","es":""}},{"id":"B","text":{"fr":"","en":"Salaries paid to the teams building the asset","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Interest on lease liabilities","es":""},"correct":false,"feedback":{"fr":"","en":"This is a component cited in the standard (IAS 23).","es":""}},{"id":"D","text":{"fr":"","en":"Exchange differences regarded as an adjustment to interest","es":""},"correct":false,"feedback":{"fr":"","en":"This is a cited component, to the extent of the comparison (IAS 23).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000024","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.BORROWING_COSTS.COMPONENTS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"LEASE_INTEREST","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS23.000004","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"rule-components"},"references":["IAS 23 §6"],"exercise":{"prompt":{"fr":"","en":"An entity that leases equipment bears interest on its lease liability: this interest is a borrowing cost within the meaning of IAS 23.","es":""},"explanation":{"fr":"","en":"The standard places interest on lease liabilities among borrowing costs (IAS 23). Rule to remember: interest on lease liabilities is a borrowing cost (IAS 23).","es":""},"common_error":{"fr":"","en":"Limiting borrowing costs to bank loans.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000025","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.BORROWING_COSTS.COMPONENTS"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"INTEREST_PERIOD","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS23.000004","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"numeric-interest"},"references":["IAS 23 §6"],"exercise":{"prompt":{"fr":"","en":"The company Berlane borrows €1,200,000 on 1 April, at an effective interest rate of 6.5% (case data; the nominal coupon is 5%). It closes on 31 December. Calculate the interest for the period.","es":""},"explanation":{"fr":"","en":"1,200,000 × 6.5% × 9/12 = €58,500. The cost follows the effective rate, not the nominal coupon (IAS 23). Case convention: the effective rate is given; calculating it falls under IFRS 9. Rule to remember: the borrowing cost of a period is calculated at the effective interest rate (IAS 23).","es":""},"common_error":{"fr":"","en":"Applying the nominal coupon of 5% instead of the effective rate.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Principal borrowed","es":""},"value":"1200000","unit":"EUR"},{"label":{"fr":"","en":"Effective interest rate","es":""},"value":"6.5","unit":"%"},{"label":{"fr":"","en":"Length of the period","es":""},"value":"9","unit":"MONTHS"}],"steps":[{"id":"int","label":{"fr":"","en":"Interest for the period","es":""},"answer":58500,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"int","meaning":{"fr":"","en":"Interest for the period","es":""},"expression":"a * b * c / 12","variables":[{"symbol":"a","meaning":{"fr":"","en":"Principal borrowed","es":""},"value":1200000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"at an effective interest rate of 6.5%","es":""},"value":6.5,"unit":"PERCENT"},{"symbol":"c","meaning":{"fr":"","en":"Length of the period","es":""},"value":9,"unit":"MONTHS"}],"result":58500,"unit":"EUR"}],"rationale":{"fr":"","en":"the borrowing cost of a period is calculated at the effective interest rate (IAS 23).","es":""},"references":["REF.IAS23.6"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000026","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.BORROWING_COSTS.COMPONENTS"],"dimension":"RECOGNITION","format":"MATCHING","context":"GENERIC","tested_point":"COMPONENT_MATCHING","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS23.000004","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"rule-components"},"references":["IAS 23 §6"],"exercise":{"prompt":{"fr":"","en":"Match each component of borrowing costs to its origin.","es":""},"explanation":{"fr":"","en":"Each component comes from a different type of transaction (IAS 23). Rule to remember: borrowing costs cover interest at the effective rate, lease liabilities and certain exchange differences (IAS 23).","es":""},"common_error":{"fr":"","en":"Looking for a single origin for all borrowing costs.","es":""},"format":"MATCHING","left":[{"id":"l1","text":{"fr":"","en":"Interest at the effective interest rate","es":""}},{"id":"l2","text":{"fr":"","en":"Interest on lease liabilities","es":""}},{"id":"l3","text":{"fr":"","en":"Exchange differences regarded as interest","es":""}}],"right":[{"id":"r1","text":{"fr":"","en":"A bank loan measured at amortised cost","es":""}},{"id":"r2","text":{"fr":"","en":"An equipment lease contract","es":""}},{"id":"r3","text":{"fr":"","en":"A loan denominated in a foreign currency","es":""}}],"pairs":[{"left":"l1","right":"r1"},{"left":"l2","right":"r2"},{"left":"l3","right":"r3"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000027","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.BORROWING_COSTS.FX_DIFFERENCES"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"GENERIC","tested_point":"FX_PART","difficulty":"ADVANCED","estimated_time_s":75,"lesson_id":"LS.IAS23.000004","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"rule-fx"},"references":["IAS 23 §6"],"exercise":{"prompt":{"fr":"","en":"The company Corvelle has a dollar loan. It records an exchange loss for the year. What does the standard say about treating it as a borrowing cost?","es":""},"explanation":{"fr":"","en":"The part regarded as an adjustment to interest enters borrowing costs (IAS 23).","es":""},"common_error":{"fr":"","en":"Capitalising the whole exchange loss.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The part regarded as an adjustment to interest is a borrowing cost","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The whole exchange loss is a borrowing cost","es":""},"correct":false,"feedback":{"fr":"","en":"The part regarded as an interest adjustment is the target; the rest is not a borrowing cost (IAS 23).","es":""}},{"id":"C","text":{"fr":"","en":"No part is a borrowing cost","es":""},"correct":false,"feedback":{"fr":"","en":"The standard provides on the contrary that a part of exchange differences can be regarded as an interest adjustment (IAS 23).","es":""}},{"id":"D","text":{"fr":"","en":"The exchange loss is a borrowing cost if it exceeds 10% of the principal","es":""},"correct":false,"feedback":{"fr":"","en":"No 10% threshold is set: the comparison is a judgement on the facts (IAS 23).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000028","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.BORROWING_COSTS.FX_DIFFERENCES","IAS23.BORROWING_COSTS.COMPONENTS"],"dimension":"CALCULATION","format":"CALCULATION","context":"GENERIC","tested_point":"FX_BORROWING_COST","difficulty":"EXPERT","estimated_time_s":120,"lesson_id":"LS.IAS23.000004","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"judgment"},"references":["IAS 23 §6"],"exercise":{"prompt":{"fr":"","en":"The company Corvelle bears €90,000 of interest on a foreign-currency loan and an exchange loss of €60,000. According to its documented analysis, €25,000 of this loss is regarded as an adjustment to interest (case data). Calculate the borrowing costs for the year and the exchange loss that is not part of them.","es":""},"explanation":{"fr":"","en":"90,000 + 25,000 = 115,000; 60,000 − 25,000 = 35,000. The borrowing costs of €115,000 are then capitalised or expensed; the €35,000 remains an exchange loss (IAS 23). Case convention: the €25,000 part is a case datum; the method and threshold are not set by this course. Rule to remember: the part of the exchange difference regarded as an adjustment to interest is added to borrowing costs (IAS 23).","es":""},"common_error":{"fr":"","en":"Adding the whole €60,000 exchange loss to borrowing costs.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Interest","es":""},"value":"90000","unit":"EUR"},{"label":{"fr":"","en":"Total exchange loss","es":""},"value":"60000","unit":"EUR"},{"label":{"fr":"","en":"Part regarded as interest","es":""},"value":"25000","unit":"EUR"}],"steps":[{"id":"bc","label":{"fr":"","en":"Borrowing costs for the year","es":""},"answer":115000,"tolerance":0,"unit":"EUR"},{"id":"rest","label":{"fr":"","en":"Exchange loss outside borrowing costs","es":""},"answer":35000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"bc","meaning":{"fr":"","en":"Borrowing costs for the year","es":""},"expression":"a + b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Interest","es":""},"value":90000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Part regarded as interest","es":""},"value":25000,"unit":"EUR"}],"result":115000,"unit":"EUR"},{"step":"rest","meaning":{"fr":"","en":"Exchange loss outside borrowing costs","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Total exchange loss","es":""},"value":60000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Part regarded as interest","es":""},"value":25000,"unit":"EUR"}],"result":35000,"unit":"EUR"}],"rationale":{"fr":"","en":"the part of the exchange difference regarded as an adjustment to interest is added to borrowing costs (IAS 23).","es":""},"references":["REF.IAS23.6"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000029","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.ACTUAL_COSTS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"ACTUAL_COSTS_RULE","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-actual"},"references":["IAS 23 §12"],"exercise":{"prompt":{"fr":"","en":"The company Ardelle borrows specifically to build a plant. To calculate the amount to capitalise, it takes the actual costs of that borrowing.","es":""},"explanation":{"fr":"","en":"For a specific borrowing, the actual costs of that borrowing are taken (IAS 23, para. 12). Rule to remember: a specific borrowing is capitalised at its actual cost, with no average rate (IAS 23, para. 12).","es":""},"common_error":{"fr":"","en":"Applying an average rate when the asset is financed by a specific borrowing.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000030","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.ACTUAL_COSTS"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"ENERGY","tested_point":"SPECIFIC_BORROWING","difficulty":"BEGINNER","estimated_time_s":50,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-actual"},"references":["IAS 23 §12"],"exercise":{"prompt":{"fr":"","en":"To build a power plant, the company Voltane borrows €5,000,000 at an effective rate of 4% from a bank, the loan being dedicated to this project (case data). What interest amount is eligible for the full year, before any investment income?","es":""},"explanation":{"fr":"","en":"5,000,000 × 4% = €200,000 of actual interest for the year (IAS 23, para. 12).","es":""},"common_error":{"fr":"","en":"Confusing principal and interest.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"€5,000,000, the principal borrowed","es":""},"correct":false,"feedback":{"fr":"","en":"Principal is not a borrowing cost: the interest of the period is taken (IAS 23, para. 12).","es":""}},{"id":"B","text":{"fr":"","en":"€100,000, half the annual cost","es":""},"correct":false,"feedback":{"fr":"","en":"The year is full: the 4% applies to the whole year on €5,000,000 (IAS 23, para. 12).","es":""}},{"id":"C","text":{"fr":"","en":"€400,000, double the annual cost","es":""},"correct":false,"feedback":{"fr":"","en":"A rate of 4% on €5,000,000 gives €200,000 a year, not double (IAS 23, para. 12).","es":""}},{"id":"D","text":{"fr":"","en":"€200,000, the actual cost for the year on this loan","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000031","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.ACTUAL_COSTS"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"ACTUAL_COSTS_CALC","difficulty":"INTERMEDIATE","estimated_time_s":80,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"numeric-specific"},"references":["IAS 23 §12"],"exercise":{"prompt":{"fr":"","en":"The company Marchane draws a €2,000,000 loan on 1 March at an effective interest rate of 6% (case data), dedicated to building a plant. It closes on 31 December (10 months). Calculate the actual cost for the period.","es":""},"explanation":{"fr":"","en":"2,000,000 × 6% × 10/12 = €100,000 (IAS 23, para. 12). Rule to remember: the actual cost of the period of a specific borrowing is eligible for capitalisation (IAS 23, para. 12).","es":""},"common_error":{"fr":"","en":"Counting twelve months although the loan is drawn only in March.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Principal","es":""},"value":"2000000","unit":"EUR"},{"label":{"fr":"","en":"Effective interest rate","es":""},"value":"6","unit":"%"},{"label":{"fr":"","en":"Length","es":""},"value":"10","unit":"MONTHS"}],"steps":[{"id":"cost","label":{"fr":"","en":"Actual cost for the period","es":""},"answer":100000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"cost","meaning":{"fr":"","en":"Actual cost for the period","es":""},"expression":"a * b * c / 12","variables":[{"symbol":"a","meaning":{"fr":"","en":"Principal","es":""},"value":2000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"March at an effective interest rate of 6%","es":""},"value":6,"unit":"PERCENT"},{"symbol":"c","meaning":{"fr":"","en":"Length","es":""},"value":10,"unit":"MONTHS"}],"result":100000,"unit":"EUR"}],"rationale":{"fr":"","en":"the actual cost of the period of a specific borrowing is eligible for capitalisation (IAS 23, para. 12).","es":""},"references":["REF.IAS23.12"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000032","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.INVESTMENT_INCOME"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"GENERIC","tested_point":"INVESTMENT_INCOME_DEDUCTION","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-income"},"references":["IAS 23 §12"],"exercise":{"prompt":{"fr":"","en":"The company Sorvane borrowed for a plant and temporarily invests the funds not yet spent, earning €9,000. How does it treat this income in calculating the amount to capitalise?","es":""},"explanation":{"fr":"","en":"Temporary investment income is deducted from the eligible amount (IAS 23).","es":""},"common_error":{"fr":"","en":"Not deducting the investment income.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It adds €9,000 to the actual interest cost","es":""},"correct":false,"feedback":{"fr":"","en":"The income eases the financing cost: it is deducted, not added (IAS 23).","es":""}},{"id":"B","text":{"fr":"","en":"It deducts €9,000 from the actual interest cost","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"It disregards this income","es":""},"correct":false,"feedback":{"fr":"","en":"Ignoring the income overstates the amount capitalised: it is part of the calculation (IAS 23).","es":""}},{"id":"D","text":{"fr":"","en":"It records it as income for the year with no other effect","es":""},"correct":false,"feedback":{"fr":"","en":"That treatment leaves the capitalised cost too high: income on borrowed funds is deducted from the eligible amount (IAS 23).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000033","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.ACTUAL_COSTS","IAS23.SPECIFIC.INVESTMENT_INCOME"],"dimension":"CALCULATION","format":"CALCULATION","context":"ENERGY","tested_point":"ELIGIBLE_COST_SPECIFIC","difficulty":"INTERMEDIATE","estimated_time_s":100,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"numeric-specific"},"references":["IAS 23 §12"],"exercise":{"prompt":{"fr":"","en":"The company Hydrane borrows €2,000,000 on 1 January at an effective rate of 6% (loan dedicated to a power plant, case data). Over the first six months, €500,000 remains unspent and is invested at 3% (case data). Calculate the investment income over these six months, then the amount eligible for the year (interest over the full year).","es":""},"explanation":{"fr":"","en":"Income: 500,000 × 3% × 6/12 = €7,500. Actual cost: 2,000,000 × 6% = €120,000. Eligible amount: 120,000 − 7,500 = €112,500 (IAS 23). Rule to remember: eligible amount = actual cost of the period − temporary investment income (IAS 23).","es":""},"common_error":{"fr":"","en":"Calculating the income over twelve months instead of six.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Principal","es":""},"value":"2000000","unit":"EUR"},{"label":{"fr":"","en":"Effective interest rate","es":""},"value":"6","unit":"%"},{"label":{"fr":"","en":"Unspent funds","es":""},"value":"500000","unit":"EUR"},{"label":{"fr":"","en":"Investment rate","es":""},"value":"3","unit":"%"},{"label":{"fr":"","en":"Length of the investment","es":""},"value":"6","unit":"MONTHS"}],"steps":[{"id":"inc","label":{"fr":"","en":"Investment income","es":""},"answer":7500,"tolerance":0,"unit":"EUR"},{"id":"elig","label":{"fr":"","en":"Amount eligible","es":""},"answer":112500,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"elig","meaning":{"fr":"","en":"Amount eligible","es":""},"expression":"(a * b) - c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Principal","es":""},"value":2000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"January at an effective rate of 6%","es":""},"value":6,"unit":"PERCENT"},{"symbol":"c","meaning":{"fr":"","en":"Investment income","es":""},"value":7500,"unit":"EUR"}],"result":112500,"unit":"EUR"}],"rationale":{"fr":"","en":"eligible amount = actual cost of the period − temporary investment income (IAS 23).","es":""},"references":["REF.IAS23.12"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000034","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.ACTUAL_COSTS","IAS23.SPECIFIC.INVESTMENT_INCOME"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"ENERGY","tested_point":"ENTRY_SPECIFIC","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"entry"},"references":["IAS 23 §12"],"exercise":{"prompt":{"fr":"","en":"For the company Hydrane, record in one entry the actual interest of €120,000 capitalised into the power plant under construction and the investment income of €7,500 received and deducted from the cost of the plant.","es":""},"explanation":{"fr":"","en":"Debit asset under construction 120,000 and credit interest payable 120,000; debit cash 7,500 and credit asset under construction 7,500. The net cost of the asset increases by €112,500 (IAS 23). Case convention: illustrative entry; the accounts are those of the course. Rule to remember: the investment income is deducted from the cost of the asset under construction (IAS 23).","es":""},"common_error":{"fr":"","en":"Taking the investment income to profit or loss without deducting it from the asset.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"auc","text":{"fr":"","en":"Asset under construction","es":""}},{"id":"pay","text":{"fr":"","en":"Interest payable","es":""}},{"id":"cash","text":{"fr":"","en":"Cash","es":""}}],"lines":[{"id":"l1","account":"auc","side":"DEBIT","amount":120000,"given":["account","side"]},{"id":"l2","account":"cash","side":"DEBIT","amount":7500},{"id":"l3","account":"pay","side":"CREDIT","amount":120000,"given":["account","side"]},{"id":"l4","account":"auc","side":"CREDIT","amount":7500}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000035","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.ACTUAL_COSTS","IAS23.SPECIFIC.INVESTMENT_INCOME"],"dimension":"RULE_KNOWLEDGE","format":"FILL_BLANK","context":"GENERIC","tested_point":"FORMULA_FILL","difficulty":"INTERMEDIATE","estimated_time_s":45,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-income"},"references":["IAS 23 §12"],"exercise":{"prompt":{"fr":"","en":"Complete the sentence.","es":""},"explanation":{"fr":"","en":"Actual costs are reduced by the investment income (IAS 23). Rule to remember: eligible costs = actual costs of the period − temporary investment income (IAS 23).","es":""},"common_error":{"fr":"","en":"Taking average costs or adding the income.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"For a specific borrowing, eligible amount = {{b1}} costs of the period {{b2}} temporary investment income.","es":""},"blanks":[{"id":"b1","mode":"CHOICE","choices":[{"id":"a","text":{"fr":"","en":"average","es":""}},{"id":"b","text":{"fr":"","en":"actual","es":""}},{"id":"c","text":{"fr":"","en":"estimated","es":""}}],"answer":"b"},{"id":"b2","mode":"CHOICE","choices":[{"id":"a","text":{"fr":"","en":"plus","es":""}},{"id":"b","text":{"fr":"","en":"divided by","es":""}},{"id":"c","text":{"fr":"","en":"minus","es":""}}],"answer":"c"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000036","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.ACTUAL_COSTS","IAS23.SPECIFIC.INVESTMENT_INCOME"],"dimension":"APPLICATION","format":"ORDERING","context":"GENERIC","tested_point":"SPECIFIC_STEPS","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"numeric-specific"},"references":["IAS 23 §12"],"exercise":{"prompt":{"fr":"","en":"Put the steps for calculating the amount eligible for a specific borrowing in order.","es":""},"explanation":{"fr":"","en":"This approach runs from linking to the entry (IAS 23). Approach: link, calculate interest, calculate income, deduct, record; this order is a teaching approach, not imposed by the standard. Rule to remember: one starts from the actual cost of the period and takes off the investment income (IAS 23).","es":""},"common_error":{"fr":"","en":"Deducting the income before calculating the actual interest.","es":""},"format":"ORDERING","steps":[{"id":"s1","text":{"fr":"","en":"Link the borrowing to the qualifying asset from the facts","es":""}},{"id":"s2","text":{"fr":"","en":"Calculate the actual interest of the period at the effective rate","es":""}},{"id":"s3","text":{"fr":"","en":"Calculate the income from investing the unspent funds","es":""}},{"id":"s4","text":{"fr":"","en":"Deduct the income from the actual interest","es":""}},{"id":"s5","text":{"fr":"","en":"Record the amount capitalised into the asset","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000037","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.INVESTMENT_INCOME","IAS23.SPECIFIC.ACTUAL_COSTS"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"GENERIC","tested_point":"SPECIFIC_ERRORS","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"pitfalls"},"references":["IAS 23 §12"],"exercise":{"prompt":{"fr":"","en":"Spot the erroneous statements in a memo on a specific borrowing.","es":""},"explanation":{"fr":"","en":"For a specific borrowing: actual costs less investment income (IAS 23). Rule to remember: eligible costs = actual costs of the period − temporary investment income (IAS 23).","es":""},"common_error":{"fr":"","en":"Adding the income, or using an average rate for a dedicated loan.","es":""},"format":"ERROR_SPOT","statements":[{"id":"e1","text":{"fr":"","en":"Income from the temporary investment of borrowed funds is deducted from the amount eligible.","es":""},"erroneous":false},{"id":"e2","text":{"fr":"","en":"For a specific borrowing, the weighted average rate of all the entity's borrowings is capitalised.","es":""},"erroneous":true,"correction":{"fr":"","en":"The actual costs of the period of the specific borrowing are capitalised, not an average rate (IAS 23, para. 12).","es":""}},{"id":"e3","text":{"fr":"","en":"Investment income is added to actual interest to obtain the amount eligible.","es":""},"erroneous":true,"correction":{"fr":"","en":"The income is deducted from actual interest: it reduces the amount eligible (IAS 23).","es":""}},{"id":"e4","text":{"fr":"","en":"Actual interest for the period is calculated at the effective interest rate.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000038","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.DETAIL"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"DETAIL_RULE","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-detail"},"references":["IAS 23 §13"],"exercise":{"prompt":{"fr":"","en":"The complementary rules on specific borrowings provide that income from temporarily invested borrowed funds reduces the cost capitalised.","es":""},"explanation":{"fr":"","en":"This is the deduction of temporary investment income (IAS 23). Rule to remember: temporary investment income reduces the cost capitalised (IAS 23).","es":""},"common_error":{"fr":"","en":"Treating investment income as having no effect on the cost of the asset.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000039","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.DETAIL"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"CONSTRUCTION","tested_point":"DETAIL_APPLICATION","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS23.000005","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-detail"},"references":["IAS 23 §13"],"exercise":{"prompt":{"fr":"","en":"The company Brévane drew a specific loan for a site project. The funds wait to be spent and are invested. What is the effect of the income on the cost capitalised?","es":""},"explanation":{"fr":"","en":"Income from investing borrowed funds is deducted from the cost capitalised (IAS 23).","es":""},"common_error":{"fr":"","en":"Seeing no effect of the income on the cost of the asset.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The cost capitalised decreases by the amount of the income","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The cost capitalised increases by the amount of the income","es":""},"correct":false,"feedback":{"fr":"","en":"The income reduces the financing cost: the effect goes towards a decrease (IAS 23).","es":""}},{"id":"C","text":{"fr":"","en":"The cost capitalised stays unchanged","es":""},"correct":false,"feedback":{"fr":"","en":"The income on borrowed funds awaiting expenditure is deducted: the cost capitalised changes (IAS 23).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000040","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"WHEN_GENERAL_RATE","difficulty":"BEGINNER","estimated_time_s":50,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"understand"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"The company Fornane builds a warehouse with no dedicated loan, financing the expenditure from all its borrowings. Which rate is used to measure the cost to capitalise?","es":""},"explanation":{"fr":"","en":"For general borrowings, the capitalisation rate, a weighted average of borrowing costs, is applied (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Using the rate of a single loan or a market rate.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The rate of the last loan taken out, whatever its share of the debt","es":""},"correct":false,"feedback":{"fr":"","en":"An isolated loan does not represent general financing: the weighted average is used (IAS 23, para. 14).","es":""}},{"id":"B","text":{"fr":"","en":"The simple average of the nominal rates, without regard to the balance of each borrowing","es":""},"correct":false,"feedback":{"fr":"","en":"The simple average ignores the amounts of the borrowings; the rate is weighted (IAS 23, para. 14).","es":""}},{"id":"C","text":{"fr":"","en":"The market interest rate at closing, regardless of the borrowings actually outstanding","es":""},"correct":false,"feedback":{"fr":"","en":"The market rate is not the entity's borrowing rate: the standard uses its actual weighted borrowing costs (IAS 23, para. 14).","es":""}},{"id":"D","text":{"fr":"","en":"The weighted average of the borrowing costs of the period (capitalisation rate)","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000041","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"SIMPLE_AVERAGE","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-rate"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"To obtain the capitalisation rate, the simple average of the nominal rates of the loans is taken, ignoring their amounts.","es":""},"explanation":{"fr":"","en":"The rate is a weighted average of the borrowing costs of the period (IAS 23, para. 14). Rule to remember: the capitalisation rate is weighted by the borrowings outstanding (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Taking a simple average of rates.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000042","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"RATE_CALC","difficulty":"INTERMEDIATE","estimated_time_s":100,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"numeric-rate"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"The company Gardane has two general borrowings outstanding for the whole year: C of €4,000,000 at 4.5% and D of €1,000,000 at 9% (effective rates, case data). Calculate the total borrowing costs, the total outstanding and the capitalisation rate.","es":""},"explanation":{"fr":"","en":"C: 4,000,000 × 4.5% = €180,000; D: 1,000,000 × 9% = €90,000; total €270,000. Rate = 270,000 ÷ 5,000,000 = 5.4% (IAS 23, para. 14). Case convention: both loans are outstanding all year, so the time weighting is 12/12. Rule to remember: capitalisation rate = borrowing costs of the period ÷ weighted average outstanding (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Taking the simple average of 4.5% and 9% (6.75%).","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Loan C","es":""},"value":"4000000","unit":"EUR"},{"label":{"fr":"","en":"Rate of C","es":""},"value":"4.5","unit":"%"},{"label":{"fr":"","en":"Loan D","es":""},"value":"1000000","unit":"EUR"},{"label":{"fr":"","en":"Rate of D","es":""},"value":"9","unit":"%"}],"steps":[{"id":"cost","label":{"fr":"","en":"Total borrowing costs","es":""},"answer":270000,"tolerance":0,"unit":"EUR"},{"id":"bal","label":{"fr":"","en":"Total outstanding","es":""},"answer":5000000,"tolerance":0,"unit":"EUR"},{"id":"rate","label":{"fr":"","en":"Capitalisation rate","es":""},"answer":5.4,"tolerance":0.01,"unit":"%"}],"formula":{"lines":[{"step":"rate","meaning":{"fr":"","en":"Capitalisation rate","es":""},"expression":"(a / b) * 100","variables":[{"symbol":"a","meaning":{"fr":"","en":"Total borrowing costs","es":""},"value":270000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Total outstanding","es":""},"value":5000000,"unit":"EUR"}],"result":5.4,"unit":"%"}],"rationale":{"fr":"","en":"capitalisation rate = borrowing costs of the period ÷ weighted average outstanding (IAS 23, para. 14).","es":""},"references":["REF.IAS23.14"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000043","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"ELIGIBLE_GENERAL","difficulty":"INTERMEDIATE","estimated_time_s":100,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"numeric-rate"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"The company Gardane (capitalisation rate of 5.4%) builds a warehouse. Its expenditure for the year, time-weighted (case data), is: €800,000 × 12/12 = €800,000; €500,000 × 6/12 = €250,000; €300,000 × 2/12 = €50,000. Calculate the weighted average expenditure and the amount eligible.","es":""},"explanation":{"fr":"","en":"800,000 + 250,000 + 50,000 = 1,100,000; 1,100,000 × 5.4% = €59,400 (IAS 23, para. 14). Case convention: the time weightings are supplied by the case. Rule to remember: amount eligible = weighted average expenditure × capitalisation rate (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Applying the rate to the total expenditure of €1,600,000 without weighting.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Weighted expenditure 1","es":""},"value":"800000","unit":"EUR"},{"label":{"fr":"","en":"Weighted expenditure 2","es":""},"value":"250000","unit":"EUR"},{"label":{"fr":"","en":"Weighted expenditure 3","es":""},"value":"50000","unit":"EUR"},{"label":{"fr":"","en":"Capitalisation rate","es":""},"value":"5.4","unit":"%"}],"steps":[{"id":"wae","label":{"fr":"","en":"Weighted average expenditure","es":""},"answer":1100000,"tolerance":0,"unit":"EUR"},{"id":"elig","label":{"fr":"","en":"Amount eligible","es":""},"answer":59400,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"wae","meaning":{"fr":"","en":"Weighted average expenditure","es":""},"expression":"a + b + c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Weighted expenditure 1","es":""},"value":800000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Weighted expenditure 2","es":""},"value":250000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Weighted expenditure 3","es":""},"value":50000,"unit":"EUR"}],"result":1100000,"unit":"EUR"}],"rationale":{"fr":"","en":"amount eligible = weighted average expenditure × capitalisation rate (IAS 23, para. 14).","es":""},"references":["REF.IAS23.14"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000044","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAP"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"GENERIC","tested_point":"CAP_RULE","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-cap"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"For the company Rovane, the calculated amount is €48,000 and the borrowing costs incurred for the year are €60,000. What amount is capitalised?","es":""},"explanation":{"fr":"","en":"The amount capitalised does not exceed the costs incurred: the lower is taken (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Capitalising the costs incurred as a matter of course.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"€60,000, the costs incurred","es":""},"correct":false,"feedback":{"fr":"","en":"The cap does not raise the amount: the lower is taken, here the calculated amount (IAS 23, para. 14).","es":""}},{"id":"B","text":{"fr":"","en":"€48,000, because the calculated amount is below the costs incurred","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"€108,000, the sum of the two","es":""},"correct":false,"feedback":{"fr":"","en":"The two amounts are not added; they are compared (IAS 23, para. 14).","es":""}},{"id":"D","text":{"fr":"","en":"€12,000, their difference","es":""},"correct":false,"feedback":{"fr":"","en":"The difference is not the amount capitalised: the lower of the two is capitalised (IAS 23, para. 14).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000045","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAP"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"CAP_CALC","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"numeric-cap"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"The company Pentane has a general borrowing of €2,000,000 at 6%. Its weighted average expenditure on a plant is €3,000,000 (the rest is financed by other funds, case data). Calculate the calculated amount, the costs incurred and the amount capitalised.","es":""},"explanation":{"fr":"","en":"3,000,000 × 6% = €180,000; costs incurred 2,000,000 × 6% = €120,000; the lower is €120,000 (IAS 23, para. 14). Rule to remember: the amount capitalised is the lower of the calculated amount and the costs incurred (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Capitalising the calculated €180,000, above the actual costs.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"General loan","es":""},"value":"2000000","unit":"EUR"},{"label":{"fr":"","en":"Rate","es":""},"value":"6","unit":"%"},{"label":{"fr":"","en":"Weighted average expenditure","es":""},"value":"3000000","unit":"EUR"}],"steps":[{"id":"calc","label":{"fr":"","en":"Calculated amount","es":""},"answer":180000,"tolerance":0,"unit":"EUR"},{"id":"inc","label":{"fr":"","en":"Costs incurred","es":""},"answer":120000,"tolerance":0,"unit":"EUR"},{"id":"cap","label":{"fr":"","en":"Amount capitalised","es":""},"answer":120000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000046","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAPITALISATION_RATE","IAS23.GENERAL.CAP"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"MANUFACTURING","tested_point":"ENTRY_GENERAL","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"entry"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"The company Vandelle incurred €310,000 of interest on its general borrowings; €89,900 is capitalised into the warehouse under construction, the balance is an expense. Record the entry.","es":""},"explanation":{"fr":"","en":"Balance in expense: 310,000 − 89,900 = 220,100. Debit asset 89,900 and expense 220,100; credit interest payable 310,000 (IAS 23, para. 14). Rule to remember: the calculated amount (within the costs incurred) is capitalised and the balance of interest is an expense (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Debiting the asset for the full €310,000.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"auc","text":{"fr":"","en":"Asset under construction","es":""}},{"id":"exp","text":{"fr":"","en":"Interest expense","es":""}},{"id":"pay","text":{"fr":"","en":"Interest payable","es":""}}],"lines":[{"id":"l1","account":"auc","side":"DEBIT","amount":89900,"given":["account","side"]},{"id":"l2","account":"exp","side":"DEBIT","amount":220100},{"id":"l3","account":"pay","side":"CREDIT","amount":310000,"given":["account","side"]}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000047","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAPITALISATION_RATE","IAS23.GENERAL.CAP"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"GENERIC","tested_point":"GENERAL_ERRORS","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"pitfalls"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"Spot the erroneous statements in a calculation memo on general borrowings.","es":""},"explanation":{"fr":"","en":"The calculation weights rates and expenditure, then applies the cap of costs incurred (IAS 23, para. 14). Rule to remember: the amount capitalised does not exceed the borrowing costs incurred (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Forgetting time weighting or the cap.","es":""},"format":"ERROR_SPOT","statements":[{"id":"e1","text":{"fr":"","en":"The capitalisation rate is weighted by the borrowing balances.","es":""},"erroneous":false},{"id":"e2","text":{"fr":"","en":"The amount capitalised can exceed the borrowing costs incurred if the expenditure on the asset is high.","es":""},"erroneous":true,"correction":{"fr":"","en":"The amount capitalised does not exceed the borrowing costs incurred during the period (IAS 23, para. 14).","es":""}},{"id":"e3","text":{"fr":"","en":"The rate is applied to the closing expenditure, ignoring the dates of payment.","es":""},"erroneous":true,"correction":{"fr":"","en":"Expenditure is weighted over time: a late payment generates less eligible cost (IAS 23, para. 14).","es":""}},{"id":"e4","text":{"fr":"","en":"The calculated amount is compared with the costs incurred and the lower is taken.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000048","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.RATE_AFTER_2019"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"RATE_AFTER_2019","difficulty":"ADVANCED","estimated_time_s":75,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-after2019"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"The plant financed by specific loan S is ready for use, but S is still largely outstanding. To calculate the capitalisation rate for another qualifying asset, what does the post-2019 text provide?","es":""},"explanation":{"fr":"","en":"The post-2019 text brings S into general borrowings for the rate (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Keeping a specific borrowing outstanding after completion excluded from the rate.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"S joins the general borrowings taken into account in the rate","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"S stays excluded from the rate, as before the amendment","es":""},"correct":false,"feedback":{"fr":"","en":"That is the earlier wording: since 2019, a specific borrowing still outstanding after completion joins general borrowings (IAS 23, para. 14).","es":""}},{"id":"C","text":{"fr":"","en":"S is cancelled in the books on completion","es":""},"correct":false,"feedback":{"fr":"","en":"Completion does not remove the debt; it changes the treatment of its cost in the rate (IAS 23, para. 14).","es":""}},{"id":"D","text":{"fr":"","en":"S is repaid by operation of law on the completion date","es":""},"correct":false,"feedback":{"fr":"","en":"The standard provides no automatic repayment; it deals with the rate calculation (IAS 23, para. 14).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000049","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.RATE_AFTER_2019","IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"RATE_WITH_FORMER_SPECIFIC","difficulty":"EXPERT","estimated_time_s":120,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-after2019"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"An entity has general borrowings of €2,000,000 at 4% (cost €80,000) over the whole year. A former specific borrowing of €2,000,000 at 6% (cost €120,000), still outstanding after its asset was completed, also exists over the whole year (case data). Calculate the capitalisation rate without it and then with it, according to the post-2019 text.","es":""},"explanation":{"fr":"","en":"Without: 80,000 ÷ 2,000,000 = 4%. With: (80,000 + 120,000) ÷ (2,000,000 + 2,000,000) = 200,000 ÷ 4,000,000 = 5% (IAS 23, para. 14). Rule to remember: since 2019, a specific borrowing still outstanding after completion joins the pool of general borrowings (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Leaving the former specific borrowing out of the rate (4%).","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"General borrowings","es":""},"value":"2000000","unit":"EUR"},{"label":{"fr":"","en":"Cost of general borrowings","es":""},"value":"80000","unit":"EUR"},{"label":{"fr":"","en":"Former specific borrowing","es":""},"value":"2000000","unit":"EUR"},{"label":{"fr":"","en":"Cost of the former specific borrowing","es":""},"value":"120000","unit":"EUR"}],"steps":[{"id":"without","label":{"fr":"","en":"Rate without the specific borrowing","es":""},"answer":4,"tolerance":0.01,"unit":"%"},{"id":"with","label":{"fr":"","en":"Rate with the specific borrowing","es":""},"answer":5,"tolerance":0.01,"unit":"%"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000050","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.GROUP_POOLING"],"dimension":"PROFESSIONAL_JUDGMENT","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"GROUP_POOLING","difficulty":"EXPERT","estimated_time_s":90,"lesson_id":"LS.IAS23.000006","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-pooling"},"references":["IAS 23 §15"],"exercise":{"prompt":{"fr":"","en":"The Quelvane group finances its subsidiaries' projects centrally, the parent borrowing for the whole group. A subsidiary builds a qualifying asset. How should the basis of the capitalisation rate be chosen?","es":""},"explanation":{"fr":"","en":"Professional judgement: aggregating group borrowings depends on its financing structure and should be documented; it changes the rate, hence the amount added to the asset and the disclosure of the rate used (IAS 23, para. 15).","es":""},"common_error":{"fr":"","en":"Systematically aggregating all group borrowings without examining the financing structure.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"On the subsidiary's own borrowings, whatever the group's financing structure","es":""},"correct":false,"feedback":{"fr":"","en":"No rule requires sticking to the subsidiary: the group's financing structure can justify a wider average (IAS 23, para. 15).","es":""}},{"id":"B","text":{"fr":"","en":"On the borrowings of all groups in the economy, without regard to the actual financing structure of the entity concerned","es":""},"correct":false,"feedback":{"fr":"","en":"Aggregation concerns the borrowings of the parent and its subsidiaries, and it is not automatic (IAS 23, para. 15).","es":""}},{"id":"C","text":{"fr":"","en":"On the lowest rate in the group, for prudence","es":""},"correct":false,"feedback":{"fr":"","en":"The standard uses a weighted average, not the lowest rate (IAS 23).","es":""}},{"id":"D","text":{"fr":"","en":"By judgement on the financing structure: the calculation may cover the group's borrowings, with the decision documented","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000051","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.CONDITIONS"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"CONSTRUCTION","tested_point":"THREE_ELEMENTS","difficulty":"BEGINNER","estimated_time_s":50,"lesson_id":"LS.IAS23.000007","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"rule-conditions"},"references":["IAS 23 §17"],"exercise":{"prompt":{"fr":"","en":"Which elements must come together for capitalisation of interest to begin?","es":""},"explanation":{"fr":"","en":"The three elements are: expenditure incurred, borrowing costs incurred, preparation in progress (IAS 23, para. 17).","es":""},"common_error":{"fr":"","en":"Confusing the start of capitalisation with the loan signature.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Expenditure incurred, borrowing costs incurred and preparation activities in progress","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Signing the loan and obtaining board approval","es":""},"correct":false,"feedback":{"fr":"","en":"These events are not the three elements used by the standard (IAS 23, para. 17).","es":""}},{"id":"C","text":{"fr":"","en":"Completion of works and entry into service","es":""},"correct":false,"feedback":{"fr":"","en":"Completion marks the end of capitalisation, not its start (IAS 23).","es":""}},{"id":"D","text":{"fr":"","en":"A minimum expenditure amount","es":""},"correct":false,"feedback":{"fr":"","en":"The standard sets no minimum expenditure amount to begin (IAS 23, para. 17).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000052","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.CONDITIONS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"LOAN_SIGNATURE","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS23.000007","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"rule-conditions"},"references":["IAS 23 §17"],"exercise":{"prompt":{"fr":"","en":"The company Hylane signs a loan on 1 July but spends nothing on the asset before 1 October, when its works begin. The interest from July to September is an expense.","es":""},"explanation":{"fr":"","en":"The three elements are not met before 1 October: the interest from July to September is an expense (IAS 23, para. 17). Rule to remember: capitalisation begins when expenditure, borrowing costs and preparation come together (IAS 23, para. 17).","es":""},"common_error":{"fr":"","en":"Starting on the loan signature date.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000053","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.CONDITIONS"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"CONSTRUCTION","tested_point":"COMMENCEMENT_DATE","difficulty":"INTERMEDIATE","estimated_time_s":70,"lesson_id":"LS.IAS23.000007","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"example-commencement"},"references":["IAS 23 §17"],"exercise":{"prompt":{"fr":"","en":"The company Mervane draws its loan on 1 February, makes its first payment to the builder on 1 March and sees works start on 1 April. On what date does capitalisation begin?","es":""},"explanation":{"fr":"","en":"1 April brings together expenditure, borrowing costs and preparation (IAS 23, para. 17).","es":""},"common_error":{"fr":"","en":"Choosing the loan date or the first payment date.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"On 1 February, the date the loan is drawn","es":""},"correct":false,"feedback":{"fr":"","en":"Drawing meets one element (borrowing costs): no expenditure and no preparation (IAS 23, para. 17).","es":""}},{"id":"B","text":{"fr":"","en":"On 1 March, the date of the first payment","es":""},"correct":false,"feedback":{"fr":"","en":"On that date, preparation activities have not yet begun: one element is missing (IAS 23, para. 17).","es":""}},{"id":"C","text":{"fr":"","en":"On 1 January, the start of the year","es":""},"correct":false,"feedback":{"fr":"","en":"The start of the year is not one of the three elements (IAS 23, para. 17).","es":""}},{"id":"D","text":{"fr":"","en":"On 1 April, when the three elements are met","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000054","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.CONDITIONS"],"dimension":"CALCULATION","format":"CALCULATION","context":"CONSTRUCTION","tested_point":"CAPITALISED_FROM_START","difficulty":"INTERMEDIATE","estimated_time_s":100,"lesson_id":"LS.IAS23.000007","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"example-commencement"},"references":["IAS 23 §17"],"exercise":{"prompt":{"fr":"","en":"The company Lorvane has a dedicated loan of €1,800,000 at 6% (effective rate) outstanding all year. The three elements are met on 1 August. With no suspension, calculate the interest capitalised from August to December (5 months) and the interest from January to July (7 months) expensed.","es":""},"explanation":{"fr":"","en":"Annual interest: 1,800,000 × 6% = €108,000. Capitalised: 108,000 × 5/12 = €45,000; expensed: 108,000 × 7/12 = €63,000 (IAS 23, para. 17). Rule to remember: interest after the date on which the three elements come together is eligible for capitalisation (IAS 23, para. 17).","es":""},"common_error":{"fr":"","en":"Capitalising the twelve months of interest.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Dedicated loan","es":""},"value":"1800000","unit":"EUR"},{"label":{"fr":"","en":"Effective rate","es":""},"value":"6","unit":"%"},{"label":{"fr":"","en":"Months of capitalisation","es":""},"value":"5","unit":"MONTHS"}],"steps":[{"id":"cap","label":{"fr":"","en":"Interest capitalised","es":""},"answer":45000,"tolerance":0,"unit":"EUR"},{"id":"exp","label":{"fr":"","en":"Interest expensed","es":""},"answer":63000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000055","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.EXPENDITURE"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"CONSTRUCTION","tested_point":"ELIGIBLE_ITEMS","difficulty":"BEGINNER","estimated_time_s":75,"lesson_id":"LS.IAS23.000007","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"rule-expenditure"},"references":["IAS 23 §18"],"exercise":{"prompt":{"fr":"","en":"Sort each item of the site project of the company Falvane.","es":""},"explanation":{"fr":"","en":"Cash paid and assets transferred are added; progress payments and grants received are deducted; an order neither paid nor delivered does not count yet (IAS 23, para. 18). Rule to remember: eligible expenditure is net of progress payments and grants received (IAS 23, para. 18).","es":""},"common_error":{"fr":"","en":"Counting an unpaid order as expenditure.","es":""},"format":"CLASSIFICATION","categories":[{"id":"in","text":{"fr":"","en":"Counts in eligible expenditure","es":""}},{"id":"out","text":{"fr":"","en":"Is deducted","es":""}},{"id":"no","text":{"fr":"","en":"Does not count yet","es":""}}],"items":[{"id":"i1","text":{"fr":"","en":"Cash payment to the contractor","es":""},"category":"in"},{"id":"i2","text":{"fr":"","en":"Materials transferred to the site (carrying amount)","es":""},"category":"in"},{"id":"i3","text":{"fr":"","en":"Progress payment received","es":""},"category":"out"},{"id":"i4","text":{"fr":"","en":"Grant received in respect of the asset","es":""},"category":"out"},{"id":"i5","text":{"fr":"","en":"Order signed, neither paid nor delivered","es":""},"category":"no"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000056","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.EXPENDITURE"],"dimension":"CALCULATION","format":"CALCULATION","context":"CONSTRUCTION","tested_point":"ELIGIBLE_EXPENDITURE_CALC","difficulty":"INTERMEDIATE","estimated_time_s":110,"lesson_id":"LS.IAS23.000007","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"numeric-expenditure"},"references":["IAS 23 §18"],"exercise":{"prompt":{"fr":"","en":"The company Danvelle builds a hangar. It paid €1,400,000 in cash, transferred parts of €100,000 (carrying amount) and assumed an interest-bearing liability of €200,000. It received a progress payment of €250,000 and a grant of €300,000 linked to the asset (case data). Calculate gross expenditure and eligible expenditure.","es":""},"explanation":{"fr":"","en":"1,400,000 + 100,000 + 200,000 = €1,700,000; 1,700,000 − 250,000 − 300,000 = €1,150,000 (IAS 23, para. 18). Rule to remember: eligible expenditure = cash + assets transferred + interest-bearing liabilities − progress payments − grants (IAS 23, para. 18).","es":""},"common_error":{"fr":"","en":"Not deducting the grant received for the asset.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cash paid","es":""},"value":"1400000","unit":"EUR"},{"label":{"fr":"","en":"Assets transferred","es":""},"value":"100000","unit":"EUR"},{"label":{"fr":"","en":"Interest-bearing liability assumed","es":""},"value":"200000","unit":"EUR"},{"label":{"fr":"","en":"Progress payment received","es":""},"value":"250000","unit":"EUR"},{"label":{"fr":"","en":"Grant received","es":""},"value":"300000","unit":"EUR"}],"steps":[{"id":"gross","label":{"fr":"","en":"Gross expenditure","es":""},"answer":1700000,"tolerance":0,"unit":"EUR"},{"id":"net","label":{"fr":"","en":"Eligible expenditure","es":""},"answer":1150000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"gross","meaning":{"fr":"","en":"Gross expenditure","es":""},"expression":"a + b + c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cash paid","es":""},"value":1400000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Assets transferred","es":""},"value":100000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Interest-bearing liability assumed","es":""},"value":200000,"unit":"EUR"}],"result":1700000,"unit":"EUR"},{"step":"net","meaning":{"fr":"","en":"Eligible expenditure","es":""},"expression":"a - b - c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Gross expenditure","es":""},"value":1700000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Progress payment received","es":""},"value":250000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Grant received","es":""},"value":300000,"unit":"EUR"}],"result":1150000,"unit":"EUR"}],"rationale":{"fr":"","en":"eligible expenditure = cash + assets transferred + interest-bearing liabilities − progress payments − grants (IAS 23, para. 18).","es":""},"references":["REF.IAS23.18"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000057","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.LAND_WITHOUT_DEVELOPMENT"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"REAL_ESTATE","tested_point":"LAND_NO_ACTIVITY","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS23.000007","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"rule-land"},"references":["IAS 23 §19"],"exercise":{"prompt":{"fr":"","en":"The company Sarvane buys land with a loan and leaves it waiting, with no development activity. How does it treat the interest on the loan?","es":""},"explanation":{"fr":"","en":"Land waiting with no activity does not give rise to capitalisation (IAS 23).","es":""},"common_error":{"fr":"","en":"Capitalising the interest on land held with no preparation activity.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It capitalises them into the land because it is financed by borrowing","es":""},"correct":false,"feedback":{"fr":"","en":"Financing is not enough: with no development activity, preparation activities are not in progress (IAS 23).","es":""}},{"id":"B","text":{"fr":"","en":"It capitalises half of them","es":""},"correct":false,"feedback":{"fr":"","en":"The standard provides no partial capitalisation of this kind (IAS 23).","es":""}},{"id":"C","text":{"fr":"","en":"It expenses them: no capitalisation as long as no activity takes place","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"It capitalises them from the second year of holding","es":""},"correct":false,"feedback":{"fr":"","en":"The length of holding does not replace development activity (IAS 23).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000058","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.CONDITIONS","IAS23.COMMENCEMENT.EXPENDITURE"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"GENERIC","tested_point":"COMMENCEMENT_ERRORS","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS23.000007","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"pitfalls"},"references":["IAS 23 §17","IAS 23 §18"],"exercise":{"prompt":{"fr":"","en":"Spot the erroneous statements in a memo on the start of capitalisation.","es":""},"explanation":{"fr":"","en":"The start depends on the three elements coming together; eligible expenditure is net of progress payments and grants (IAS 23, para. 17) (IAS 23, para. 18). Rule to remember: eligible expenditure excludes what is funded by a grant received for the asset (IAS 23, para. 18).","es":""},"common_error":{"fr":"","en":"Starting at loan signature and forgetting the deductions.","es":""},"format":"ERROR_SPOT","statements":[{"id":"e1","text":{"fr":"","en":"Eligible expenditure is net of progress payments received.","es":""},"erroneous":false},{"id":"e2","text":{"fr":"","en":"Capitalisation begins on the loan signature date, even if no expenditure has been incurred.","es":""},"erroneous":true,"correction":{"fr":"","en":"Expenditure, borrowing costs and preparation activities must come together (IAS 23, para. 17).","es":""}},{"id":"e3","text":{"fr":"","en":"A grant received for the asset increases eligible expenditure.","es":""},"erroneous":true,"correction":{"fr":"","en":"Grants received in respect of the asset are deducted from eligible expenditure (IAS 23, para. 18).","es":""}},{"id":"e4","text":{"fr":"","en":"An interest-bearing liability assumed for the asset is part of eligible expenditure.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000059","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.CONDITIONS","IAS23.COMMENCEMENT.LAND_WITHOUT_DEVELOPMENT"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"REAL_ESTATE","tested_point":"PREPARATION_IN_PROGRESS","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS23.000007","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"judgment"},"references":["IAS 23 §17","IAS 23 §19"],"exercise":{"prompt":{"fr":"","en":"Dating the start of capitalisation for a project of the company Orvelle.","es":""},"explanation":{"fr":"","en":"Professional judgement: the date used rests on the facts (actual start of the site) and should be documented; it splits the annual interest of €60,000 equally between expense and asset (IAS 23, para. 17). Rule to remember: capitalisation begins when expenditure, borrowing costs and preparation come together (IAS 23, para. 17).","es":""},"common_error":{"fr":"","en":"Dating the start at the purchase of the land.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Teaching assumption: the fictitious company Orvelle buys land on 1 January with a dedicated loan of €1,200,000 at 5% (effective rate). No activity takes place until 1 July, when a construction site for a logistics centre starts with a first payment to the contractor.","es":""},"parts":[{"prompt":{"fr":"","en":"On what date does capitalisation begin?","es":""},"explanation":{"fr":"","en":"The three elements come together on 1 July (IAS 23, para. 17).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"On 1 January, because the land is bought with the loan","es":""},"correct":false,"feedback":{"fr":"","en":"Land waiting with no activity does not give rise to capitalisation (IAS 23).","es":""}},{"id":"B","text":{"fr":"","en":"On 1 April, in the middle of the waiting period","es":""},"correct":false,"feedback":{"fr":"","en":"Nothing happens on 1 April: preparation has not begun (IAS 23, para. 17).","es":""}},{"id":"C","text":{"fr":"","en":"On 1 July, when expenditure and preparation activities join the borrowing costs","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"On 31 December, at the year end","es":""},"correct":false,"feedback":{"fr":"","en":"The year end is not one of the three elements: capitalisation begins as soon as they come together (IAS 23, para. 17).","es":""}}],"id":"p1","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"Calculate the interest capitalised (1 July to 31 December, 6 months) and the interest expensed (January to June, 6 months).","es":""},"explanation":{"fr":"","en":"Annual interest 1,200,000 × 5% = €60,000; each half-year €30,000 (IAS 23, para. 17). Rule to remember: interest before the start date is an expense (IAS 23, para. 17).","es":""},"common_error":{"fr":"","en":"Capitalising the whole year's interest: interest before the commencement date is expensed.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Dedicated loan","es":""},"value":"1200000","unit":"EUR"},{"label":{"fr":"","en":"Effective rate","es":""},"value":"5","unit":"%"}],"steps":[{"id":"cap","label":{"fr":"","en":"Interest capitalised","es":""},"answer":30000,"tolerance":0,"unit":"EUR"},{"id":"exp","label":{"fr":"","en":"Interest expensed","es":""},"answer":30000,"tolerance":0,"unit":"EUR"}],"id":"p2","dimension":"CALCULATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000060","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXTENDED_PERIODS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"CONSTRUCTION","tested_point":"SUSPENSION_RULE","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS23.000008","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"rule-suspension"},"references":["IAS 23 §20"],"exercise":{"prompt":{"fr":"","en":"The company Kelvane suspends capitalising its interest during several months of complete site stoppage, caused by a dispute that blocks all activity. This practice complies with the standard.","es":""},"explanation":{"fr":"","en":"Capitalisation is suspended during extended periods of interrupted active development (IAS 23, para. 20). Rule to remember: capitalisation is suspended during an extended interruption of active development (IAS 23, para. 20).","es":""},"common_error":{"fr":"","en":"Continuing to capitalise interest while the site is stopped.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000061","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXTENDED_PERIODS"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"CONSTRUCTION","tested_point":"SUSPENDED_INTEREST","difficulty":"BEGINNER","estimated_time_s":50,"lesson_id":"LS.IAS23.000008","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"rule-suspension"},"references":["IAS 23 §20"],"exercise":{"prompt":{"fr":"","en":"During an extended interruption of active development of a qualifying asset, how is the interest on the dedicated loan treated?","es":""},"explanation":{"fr":"","en":"Interest for the suspension period is an expense (IAS 23, para. 20).","es":""},"common_error":{"fr":"","en":"Continuing to capitalise during suspension.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"They continue to be capitalised into the cost of the asset","es":""},"correct":false,"feedback":{"fr":"","en":"Capitalisation is suspended: the asset no longer advances while financing costs money (IAS 23, para. 20).","es":""}},{"id":"B","text":{"fr":"","en":"They are deferred to the end of construction","es":""},"correct":false,"feedback":{"fr":"","en":"The standard provides no deferral: the interest of the suspension period is an expense (IAS 23, para. 20).","es":""}},{"id":"C","text":{"fr":"","en":"They are cancelled since the site is stopped","es":""},"correct":false,"feedback":{"fr":"","en":"The loan keeps accruing interest: it remains due and is recognised as an expense (IAS 23, para. 20).","es":""}},{"id":"D","text":{"fr":"","en":"They are recognised as an expense of the period","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000062","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXTENDED_PERIODS"],"dimension":"CALCULATION","format":"CALCULATION","context":"CONSTRUCTION","tested_point":"SUSPENSION_CALC","difficulty":"INTERMEDIATE","estimated_time_s":100,"lesson_id":"LS.IAS23.000008","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"numeric-suspension"},"references":["IAS 23 §20"],"exercise":{"prompt":{"fr":"","en":"The company Dalvane has a dedicated loan of €2,400,000 at 6% (effective rate) outstanding all year. Its site is interrupted for an extended period of 5 months (case judgement). Calculate the interest capitalised (7 months) and expensed (5 months).","es":""},"explanation":{"fr":"","en":"Monthly interest: 2,400,000 × 6% ÷ 12 = €12,000. Capitalised: 7 × €12,000 = €84,000; expense: 5 × €12,000 = €60,000 (IAS 23, para. 20). Case convention: the 5-month duration is a case datum and judgement, not a threshold from the standard. Rule to remember: interest for the months of extended interruption is not capitalised (IAS 23, para. 20).","es":""},"common_error":{"fr":"","en":"Capitalising the twelve months of interest.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Dedicated loan","es":""},"value":"2400000","unit":"EUR"},{"label":{"fr":"","en":"Effective rate","es":""},"value":"6","unit":"%"},{"label":{"fr":"","en":"Months of interruption","es":""},"value":"5","unit":"MONTHS"}],"steps":[{"id":"cap","label":{"fr":"","en":"Interest capitalised","es":""},"answer":84000,"tolerance":0,"unit":"EUR"},{"id":"exp","label":{"fr":"","en":"Interest expensed","es":""},"answer":60000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000063","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXTENDED_PERIODS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"CONSTRUCTION","tested_point":"SUSPENSION_ENTRY","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS23.000008","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"entry"},"references":["IAS 23 §20"],"exercise":{"prompt":{"fr":"","en":"For the company Dalvane, record in one entry the annual interest of €144,000: €84,000 capitalised into the work under construction, the balance in expense (interruption period).","es":""},"explanation":{"fr":"","en":"Debit asset 84,000; debit expense 60,000; credit interest payable 144,000. Total debits 144,000 = total credits 144,000 (IAS 23, para. 20). Rule to remember: interest for the suspension period is recognised as an expense (IAS 23, para. 20).","es":""},"common_error":{"fr":"","en":"Debiting the asset for all the annual interest.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"auc","text":{"fr":"","en":"Asset under construction","es":""}},{"id":"exp","text":{"fr":"","en":"Interest expense","es":""}},{"id":"pay","text":{"fr":"","en":"Interest payable","es":""}}],"lines":[{"id":"l1","account":"auc","side":"DEBIT","amount":84000,"given":["account","side"]},{"id":"l2","account":"exp","side":"DEBIT","amount":60000},{"id":"l3","account":"pay","side":"CREDIT","amount":144000,"given":["account","side"]}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000064","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXCEPTIONS"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"CONSTRUCTION","tested_point":"TEMPORARY_DELAY","difficulty":"BEGINNER","estimated_time_s":60,"lesson_id":"LS.IAS23.000008","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"rule-exceptions"},"references":["IAS 23 §21"],"exercise":{"prompt":{"fr":"","en":"A site waits three weeks for the result of a conformity test required by the asset preparation process. Meanwhile, the entity keeps paying interest. What should be done?","es":""},"explanation":{"fr":"","en":"A temporary delay inherent in the process does not suspend capitalisation (IAS 23, para. 21).","es":""},"common_error":{"fr":"","en":"Suspending capitalisation during substantial technical and administrative work.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Suspend capitalisation from the first day of waiting","es":""},"correct":false,"feedback":{"fr":"","en":"A temporary delay inherent in the process does not suspend capitalisation (IAS 23, para. 21).","es":""}},{"id":"B","text":{"fr":"","en":"Suspend capitalisation because the wait exceeds two consecutive weeks","es":""},"correct":false,"feedback":{"fr":"","en":"The standard sets no two-week threshold; the cause (inherent delay) matters (IAS 23, para. 21).","es":""}},{"id":"C","text":{"fr":"","en":"Keep capitalising: the temporary delay is inherent in the process","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"Expense the interest of these three weeks out of prudence","es":""},"correct":false,"feedback":{"fr":"","en":"Prudence does not replace the rule: without suspension, this interest stays capitalised (IAS 23, para. 21).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000065","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXCEPTIONS","IAS23.SUSPENSION.EXTENDED_PERIODS"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"CONSTRUCTION","tested_point":"SUSPEND_OR_CONTINUE","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS23.000008","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"rule-exceptions"},"references":["IAS 23 §21","IAS 23 §20"],"exercise":{"prompt":{"fr":"","en":"Sort each site situation: is capitalisation suspended or does it continue?","es":""},"explanation":{"fr":"","en":"An extended interruption of active development suspends; substantial technical and administrative work and an inherent delay do not (IAS 23, para. 20) (IAS 23, para. 21). Rule to remember: suspension targets extended interruption of active development, not technical work or inherent delays (IAS 23, para. 20) (IAS 23, para. 21).","es":""},"common_error":{"fr":"","en":"Suspending as soon as no physical work is visible on the site.","es":""},"format":"CLASSIFICATION","categories":[{"id":"susp","text":{"fr":"","en":"Capitalisation is suspended","es":""}},{"id":"cont","text":{"fr":"","en":"Capitalisation continues","es":""}}],"items":[{"id":"i1","text":{"fr":"","en":"Complete stop of all activity for several months because of a dispute","es":""},"category":"susp"},{"id":"i2","text":{"fr":"","en":"Substantial technical studies and administrative procedures carried out during the period","es":""},"category":"cont"},{"id":"i3","text":{"fr":"","en":"Waiting for the conformity test required by the process","es":""},"category":"cont"},{"id":"i4","text":{"fr":"","en":"Site left with no activity for a long period","es":""},"category":"susp"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000066","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXCEPTIONS"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MULTIPLE_CHOICE","context":"CONSTRUCTION","tested_point":"JUDGEMENT_EXTENDED_OR_TEMPORARY","difficulty":"ADVANCED","estimated_time_s":100,"lesson_id":"LS.IAS23.000008","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"judgment"},"references":["IAS 23 §21"],"exercise":{"prompt":{"fr":"","en":"To assess whether an interruption suspends capitalisation, which elements should the facts shed light on?","es":""},"explanation":{"fr":"","en":"Professional judgement: the cause and the state of active development are the facts to document, with no numerical threshold (IAS 23) (IAS 23, para. 21). Rule to remember: an extended interruption is judged on the facts, with no imposed duration (IAS 23).","es":""},"common_error":{"fr":"","en":"Setting a numerical duration as if the standard required it.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The entity's cash level","es":""},"correct":false,"feedback":{"fr":"","en":"Cash does not determine whether active development is interrupted (IAS 23).","es":""}},{"id":"B","text":{"fr":"","en":"The cause of the stop (inherent process or blockage)","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The state of active development during the period","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"A minimum number of days of stoppage","es":""},"correct":false,"feedback":{"fr":"","en":"The standard sets no number of days: \"extended\" is a judgement based on the facts (IAS 23).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000067","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXTENDED_PERIODS","IAS23.SUSPENSION.EXCEPTIONS"],"dimension":"CALCULATION","format":"MINI_CASE","context":"CONSTRUCTION","tested_point":"SUSPENSION_MINI_CASE","difficulty":"ADVANCED","estimated_time_s":160,"lesson_id":"LS.IAS23.000008","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"judgment"},"references":["IAS 23 §20","IAS 23 §21"],"exercise":{"prompt":{"fr":"","en":"Treating two stoppages of the same site of the company Pavane.","es":""},"explanation":{"fr":"","en":"Professional judgement: classifying the two stops rests on the cause and the state of active development and should be documented; suspension reduces the asset by €30,000 and increases the interest expense by the same amount (IAS 23, para. 20) (IAS 23, para. 21). Rule to remember: an extended interruption of active development suspends capitalisation (IAS 23, para. 20).","es":""},"common_error":{"fr":"","en":"Suspending for any stop, whatever the cause.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Teaching assumption: the fictitious company Pavane builds a plant with a dedicated loan of €3,000,000 at 4% (effective rate), i.e. €10,000 of interest a month. First stop: three weeks waiting for a conformity test required by the process. Second stop: three months of complete stoppage of all activity because of a dispute with a supplier (extended interruption, case judgement).","es":""},"parts":[{"prompt":{"fr":"","en":"What is the effect of each stop on capitalisation?","es":""},"explanation":{"fr":"","en":"The extended interruption suspends; the inherent delay does not (IAS 23, para. 20) (IAS 23, para. 21).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Both suspend capitalisation","es":""},"correct":false,"feedback":{"fr":"","en":"The delay linked to the conformity test is inherent in the process: it does not suspend (IAS 23, para. 21).","es":""}},{"id":"B","text":{"fr":"","en":"The first does not suspend; the second suspends","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Neither suspends capitalisation","es":""},"correct":false,"feedback":{"fr":"","en":"The complete three-month stoppage, judged extended, suspends capitalisation (IAS 23, para. 20).","es":""}},{"id":"D","text":{"fr":"","en":"The first suspends; the second does not","es":""},"correct":false,"feedback":{"fr":"","en":"It is the other way round: the inherent delay does not suspend, the extended stoppage does (IAS 23, para. 20) (IAS 23, para. 21).","es":""}}],"id":"p1","dimension":"RECOGNITION"},{"prompt":{"fr":"","en":"Over 12 months, calculate the interest expensed during the suspension (3 months) and the interest capitalised (9 months).","es":""},"explanation":{"fr":"","en":"3 × €10,000 = €30,000 expensed; 9 × €10,000 = €90,000 capitalised (IAS 23, para. 20). Rule to remember: the months of extended interruption drop out of capitalisation (IAS 23, para. 20).","es":""},"common_error":{"fr":"","en":"Continuing to capitalise during the extended suspension: interest for those months is expensed.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Monthly interest","es":""},"value":"10000","unit":"EUR"},{"label":{"fr":"","en":"Months of suspension","es":""},"value":"3","unit":"MONTHS"}],"steps":[{"id":"exp","label":{"fr":"","en":"Interest expensed","es":""},"answer":30000,"tolerance":0,"unit":"EUR"},{"id":"cap","label":{"fr":"","en":"Interest capitalised","es":""},"answer":90000,"tolerance":0,"unit":"EUR"}],"id":"p2","dimension":"CALCULATION","formula":{"lines":[{"step":"exp","meaning":{"fr":"","en":"Interest expensed","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Months of suspension","es":""},"value":3,"unit":"MONTHS"},{"symbol":"b","meaning":{"fr":"","en":"Monthly interest","es":""},"value":10000,"unit":"EUR"}],"result":30000,"unit":"EUR"},{"step":"cap","meaning":{"fr":"","en":"Interest capitalised","es":""},"expression":"9 * a","variables":[{"symbol":"a","meaning":{"fr":"","en":"Monthly interest","es":""},"value":10000,"unit":"EUR"}],"result":90000,"unit":"EUR"}],"rationale":{"fr":"","en":"the months of extended interruption drop out of capitalisation (IAS 23, para. 20).","es":""},"references":["REF.IAS23.20"]}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000068","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.SUBSTANTIALLY_ALL"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"CESSATION_RULE","difficulty":"BEGINNER","estimated_time_s":50,"lesson_id":"LS.IAS23.000009","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000009","section_id":"rule-cessation"},"references":["IAS 23 §22"],"exercise":{"prompt":{"fr":"","en":"The company Gélane completes, on 30 June, substantially all the activities necessary for its plant to be ready for use. What does it do with the interest on the construction loan from 1 July?","es":""},"explanation":{"fr":"","en":"After substantial completion, interest is an expense (IAS 23, para. 22).","es":""},"common_error":{"fr":"","en":"Continuing to capitalise interest after the asset enters service.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It recognises them as an expense: capitalisation has ceased","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"It capitalises them until the loan is repaid","es":""},"correct":false,"feedback":{"fr":"","en":"Repayment is not the end criterion: substantial completion of preparation is (IAS 23, para. 22).","es":""}},{"id":"C","text":{"fr":"","en":"It capitalises them until the end of the year","es":""},"correct":false,"feedback":{"fr":"","en":"The year end does not extend capitalisation after completion (IAS 23, para. 22).","es":""}},{"id":"D","text":{"fr":"","en":"It capitalises half of them for six months","es":""},"correct":false,"feedback":{"fr":"","en":"No tapering capitalisation is provided: after the end date, this interest is an expense (IAS 23, para. 22).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000069","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.SUBSTANTIALLY_ALL"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"MANUFACTURING","tested_point":"MINOR_FINISHING","difficulty":"BEGINNER","estimated_time_s":55,"lesson_id":"LS.IAS23.000009","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000009","section_id":"rule-cessation"},"references":["IAS 23 §22"],"exercise":{"prompt":{"fr":"","en":"The last, minor painting works on a building continue after substantially all preparation activities are complete. Capitalisation of interest continues until these works end.","es":""},"explanation":{"fr":"","en":"Capitalisation ceases at substantial completion, without waiting for every task (IAS 23, para. 22). Rule to remember: completion is substantial: minor finishing does not prevent the end of capitalisation (IAS 23, para. 22).","es":""},"common_error":{"fr":"","en":"Waiting for the last minor task to be done.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000070","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.SUBSTANTIALLY_ALL"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"CESSATION_CALC","difficulty":"INTERMEDIATE","estimated_time_s":100,"lesson_id":"LS.IAS23.000009","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000009","section_id":"numeric-cessation"},"references":["IAS 23 §22"],"exercise":{"prompt":{"fr":"","en":"The company Odrane has a dedicated loan of €3,600,000 at 5% (effective rate), outstanding all year. Capitalisation begins on 1 January; substantial completion occurs on 30 June (case judgement). Calculate the interest capitalised (6 months) and expensed (6 months).","es":""},"explanation":{"fr":"","en":"Annual interest: 3,600,000 × 5% = €180,000; six months: €90,000 capitalised and €90,000 expensed (IAS 23, para. 22). Rule to remember: interest after the date of substantial completion is an expense (IAS 23, para. 22).","es":""},"common_error":{"fr":"","en":"Capitalising the twelve months of interest.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Dedicated loan","es":""},"value":"3600000","unit":"EUR"},{"label":{"fr":"","en":"Effective rate","es":""},"value":"5","unit":"%"},{"label":{"fr":"","en":"Months of capitalisation","es":""},"value":"6","unit":"MONTHS"}],"steps":[{"id":"cap","label":{"fr":"","en":"Interest capitalised","es":""},"answer":90000,"tolerance":0,"unit":"EUR"},{"id":"exp","label":{"fr":"","en":"Interest expensed","es":""},"answer":90000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000071","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.SUBSTANTIALLY_ALL"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"MANUFACTURING","tested_point":"TRANSFER_TO_PPE","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS23.000009","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000009","section_id":"entry"},"references":["IAS 23 §22"],"exercise":{"prompt":{"fr":"","en":"The company Odrane completes its production line: the accumulated cost of the asset under construction is €4,400,000 of expenditure and €180,000 of capitalised borrowing costs. Record the transfer entry to property, plant and equipment.","es":""},"explanation":{"fr":"","en":"4,400,000 + 180,000 = 4,580,000. Debit property, plant and equipment and credit asset under construction for €4,580,000; the entry includes the capitalised interest (IAS 23, para. 22). Rule to remember: on completion, the accumulated cost, including capitalised interest, is transferred to the asset in service (IAS 23, para. 22).","es":""},"common_error":{"fr":"","en":"Leaving the capitalised interest out of the cost transferred.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"ppe","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"auc","text":{"fr":"","en":"Asset under construction","es":""}}],"lines":[{"id":"l1","account":"ppe","side":"DEBIT","amount":4580000,"given":["account","side"]},{"id":"l2","account":"auc","side":"CREDIT","amount":4580000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000072","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.SUBSTANTIALLY_ALL"],"dimension":"APPLICATION","format":"ORDERING","context":"GENERIC","tested_point":"LIFECYCLE_ORDER","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS23.000009","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000009","section_id":"rule-cessation"},"references":["IAS 23 §22"],"exercise":{"prompt":{"fr":"","en":"Put the stages of the capitalisation life cycle for a qualifying asset in order.","es":""},"explanation":{"fr":"","en":"Start, development, suspension, resumption and end (IAS 23) (IAS 23) (IAS 23, para. 22). Approach: this order illustrates a case in which an interruption occurs; it is a teaching sequence, not imposed by the standard. Rule to remember: capitalisation begins, may be suspended then resume, and ceases at substantial completion (IAS 23) (IAS 23) (IAS 23, para. 22).","es":""},"common_error":{"fr":"","en":"Placing the end of capitalisation before the resumption.","es":""},"format":"ORDERING","steps":[{"id":"s1","text":{"fr":"","en":"Expenditure, borrowing costs and preparation come together: capitalisation begins","es":""}},{"id":"s2","text":{"fr":"","en":"Active development continues: interest is capitalised","es":""}},{"id":"s3","text":{"fr":"","en":"An extended interruption occurs: capitalisation is suspended","es":""}},{"id":"s4","text":{"fr":"","en":"Active development resumes: capitalisation resumes","es":""}},{"id":"s5","text":{"fr":"","en":"Substantially all activities are complete: capitalisation ceases","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000073","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.SUBSTANTIALLY_ALL"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"MANUFACTURING","tested_point":"CESSATION_ERRORS","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS23.000009","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000009","section_id":"pitfalls"},"references":["IAS 23 §22"],"exercise":{"prompt":{"fr":"","en":"Spot the erroneous statements in a memo on the end of capitalisation.","es":""},"explanation":{"fr":"","en":"The end depends on substantial completion; the transfer takes the complete cost (IAS 23, para. 22). Rule to remember: capitalisation ceases at substantial completion of the preparation activities (IAS 23, para. 22).","es":""},"common_error":{"fr":"","en":"Linking the end of capitalisation to repayment or to the last task.","es":""},"format":"ERROR_SPOT","statements":[{"id":"e1","text":{"fr":"","en":"Capitalisation ceases when substantially all preparation activities are complete.","es":""},"erroneous":false},{"id":"e2","text":{"fr":"","en":"Interest continues to be capitalised as long as the loan is not repaid.","es":""},"erroneous":true,"correction":{"fr":"","en":"Repayment is not the criterion: capitalisation ceases at substantial completion (IAS 23, para. 22).","es":""}},{"id":"e3","text":{"fr":"","en":"A remaining minor finishing task requires capitalisation to continue.","es":""},"erroneous":true,"correction":{"fr":"","en":"Completion is substantial: minor finishing does not require continuing (IAS 23, para. 22).","es":""}},{"id":"e4","text":{"fr":"","en":"The accumulated cost, including capitalised interest, is transferred to the asset in service.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000074","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.PARTS_COMPLETED"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"PARTS_COMPLETED","difficulty":"ADVANCED","estimated_time_s":75,"lesson_id":"LS.IAS23.000009","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000009","section_id":"rule-parts"},"references":["IAS 23 §23","IAS 23 §24","IAS 23 §25"],"exercise":{"prompt":{"fr":"","en":"An industrial complex comprises two blocks. Block 1 is complete and usable on its own; block 2 is still under construction. What happens to capitalisation for block 1?","es":""},"explanation":{"fr":"","en":"Capitalisation ceases for the completed, usable part and continues for the others (IAS 23).","es":""},"common_error":{"fr":"","en":"Waiting for the whole to be completed before ceasing on a part already usable.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It continues for both blocks until the whole is complete","es":""},"correct":false,"feedback":{"fr":"","en":"Waiting for the whole amounts to capitalising on a part already usable (IAS 23).","es":""}},{"id":"B","text":{"fr":"","en":"It ceases for both blocks as soon as block 1 is complete","es":""},"correct":false,"feedback":{"fr":"","en":"Block 2 is still being prepared: capitalisation continues there (IAS 23).","es":""}},{"id":"C","text":{"fr":"","en":"It depends on no part: the whole counts","es":""},"correct":false,"feedback":{"fr":"","en":"The text deals with completion of the separately usable part (IAS 23).","es":""}},{"id":"D","text":{"fr":"","en":"It ceases for block 1 and continues for block 2","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000075","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.PARTS_COMPLETED","IAS23.CESSATION.SUBSTANTIALLY_ALL"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"MANUFACTURING","tested_point":"PARTS_MINI_CASE","difficulty":"EXPERT","estimated_time_s":160,"lesson_id":"LS.IAS23.000009","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000009","section_id":"rule-parts"},"references":["IAS 23 §23","IAS 23 §24","IAS 23 §25","IAS 23 §22"],"exercise":{"prompt":{"fr":"","en":"Treating two blocks of an industrial complex of the company Ulvane.","es":""},"explanation":{"fr":"","en":"Professional judgement: classing block 1 as a completed, separately usable part rests on the facts (start of operation, independence) and should be documented; for the year, €240,000 is capitalised and €60,000 is an expense (IAS 23, para. 22). Rule to remember: capitalisation ceases on the completed part without waiting for the whole (IAS 23).","es":""},"common_error":{"fr":"","en":"Continuing to capitalise block 1 interest until block 2 is complete.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Teaching assumption: the fictitious company Ulvane builds a complex of two blocks, each financed by its own dedicated loan (case data). Block 1: loan of €2,400,000 at 5%, i.e. €10,000 of interest a month. Block 2: loan of €3,600,000 at 5%, i.e. €15,000 of interest a month. Block 1 is complete and separately usable after 6 months; block 2 is under construction for all 12 months of the year.","es":""},"parts":[{"prompt":{"fr":"","en":"Calculate the interest capitalised for each block over the year.","es":""},"explanation":{"fr":"","en":"Block 1: 6 × €10,000 = €60,000; block 2: 12 × €15,000 = €180,000 (IAS 23). Rule to remember: capitalisation ceases for the completed, usable block and continues for the other (IAS 23).","es":""},"common_error":{"fr":"","en":"Capitalising 12 months for both blocks: capitalisation stops for the block that is complete and usable.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Monthly interest block 1","es":""},"value":"10000","unit":"EUR"},{"label":{"fr":"","en":"Monthly interest block 2","es":""},"value":"15000","unit":"EUR"}],"steps":[{"id":"b1","label":{"fr":"","en":"Capitalised into block 1","es":""},"answer":60000,"tolerance":0,"unit":"EUR"},{"id":"b2","label":{"fr":"","en":"Capitalised into block 2","es":""},"answer":180000,"tolerance":0,"unit":"EUR"}],"id":"p1","dimension":"CALCULATION","formula":{"lines":[{"step":"b1","meaning":{"fr":"","en":"Capitalised into block 1","es":""},"expression":"6 * a","variables":[{"symbol":"a","meaning":{"fr":"","en":"Monthly interest block 1","es":""},"value":10000,"unit":"EUR"}],"result":60000,"unit":"EUR"},{"step":"b2","meaning":{"fr":"","en":"Capitalised into block 2","es":""},"expression":"12 * a","variables":[{"symbol":"a","meaning":{"fr":"","en":"Monthly interest block 2","es":""},"value":15000,"unit":"EUR"}],"result":180000,"unit":"EUR"}],"rationale":{"fr":"","en":"capitalisation ceases for the completed, usable block and continues for the other (IAS 23).","es":""},"references":["REF.IAS23.23","REF.IAS23.24","REF.IAS23.25","REF.IAS23.22"]}},{"prompt":{"fr":"","en":"Calculate the block 1 interest expensed over the year (last 6 months).","es":""},"explanation":{"fr":"","en":"6 × €10,000 = €60,000 expensed (IAS 23). Rule to remember: after the usable part is complete, its interest is an expense (IAS 23).","es":""},"common_error":{"fr":"","en":"Continuing to capitalise interest on the completed block: after that usable part is complete, it is expensed.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Monthly interest block 1","es":""},"value":"10000","unit":"EUR"},{"label":{"fr":"","en":"Months after completion","es":""},"value":"6","unit":"MONTHS"}],"steps":[{"id":"exp","label":{"fr":"","en":"Block 1 interest expensed","es":""},"answer":60000,"tolerance":0,"unit":"EUR"}],"id":"p2","dimension":"CALCULATION","formula":{"lines":[{"step":"exp","meaning":{"fr":"","en":"Block 1 interest expensed","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Months after completion","es":""},"value":6,"unit":"MONTHS"},{"symbol":"b","meaning":{"fr":"","en":"Monthly interest block 1","es":""},"value":10000,"unit":"EUR"}],"result":60000,"unit":"EUR"}],"rationale":{"fr":"","en":"after the usable part is complete, its interest is an expense (IAS 23).","es":""},"references":["REF.IAS23.23","REF.IAS23.24","REF.IAS23.25","REF.IAS23.22"]}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000076","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DISCLOSURE.AMOUNT"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"DISCLOSURE_AMOUNT","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS23.000010","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000010","section_id":"rule-disclosure"},"references":["IAS 23 §26"],"exercise":{"prompt":{"fr":"","en":"An entity that has capitalised borrowing costs into its assets under construction discloses the amount for the period in its notes.","es":""},"explanation":{"fr":"","en":"The amount capitalised in the period is one of the disclosures (IAS 23, para. 26). Rule to remember: the amount of borrowing costs capitalised in the period is disclosed in the notes (IAS 23, para. 26).","es":""},"common_error":{"fr":"","en":"Considering that capitalisation needs no disclosure.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000077","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DISCLOSURE.CAPITALISATION_RATE"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"GENERIC","tested_point":"DISCLOSURE_RATE","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS23.000010","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000010","section_id":"rule-disclosure"},"references":["IAS 23 §26"],"exercise":{"prompt":{"fr":"","en":"Besides the amount capitalised, what information do the notes give on the calculation?","es":""},"explanation":{"fr":"","en":"The notes give the amount capitalised and the capitalisation rate used (IAS 23, para. 26).","es":""},"common_error":{"fr":"","en":"Omitting the capitalisation rate used.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The name of the lending bank","es":""},"correct":false,"feedback":{"fr":"","en":"This information is not asked for: the standard targets the amount and the rate (IAS 23, para. 26).","es":""}},{"id":"B","text":{"fr":"","en":"The detail of site salaries","es":""},"correct":false,"feedback":{"fr":"","en":"Site salaries are not borrowing costs; they are not the subject of this disclosure (IAS 23, para. 26).","es":""}},{"id":"C","text":{"fr":"","en":"The capitalisation rate used","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"The loan signature date","es":""},"correct":false,"feedback":{"fr":"","en":"The signature date is not one of the disclosures asked for (IAS 23, para. 26).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000078","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DISCLOSURE.AMOUNT","IAS23.DISCLOSURE.CAPITALISATION_RATE"],"dimension":"DOCUMENTATION","format":"FILL_BLANK","context":"GENERIC","tested_point":"NOTE_WORDING","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS23.000010","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000010","section_id":"numeric-disclosure"},"references":["IAS 23 §26"],"exercise":{"prompt":{"fr":"","en":"Complete the note.","es":""},"explanation":{"fr":"","en":"The note gives the amount capitalised then the capitalisation rate used (IAS 23, para. 26). Rule to remember: the amount capitalised and the capitalisation rate used are disclosed (IAS 23, para. 26).","es":""},"common_error":{"fr":"","en":"Confusing the capitalisation rate with a threshold.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"Borrowing costs capitalised during the year amount to €115,500. The capitalisation {{b1}} used is 4.2%.","es":""},"blanks":[{"id":"b1","mode":"CHOICE","choices":[{"id":"a","text":{"fr":"","en":"rate","es":""}},{"id":"b","text":{"fr":"","en":"period","es":""}},{"id":"c","text":{"fr":"","en":"threshold","es":""}}],"answer":"a"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000079","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DISCLOSURE.AMOUNT"],"dimension":"CALCULATION","format":"CALCULATION","context":"GENERIC","tested_point":"DISCLOSURE_TOTAL","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS23.000010","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000010","section_id":"numeric-disclosure"},"references":["IAS 23 §26"],"exercise":{"prompt":{"fr":"","en":"The company Janelle capitalised €84,000 on its plant (specific borrowing) and €31,500 on its warehouse (general borrowings). Calculate the amount to state in the notes for the year.","es":""},"explanation":{"fr":"","en":"84,000 + 31,500 = €115,500. The note totals both assets (IAS 23, para. 26). Rule to remember: the amount disclosed is that of the borrowing costs capitalised in the period (IAS 23, para. 26).","es":""},"common_error":{"fr":"","en":"Stating only one of the two assets.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Capitalised on the plant","es":""},"value":"84000","unit":"EUR"},{"label":{"fr":"","en":"Capitalised on the warehouse","es":""},"value":"31500","unit":"EUR"}],"steps":[{"id":"tot","label":{"fr":"","en":"Amount to disclose","es":""},"answer":115500,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"tot","meaning":{"fr":"","en":"Amount to disclose","es":""},"expression":"a + b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Capitalised on the plant","es":""},"value":84000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Capitalised on the warehouse","es":""},"value":31500,"unit":"EUR"}],"result":115500,"unit":"EUR"}],"rationale":{"fr":"","en":"the amount disclosed is that of the borrowing costs capitalised in the period (IAS 23, para. 26).","es":""},"references":["REF.IAS23.26"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000080","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.DISCLOSURE.AMOUNT","IAS23.DISCLOSURE.CAPITALISATION_RATE"],"dimension":"DOCUMENTATION","format":"SINGLE_CHOICE","context":"GENERIC","tested_point":"DISCLOSURE_REVIEW","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS23.000010","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000010","section_id":"pitfalls"},"references":["IAS 23 §26"],"exercise":{"prompt":{"fr":"","en":"An entity's note says: \"Borrowing costs were capitalised into a plant under construction.\" No amount or rate is given, although the entity used a capitalisation rate on its general borrowings. What is missing?","es":""},"explanation":{"fr":"","en":"The amount capitalised and the rate used are missing; these disclosures show the effect of capitalisation on the asset and profit or loss (IAS 23, para. 26).","es":""},"common_error":{"fr":"","en":"Settling for a qualitative mention.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The detail of the loan repayment schedule","es":""},"correct":false,"feedback":{"fr":"","en":"This is not the disclosure the standard requires on this subject (IAS 23, para. 26).","es":""}},{"id":"B","text":{"fr":"","en":"The amount capitalised in the period and the capitalisation rate used","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Nothing: the qualitative mention is enough","es":""},"correct":false,"feedback":{"fr":"","en":"Both disclosures are quantified: the amount capitalised and the rate used (IAS 23, para. 26).","es":""}},{"id":"D","text":{"fr":"","en":"Only the capitalisation rate","es":""},"correct":false,"feedback":{"fr":"","en":"The amount capitalised is also required: it is missing as well (IAS 23, para. 26).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000081","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.TRANSITION.AIP_2015_2017"],"dimension":"RULE_KNOWLEDGE","format":"SINGLE_CHOICE","context":"GENERIC","tested_point":"AIP_EFFECTIVE_DATE","difficulty":"ADVANCED","estimated_time_s":50,"lesson_id":"LS.IAS23.000011","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000011","section_id":"rule-aip"},"references":["IAS 23 §14","IAS 23 §28A","IAS 23 §29D"],"exercise":{"prompt":{"fr":"","en":"From when does the amendment from the Annual Improvements 2015-2017 on the capitalisation rate apply, and how?","es":""},"explanation":{"fr":"","en":"The amendment is mandatory for annual periods beginning on or after 1 January 2019, with earlier application permitted (IAS 23, para. 29D); it covers borrowing costs incurred from the start of the period of first application, without restatement (IAS 23, para. 28A).","es":""},"common_error":{"fr":"","en":"Applying the amendment retrospectively.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"To annual periods beginning on or after 1 January 2019, prospectively","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"To annual periods beginning on or after 1 January 2019, retrospectively","es":""},"correct":false,"feedback":{"fr":"","en":"The date is right, but the amendment covers borrowing costs incurred from the start of the period of first application, without restatement (IAS 23, para. 28A).","es":""}},{"id":"C","text":{"fr":"","en":"From the publication of the standard in 2007","es":""},"correct":false,"feedback":{"fr":"","en":"2007 is the year of the original revision; the amendment dates from December 2017 (IAS 23, para. 29D).","es":""}},{"id":"D","text":{"fr":"","en":"To annual periods ended before 1 January 2019","es":""},"correct":false,"feedback":{"fr":"","en":"It is the other way round: the amendment targets periods beginning from 2019 onward (IAS 23, para. 29D).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000082","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.TRANSITION.AIP_2015_2017"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"AIP_PROSPECTIVE","difficulty":"ADVANCED","estimated_time_s":45,"lesson_id":"LS.IAS23.000011","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000011","section_id":"rule-aip"},"references":["IAS 23 §14","IAS 23 §28A","IAS 23 §29D"],"exercise":{"prompt":{"fr":"","en":"An entity applying the 2015-2017 amendment for the first time does not restate earlier periods.","es":""},"explanation":{"fr":"","en":"The amendment covers borrowing costs incurred from the start of the period of first application: amounts of earlier periods are not restated (IAS 23, para. 28A). Rule to remember: the 2015-2017 amendment applies without restatement, to costs incurred from that period onward (IAS 23, para. 28A).","es":""},"common_error":{"fr":"","en":"Applying the amendment retrospectively.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000083","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.TRANSITION.ORIGINAL"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"GENERIC","tested_point":"ORIGINAL_TRANSITION","difficulty":"ADVANCED","estimated_time_s":60,"lesson_id":"LS.IAS23.000011","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000011","section_id":"rule-original"},"references":["IAS 23 §27","IAS 23 §28","IAS 23 §29"],"exercise":{"prompt":{"fr":"","en":"An entity prepares its financial statements for a recent year. A colleague proposes applying the original 2007 transitional provisions to decide on capitalising interest. What is the answer?","es":""},"explanation":{"fr":"","en":"The original 2007 provisions do not apply to a current period (IAS 23).","es":""},"common_error":{"fr":"","en":"Applying a 2007 transitional provision to a current period.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"They still apply to all years and all assets, regardless of date","es":""},"correct":false,"feedback":{"fr":"","en":"The original transitional provisions do not govern a current period (IAS 23).","es":""}},{"id":"B","text":{"fr":"","en":"They replace the capitalisation rule of the principle","es":""},"correct":false,"feedback":{"fr":"","en":"A transitional provision does not set aside the capitalisation principle (IAS 23).","es":""}},{"id":"C","text":{"fr":"","en":"They require restating the last five years for all the entity's qualifying assets concerned, whatever their date of entry into service","es":""},"correct":false,"feedback":{"fr":"","en":"No restatement of this kind is provided for a current period (IAS 23).","es":""}},{"id":"D","text":{"fr":"","en":"These provisions concerned the move to the revised 2007 version; they do not cover a current period","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000084","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.TRANSITION.AIP_2015_2017","IAS23.GENERAL.RATE_AFTER_2019"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"GENERIC","tested_point":"AIP_STATEMENTS","difficulty":"EXPERT","estimated_time_s":90,"lesson_id":"LS.IAS23.000011","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000011","section_id":"rule-aip"},"references":["IAS 23 §14","IAS 23 §28A","IAS 23 §29D"],"exercise":{"prompt":{"fr":"","en":"Spot the erroneous statements in a memo on the 2015-2017 amendment.","es":""},"explanation":{"fr":"","en":"The amendment is prospective, from 2019, and brings the specific borrowing still outstanding into general borrowings (IAS 23, para. 14). Rule to remember: the amendment is mandatory for annual periods beginning on or after 1 January 2019 (IAS 23, para. 29D) and covers costs incurred from the period of first application (IAS 23, para. 28A).","es":""},"common_error":{"fr":"","en":"Mixing the pre-2019 and post-2019 wording.","es":""},"format":"ERROR_SPOT","statements":[{"id":"e1","text":{"fr":"","en":"It applies to annual periods beginning on or after 1 January 2019.","es":""},"erroneous":false},{"id":"e2","text":{"fr":"","en":"It applies retrospectively, with restatement of comparatives.","es":""},"erroneous":true,"correction":{"fr":"","en":"It covers borrowing costs incurred from the start of the period of first application: comparatives are not restated (IAS 23, para. 28A).","es":""}},{"id":"e3","text":{"fr":"","en":"It brings into the rate a specific borrowing still outstanding after its asset is complete.","es":""},"erroneous":false},{"id":"e4","text":{"fr":"","en":"It keeps out of the rate any specific borrowing after completion, as before.","es":""},"erroneous":true,"correction":{"fr":"","en":"That is the earlier wording: since the amendment, this borrowing joins general borrowings (IAS 23, para. 14).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000085","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS16"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"IAS16_COST","difficulty":"BEGINNER","estimated_time_s":50,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-ias16"},"references":["IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"The company Tavelle builds an industrial building itself. Directly attributable borrowing costs are capitalised. Where do they end up afterwards?","es":""},"explanation":{"fr":"","en":"Capitalised interest forms part of the cost of the asset and is depreciated with it (IAS 23, para. 8).","es":""},"common_error":{"fr":"","en":"Depreciating the asset without including the capitalised interest.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"In the cost of the asset, then in depreciation, which is based on that cost","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"In the finance costs of the year, outside cost","es":""},"correct":false,"feedback":{"fr":"","en":"Capitalised costs leave the expenses of the period and enter the cost of the asset (IAS 23, para. 8).","es":""}},{"id":"C","text":{"fr":"","en":"In equity, through a reserve","es":""},"correct":false,"feedback":{"fr":"","en":"Capitalisation does not go through equity: it increases the cost of the asset (IAS 23, para. 8).","es":""}},{"id":"D","text":{"fr":"","en":"In a provision for risks","es":""},"correct":false,"feedback":{"fr":"","en":"A provision has no link with capitalising interest (IAS 23, para. 8).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000086","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS16"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"IAS16_DEPRECIATION","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"numeric-ias16"},"references":["IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"The company Rovelle built a plant for €3,000,000 of expenditure, with €150,000 of capitalised borrowing costs. Straight-line depreciation over 20 years, no residual value (case conventions). Calculate the cost of the plant and the annual depreciation.","es":""},"explanation":{"fr":"","en":"3,000,000 + 150,000 = €3,150,000; 3,150,000 ÷ 20 = €157,500 (IAS 23, para. 8). Rule to remember: depreciation is based on the cost of the asset, including capitalised interest (IAS 23, para. 8).","es":""},"common_error":{"fr":"","en":"Depreciating €3,000,000 excluding capitalised interest (€150,000 a year).","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Expenditure","es":""},"value":"3000000","unit":"EUR"},{"label":{"fr":"","en":"Capitalised borrowing costs","es":""},"value":"150000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"20","unit":"YEARS"}],"steps":[{"id":"cost","label":{"fr":"","en":"Cost of the plant","es":""},"answer":3150000,"tolerance":0,"unit":"EUR"},{"id":"dep","label":{"fr":"","en":"Annual depreciation","es":""},"answer":157500,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"cost","meaning":{"fr":"","en":"Cost of the plant","es":""},"expression":"a + b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Expenditure","es":""},"value":3000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Capitalised borrowing costs","es":""},"value":150000,"unit":"EUR"}],"result":3150000,"unit":"EUR"},{"step":"dep","meaning":{"fr":"","en":"Annual depreciation","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the plant","es":""},"value":3150000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Useful life","es":""},"value":20,"unit":"YEARS"}],"result":157500,"unit":"EUR"}],"rationale":{"fr":"","en":"depreciation is based on the cost of the asset, including capitalised interest (IAS 23, para. 8).","es":""},"references":["REF.IAS23.8"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000087","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS2"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"IAS2_QUALIFYING_INVENTORY","difficulty":"BEGINNER","estimated_time_s":60,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-ias2"},"references":["IAS 23 §7"],"exercise":{"prompt":{"fr":"","en":"A distillery makes an inventory of spirits whose preparation necessarily takes a long period (case data). It finances this inventory by borrowing. What does IAS 23 provide?","es":""},"explanation":{"fr":"","en":"An inventory that needs a substantial period can be a qualifying asset (IAS 23, para. 7).","es":""},"common_error":{"fr":"","en":"Excluding all inventory from capitalisation.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Inventories cannot receive borrowing costs, whatever the length of their preparation","es":""},"correct":false,"feedback":{"fr":"","en":"Inventories are among the examples of qualifying assets when they need a substantial period (IAS 23, para. 7).","es":""}},{"id":"B","text":{"fr":"","en":"Borrowing costs are an expense for inventory, even if its preparation necessarily takes a long period","es":""},"correct":false,"feedback":{"fr":"","en":"For a qualifying inventory, directly attributable costs are capitalised (IAS 23, para. 7).","es":""}},{"id":"C","text":{"fr":"","en":"The inventory is excluded because it is intended for sale","es":""},"correct":false,"feedback":{"fr":"","en":"The definition covers an asset ready for its intended use or sale: sale does not exclude (IAS 23).","es":""}},{"id":"D","text":{"fr":"","en":"The inventory can be a qualifying asset: its directly attributable borrowing costs are capitalised","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000088","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS2"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"RETAIL","tested_point":"IAS2_NOT_ALL","difficulty":"INTERMEDIATE","estimated_time_s":45,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-ias2"},"references":["IAS 23 §7"],"exercise":{"prompt":{"fr":"","en":"An entity that borrows may capitalise interest into the cost of all its inventories, including those produced in a few hours.","es":""},"explanation":{"fr":"","en":"Rapidly produced inventories are not qualifying assets: they receive no borrowing costs (IAS 23, para. 7). Rule to remember: qualifying inventories, which need a substantial period, receive borrowing costs (IAS 23, para. 7).","es":""},"common_error":{"fr":"","en":"Capitalising interest into the cost of all inventories.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000089","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS36_NRV"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"IMPAIRMENT_AFTER_CAPITALISATION","difficulty":"ADVANCED","estimated_time_s":75,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-ias36"},"references":["IAS 23 §16"],"exercise":{"prompt":{"fr":"","en":"The cost of a plant, including capitalised interest, is €5,250,000; its recoverable amount is estimated at €5,000,000. What is the consequence of having capitalised interest for the value test?","es":""},"explanation":{"fr":"","en":"If the carrying amount exceeds the recoverable amount, the asset is written down in accordance with other standards (IAS 23, para. 16).","es":""},"common_error":{"fr":"","en":"Not testing for impairment an asset whose cost includes capitalised interest.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Capitalised interest is excluded from the comparison, as it remains a finance charge and not investment expenditure of the period","es":""},"correct":false,"feedback":{"fr":"","en":"Capitalisation is part of the carrying amount: it enters the comparison (IAS 23, para. 16).","es":""}},{"id":"B","text":{"fr":"","en":"Capitalisation shields the asset from write-down as long as the interest stays capitalised","es":""},"correct":false,"feedback":{"fr":"","en":"An asset whose cost includes interest remains subject to the value test (IAS 23, para. 16).","es":""}},{"id":"C","text":{"fr":"","en":"The carrying amount, including interest, is compared with the recoverable amount: the excess of €250,000 is written down","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"Capitalised interest is reversed to profit or loss with no other entry on the asset","es":""},"correct":false,"feedback":{"fr":"","en":"The standard refers to other standards for the write-down, not to a reversal of interest (IAS 23, para. 16).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000090","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS36_NRV"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"LOWER_OF_CARRYING_RECOVERABLE","difficulty":"EXPERT","estimated_time_s":100,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-ias36"},"references":["IAS 23 §16"],"exercise":{"prompt":{"fr":"","en":"The plant of the company Brenlane has a carrying amount of €5,250,000, of which €250,000 is capitalised borrowing costs. Its recoverable amount is €5,000,000 (case data, IAS 36). Calculate the write-down and the carrying amount after the test.","es":""},"explanation":{"fr":"","en":"5,250,000 − 5,000,000 = €250,000; carrying amount after the test = minimum (5,250,000; 5,000,000) = €5,000,000 (IAS 23, para. 16). Case convention: the recoverable amount is a case datum; calculating it falls under IAS 36. Rule to remember: the carrying amount, including capitalised interest, is brought down to the recoverable amount if it exceeds it (IAS 23, para. 16).","es":""},"common_error":{"fr":"","en":"Leaving the asset at €5,250,000 because the interest was capitalised.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Carrying amount","es":""},"value":"5250000","unit":"EUR"},{"label":{"fr":"","en":"Recoverable amount","es":""},"value":"5000000","unit":"EUR"}],"steps":[{"id":"loss","label":{"fr":"","en":"Write-down","es":""},"answer":250000,"tolerance":0,"unit":"EUR"},{"id":"after","label":{"fr":"","en":"Carrying amount after the test","es":""},"answer":5000000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"loss","meaning":{"fr":"","en":"Write-down","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount","es":""},"value":5250000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Recoverable amount","es":""},"value":5000000,"unit":"EUR"}],"result":250000,"unit":"EUR"}],"rationale":{"fr":"","en":"the carrying amount, including capitalised interest, is brought down to the recoverable amount if it exceeds it (IAS 23, para. 16).","es":""},"references":["REF.IAS23.16"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000091","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS38"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"TECHNOLOGY","tested_point":"INTANGIBLE_QUALIFYING","difficulty":"ADVANCED","estimated_time_s":60,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-ias38"},"references":["IAS 23 §7"],"exercise":{"prompt":{"fr":"","en":"The company Cyrane develops software whose development necessarily takes a long period (case data); the intangible asset is recognised under IAS 38. A loan finances this development. What does IAS 23 provide?","es":""},"explanation":{"fr":"","en":"An intangible asset under development can be a qualifying asset depending on the facts (IAS 23, para. 7).","es":""},"common_error":{"fr":"","en":"Capitalising interest on a project that gives rise to no recognised asset.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"An intangible asset cannot be a qualifying asset","es":""},"correct":false,"feedback":{"fr":"","en":"Intangible assets are among the examples of qualifying assets (IAS 23, para. 7).","es":""}},{"id":"B","text":{"fr":"","en":"The intangible asset can be a qualifying asset: its directly attributable borrowing costs are capitalised","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Interest is capitalised from the loan signature, before development","es":""},"correct":false,"feedback":{"fr":"","en":"Capitalisation begins when expenditure, borrowing costs and preparation come together (IAS 23).","es":""}},{"id":"D","text":{"fr":"","en":"Interest is capitalised on a project, including one that gave rise to no recognised asset","es":""},"correct":false,"feedback":{"fr":"","en":"With no recognised asset (IAS 38), there is no asset into which to capitalise borrowing costs (IAS 23, para. 7).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000092","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS20_GRANTS"],"dimension":"CALCULATION","format":"CALCULATION","context":"ENERGY","tested_point":"ELIGIBLE_NET_OF_GRANT","difficulty":"ADVANCED","estimated_time_s":100,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-grants"},"references":["IAS 23 §18"],"exercise":{"prompt":{"fr":"","en":"The company Sondane builds a plant: cash paid €2,500,000, assets transferred €300,000, interest-bearing liabilities assumed €1,200,000. It receives a grant of €600,000 in respect of the asset (case data). Calculate eligible expenditure gross and then net of the grant.","es":""},"explanation":{"fr":"","en":"2,500,000 + 300,000 + 1,200,000 = €4,000,000; 4,000,000 − 600,000 = €3,400,000 (IAS 23, para. 18). A capitalisation based on the gross €4,000,000 would overstate the expenditure funded by the grant. Rule to remember: grants received in respect of the asset are deducted from eligible expenditure (IAS 23, para. 18).","es":""},"common_error":{"fr":"","en":"Calculating capitalisation on gross expenditure and forgetting the grant.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cash paid","es":""},"value":"2500000","unit":"EUR"},{"label":{"fr":"","en":"Assets transferred","es":""},"value":"300000","unit":"EUR"},{"label":{"fr":"","en":"Interest-bearing liabilities assumed","es":""},"value":"1200000","unit":"EUR"},{"label":{"fr":"","en":"Grant received","es":""},"value":"600000","unit":"EUR"}],"steps":[{"id":"gross","label":{"fr":"","en":"Gross eligible expenditure","es":""},"answer":4000000,"tolerance":0,"unit":"EUR"},{"id":"net","label":{"fr":"","en":"Net eligible expenditure","es":""},"answer":3400000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"gross","meaning":{"fr":"","en":"Gross eligible expenditure","es":""},"expression":"a + b + c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cash paid","es":""},"value":2500000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Assets transferred","es":""},"value":300000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Interest-bearing liabilities assumed","es":""},"value":1200000,"unit":"EUR"}],"result":4000000,"unit":"EUR"},{"step":"net","meaning":{"fr":"","en":"Net eligible expenditure","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Gross eligible expenditure","es":""},"value":4000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Grant received","es":""},"value":600000,"unit":"EUR"}],"result":3400000,"unit":"EUR"}],"rationale":{"fr":"","en":"grants received in respect of the asset are deducted from eligible expenditure (IAS 23, para. 18).","es":""},"references":["REF.IAS23.18"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000093","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS20_GRANTS"],"dimension":"CALCULATION","format":"CALCULATION","context":"ENERGY","tested_point":"COST_TWO_PRESENTATIONS","difficulty":"EXPERT","estimated_time_s":140,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"numeric-grants"},"references":["IAS 23 §18"],"exercise":{"prompt":{"fr":"","en":"For the company Sondane (gross eligible expenditure €4,000,000, grant €600,000, capitalised borrowing costs €200,000), calculate the cost of the asset with interest under the deduction-from-cost presentation, then under the deferred income presentation, as well as the deferred income on the balance sheet.","es":""},"explanation":{"fr":"","en":"Deduction: 4,000,000 − 600,000 + 200,000 = €3,600,000. Deferred income: 4,000,000 + 200,000 = €4,200,000 with €600,000 as a liability (IAS 23, para. 18). Case convention: the capitalised borrowing costs of €200,000 are a case datum. Rule to remember: the grant presentation changes the cost of the asset and the balance sheet; it is a policy choice falling under IAS 20 (IAS 23, para. 18).","es":""},"common_error":{"fr":"","en":"Presenting the method used as imposed by IAS 23.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Gross eligible expenditure","es":""},"value":"4000000","unit":"EUR"},{"label":{"fr":"","en":"Grant","es":""},"value":"600000","unit":"EUR"},{"label":{"fr":"","en":"Capitalised borrowing costs","es":""},"value":"200000","unit":"EUR"}],"steps":[{"id":"ded","label":{"fr":"","en":"Cost with the grant deducted","es":""},"answer":3600000,"tolerance":0,"unit":"EUR"},{"id":"gross","label":{"fr":"","en":"Cost with deferred income","es":""},"answer":4200000,"tolerance":0,"unit":"EUR"},{"id":"def","label":{"fr":"","en":"Deferred income on the balance sheet","es":""},"answer":600000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"ded","meaning":{"fr":"","en":"Cost with the grant deducted","es":""},"expression":"a - b + c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Gross eligible expenditure","es":""},"value":4000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Grant","es":""},"value":600000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Capitalised borrowing costs","es":""},"value":200000,"unit":"EUR"}],"result":3600000,"unit":"EUR"},{"step":"gross","meaning":{"fr":"","en":"Cost with deferred income","es":""},"expression":"a + b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Gross eligible expenditure","es":""},"value":4000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Capitalised borrowing costs","es":""},"value":200000,"unit":"EUR"}],"result":4200000,"unit":"EUR"}],"rationale":{"fr":"","en":"the grant presentation changes the cost of the asset and the balance sheet; it is a policy choice falling under IAS 20 (IAS 23, para. 18).","es":""},"references":["REF.IAS23.18"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000094","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS20_GRANTS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"ENERGY","tested_point":"DEFERRED_INCOME_RELEASE","difficulty":"EXPERT","estimated_time_s":150,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"entry-grants"},"references":["IAS 23 §18"],"exercise":{"prompt":{"fr":"","en":"Under the deferred income presentation, the company Sondane recognises, for one year, depreciation on the gross cost of €4,200,000 (20 years, no residual value) and the release of the €600,000 grant over 20 years. Record the entry.","es":""},"explanation":{"fr":"","en":"Depreciation: 4,200,000 ÷ 20 = 210,000; release: 600,000 ÷ 20 = 30,000. Net effect on profit or loss: 210,000 − 30,000 = €180,000 (IAS 23, para. 18). Case convention: illustrative entry; straight-line release over the useful life (case convention). Rule to remember: under deferred income, depreciation is based on the gross cost and the grant is released to profit or loss over the useful life (IAS 23, para. 18).","es":""},"common_error":{"fr":"","en":"Calculating depreciation on the net cost although deferred income is used.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"dep","text":{"fr":"","en":"Depreciation expense","es":""}},{"id":"acc","text":{"fr":"","en":"Accumulated depreciation","es":""}},{"id":"def","text":{"fr":"","en":"Deferred income","es":""}},{"id":"inc","text":{"fr":"","en":"Grant income","es":""}}],"lines":[{"id":"l1","account":"dep","side":"DEBIT","amount":210000,"given":["account","side"]},{"id":"l2","account":"def","side":"DEBIT","amount":30000},{"id":"l3","account":"acc","side":"CREDIT","amount":210000},{"id":"l4","account":"inc","side":"CREDIT","amount":30000,"given":["account","side"]}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000095","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS20_GRANTS","IAS23.INTERACTIONS.IAS16"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"ENERGY","tested_point":"GRANT_PRESENTATION_COMPARISON","difficulty":"EXPERT","estimated_time_s":180,"lesson_id":"LS.IAS23.000012","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"judgment"},"references":["IAS 23 §18","IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"Comparing the two grant presentations of the company Sondane.","es":""},"explanation":{"fr":"","en":"Professional judgement: the presentation choice, applied consistently and documented, changes the asset, depreciation and deferred income, but not here the net effect; the disclosure should be consistent with the choice made (IAS 23, para. 18). Case convention: the amounts, the 20-year life and the straight-line release are case conventions, not IAS 23 rules. Rule to remember: the asset grant reduces eligible expenditure, and its presentation is a choice falling under IAS 20 (IAS 23, para. 18).","es":""},"common_error":{"fr":"","en":"Presenting one of the two presentations as imposed by the standard.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Teaching assumption: the fictitious company Sondane has a plant whose gross eligible expenditure is €4,000,000, with a grant of €600,000 and €200,000 of capitalised borrowing costs. It hesitates between deducting the grant from the cost of the asset (presentation A) and presenting it as deferred income (presentation B). Straight-line depreciation over 20 years, no residual value; release of deferred income over 20 years (case conventions).","es":""},"parts":[{"prompt":{"fr":"","en":"Calculate the net annual effect on profit or loss of each presentation.","es":""},"explanation":{"fr":"","en":"A: 3,600,000 ÷ 20 = €180,000. B: 4,200,000 ÷ 20 − 30,000 = 210,000 − 30,000 = €180,000 (IAS 23, para. 18). Rule to remember: the two grant presentations differ in the balance sheet and gross depreciation, not (here) in the net effect (IAS 23, para. 18).","es":""},"common_error":{"fr":"","en":"Thinking the two presentations give different net charges: they differ in the balance sheet and gross depreciation, not here in the net effect.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost presentation A","es":""},"value":"3600000","unit":"EUR"},{"label":{"fr":"","en":"Cost presentation B","es":""},"value":"4200000","unit":"EUR"},{"label":{"fr":"","en":"Annual release (B)","es":""},"value":"30000","unit":"EUR"}],"steps":[{"id":"a","label":{"fr":"","en":"Net annual effect, presentation A","es":""},"answer":180000,"tolerance":0,"unit":"EUR"},{"id":"b","label":{"fr":"","en":"Net annual effect, presentation B","es":""},"answer":180000,"tolerance":0,"unit":"EUR"}],"id":"p1","dimension":"CALCULATION"},{"prompt":{"fr":"","en":"Which statement is correct for this case?","es":""},"explanation":{"fr":"","en":"The two presentations differ in the balance sheet, not in the net annual effect in this case (IAS 23, para. 18).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"IAS 23 requires presentation A","es":""},"correct":false,"feedback":{"fr":"","en":"IAS 23 reduces eligible expenditure; presenting the grant falls under IAS 20, which allows two presentations (IAS 23, para. 18).","es":""}},{"id":"B","text":{"fr":"","en":"Presentation B increases net profit by €30,000 a year relative to A","es":""},"correct":false,"feedback":{"fr":"","en":"The release of €30,000 is offset by a higher gross depreciation: the net effect is identical (IAS 23, para. 18).","es":""}},{"id":"C","text":{"fr":"","en":"Total assets differ by €600,000 between A and B, while the net annual effect on profit or loss is the same","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"The grant has no effect on the cost of the asset in A","es":""},"correct":false,"feedback":{"fr":"","en":"In A, the grant is deducted: the cost falls from €4,200,000 to €3,600,000 (IAS 23, para. 18).","es":""}}],"id":"p2","dimension":"ANALYSIS"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000096","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.BORROWING_COSTS.COMPONENTS","IAS23.BORROWING_COSTS.FX_DIFFERENCES"],"dimension":"CALCULATION","format":"MINI_CASE","context":"MANUFACTURING","tested_point":"COMPONENTS_MINI","difficulty":"ADVANCED","estimated_time_s":330,"lesson_id":"LS.IAS23.000004","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"rule-components"},"references":["IAS 23 §6","IAS 23 §3"],"exercise":{"prompt":{"fr":"","en":"Determine Brevalis's borrowing costs for year N.","es":""},"explanation":{"fr":"","en":"Borrowing costs for N: 187,800, i.e. interest at the effective rate (107,800), interest on the lease liability (12,000), interest in dollars (50,000) and the exchange part regarded as interest (18,000) (IAS 23, para. 6). Outside borrowing costs: 12,000 of exchange loss and the dividends (IAS 23, para. 3). Case convention: the 18,000 part is the entity’s documented judgement; the standard sets no numerical method.","es":""},"common_error":{"fr":"","en":"Treating every financing-related charge as a borrowing cost, including the return to shareholders and all exchange differences.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Brevalis, a maker of insulation materials (a fictitious entity), lists its financing charges for year N (case data). (1) A bank loan of 2,000,000, at a nominal rate of 5%, received on 1 January N for 1,960,000 after 40,000 of arrangement fees; its effective interest rate is 5.5%. (2) The lease liability for a leased crane, accounted for under IFRS 16: 300,000 at 1 January N, rate 4%. (3) A dollar borrowing: 50,000 of interest and a 30,000 exchange loss for the year; according to its documented analysis, Brevalis regards 18,000 of that loss as an adjustment to interest costs (case data, the entity's judgement). (4) 80,000 of dividends paid to ordinary shareholders. No repayment occurs in N.","es":""},"parts":[{"prompt":{"fr":"","en":"Calculate the interest on the bank loan, the total borrowing costs for N and the exchange loss that is not part of them.","es":""},"explanation":{"fr":"","en":"| Component | Calculation | Amount |\n| --- | --- | --- |\n| Interest at the effective rate (IAS 23, para. 6(a)) | 1,960,000 × 5.5% | 107,800 |\n| Interest on the lease liability (IAS 23, para. 6(d)) | 300,000 × 4% | 12,000 |\n| Interest on the dollar borrowing | data | 50,000 |\n| Exchange part regarded as interest (IAS 23, para. 6(e)) | data | 18,000 |\n| **Total borrowing costs** | | **187,800** |\n\nInterest is calculated at the effective rate on the amount received, not at the nominal rate (100,000): the arrangement fees are part of the cost of the loan. The remaining exchange loss, 30,000 − 18,000 = 12,000, is not a borrowing cost.","es":""},"common_error":{"fr":"","en":"Using interest at the nominal rate (2,000,000 × 5% = 100,000) or adding the whole exchange loss of 30,000 to borrowing costs.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Amount received net of fees / effective interest rate","es":""},"value":"1960000 / 5.5","unit":"TEXT"},{"label":{"fr":"","en":"Lease liability at 1 January N / rate","es":""},"value":"300000 / 4","unit":"TEXT"},{"label":{"fr":"","en":"Interest on the dollar borrowing / exchange loss / part regarded as interest","es":""},"value":"50000 / 30000 / 18000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Interest on the bank loan at the effective rate","es":""},"answer":107800,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Total borrowing costs for N","es":""},"answer":187800,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Exchange loss outside borrowing costs","es":""},"answer":12000,"tolerance":0,"unit":"EUR"}],"id":"P1","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Interest on the bank loan at the effective rate","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"1,960,000 after","es":""},"value":1960000},{"symbol":"b","meaning":{"fr":"","en":"its effective interest rate is 5.5%","es":""},"value":5.5,"unit":"PERCENT"}],"result":107800,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Exchange loss outside borrowing costs","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"of interest and a 30,000","es":""},"value":30000},{"symbol":"b","meaning":{"fr":"","en":"according to its documented analysis, Brevalis regards 18,000","es":""},"value":18000}],"result":12000,"unit":"EUR"}],"references":["REF.IAS23.6"]}},{"prompt":{"fr":"","en":"Why are the 80,000 of dividends not included in the total?","es":""},"explanation":{"fr":"","en":"IAS 23 does not deal with the actual or imputed cost of equity, including preferred capital not classified as a liability (IAS 23, para. 3): dividends on ordinary shares stay outside borrowing costs.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Because the standard does not deal with the actual or imputed cost of equity","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Because dividends are borrowing costs only when they are paid in cash","es":""},"correct":false,"feedback":{"fr":"","en":"The method of payment makes no difference: the return on ordinary shares is a cost of equity, outside the scope of the standard (IAS 23, para. 3).","es":""}},{"id":"C","text":{"fr":"","en":"Because only specific borrowings give rise to borrowing costs","es":""},"correct":false,"feedback":{"fr":"","en":"General borrowings also give rise to borrowing costs; the reason lies elsewhere: dividends on ordinary shares are a return on equity (IAS 23, para. 3).","es":""}}],"id":"P2","dimension":"RULE_KNOWLEDGE"},{"prompt":{"fr":"","en":"The 12,000 of interest on the crane lease liability is part of Brevalis's borrowing costs.","es":""},"explanation":{"fr":"","en":"True. Borrowing costs may include interest on lease liabilities recognised under IFRS 16 (IAS 23, para. 6(d)). Whether they are then capitalised in an asset or expensed depends on the asset financed, a question not asked here.","es":""},"common_error":{"fr":"","en":"Excluding interest on lease liabilities from borrowing costs on the ground that it is not a bank loan.","es":""},"format":"TRUE_FALSE","answer":true,"id":"P3","dimension":"APPLICATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS23.000097","source":"V2","standard_id":"IAS23","concept_ids":["IAS23.TRANSITION.ORIGINAL","IAS23.TRANSITION.AIP_2015_2017"],"dimension":"APPLICATION","format":"MINI_CASE","context":"ENERGY","tested_point":"TRANSITION_MINI","difficulty":"ADVANCED","estimated_time_s":300,"lesson_id":"LS.IAS23.000011","review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000011","section_id":"rule-aip"},"references":["IAS 23 §27","IAS 23 §28","IAS 23 §28A","IAS 23 §29D","IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"Apply to Montarel the transition and effective date provisions of IAS 23.","es":""},"explanation":{"fr":"","en":"Approach: (1) original transition, assets for which capitalisation commences from the designated date, 1 January 2008 (IAS 23, paras. 27 and 28); (2) 2015-2017 amendment effective for annual periods beginning on or after 1 January 2019 (IAS 23, para. 29D); (3) applied to costs incurred from 1 January 2019, without restating 2018 (IAS 23, para. 28A): loan B joins general borrowings, rate 5.4% (IAS 23, para. 14).","es":""},"common_error":{"fr":"","en":"Confusing the dates: that of the revised standard (2009), the one chosen by the entity (2008) and that of the 2015-2017 amendment (2019).","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Montarel, an energy producer (a fictitious entity), has a 31 December year end. Case data: (1) when it first applied revised IAS 23, which was a change in accounting policy, Montarel designated 1 January 2008 as its application date; (2) Montarel first applies the Annual Improvements 2015-2017 amendment (para. 14) in 2019; (3) in 2019, it builds a new wind farm, a qualifying asset financed by its general borrowings; outstanding throughout the year are loan A of 4,000,000 at 5% and loan B of 1,000,000 at 7%, taken out specifically for a power plant completed and brought into use at the end of 2018; there are no other borrowings.","es":""},"parts":[{"prompt":{"fr":"","en":"On first applying revised IAS 23, to which qualifying assets did Montarel apply the standard?","es":""},"explanation":{"fr":"","en":"When applying the standard is a change in accounting policy, it covers qualifying assets for which capitalisation commences on or after the effective date (IAS 23, para. 27); the entity may designate an earlier date and apply the standard to all assets for which capitalisation commences from that date (IAS 23, para. 28). Here: 1 January 2008 (case data).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"To all qualifying assets for which capitalisation commenced on or after 1 January 2008","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"To all its qualifying assets, including those in progress for several years","es":""},"correct":false,"feedback":{"fr":"","en":"The original transition covers only the assets whose commencement date for capitalisation is on or after the date used (IAS 23, paras. 27 and 28); older assets are not restated.","es":""}},{"id":"C","text":{"fr":"","en":"Only to assets for which capitalisation commenced on or after 1 January 2009, the effective date","es":""},"correct":false,"feedback":{"fr":"","en":"That is the basic rule (IAS 23, para. 27), but the entity may designate an earlier date; Montarel chose 1 January 2008 (IAS 23, para. 28).","es":""}}],"id":"P1","dimension":"RULE_KNOWLEDGE"},{"prompt":{"fr":"","en":"Calculate Montarel's 2019 capitalisation rate on general borrowings.","es":""},"explanation":{"fr":"","en":"Since the 2015-2017 amendment, a specific borrowing still outstanding after the asset it financed is complete joins general borrowings (IAS 23, para. 14); it applies to borrowing costs incurred from the beginning of the period of first application, here 2019 (IAS 23, para. 28A). Costs: 4,000,000 × 5% + 1,000,000 × 7% = 200,000 + 70,000 = 270,000; rate = 270,000 / 5,000,000 = 5.4%.","es":""},"common_error":{"fr":"","en":"Excluding loan B because it was specific (5% rate), even though the asset it financed is complete.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Loan A / rate","es":""},"value":"4000000 / 5","unit":"TEXT"},{"label":{"fr":"","en":"Loan B (plant completed at the end of 2018) / rate","es":""},"value":"1000000 / 7","unit":"TEXT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Borrowing costs for the year of the borrowings included","es":""},"answer":270000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"2019 capitalisation rate","es":""},"answer":5.4,"tolerance":0,"unit":"PERCENT"}],"id":"P2","dimension":"CALCULATION"},{"prompt":{"fr":"","en":"Montarel must recalculate the borrowing costs capitalised in 2018 under the new rule.","es":""},"explanation":{"fr":"","en":"False. The amendment applies to borrowing costs incurred on or after the beginning of the period in which the entity first applies it (IAS 23, para. 28A): the 2018 amounts are not restated.","es":""},"common_error":{"fr":"","en":"Restating prior years as for a retrospective change in accounting policy.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P3","dimension":"APPLICATION"},{"prompt":{"fr":"","en":"From when was the 2015-2017 amendment mandatory?","es":""},"explanation":{"fr":"","en":"The 2015-2017 amendment (para. 14 amended, para. 28A added) applies to annual periods beginning on or after 1 January 2019; earlier application is permitted, with disclosure of that fact (IAS 23, para. 29D). Montarel, with a 31 December year end, therefore applies it in 2019.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"For annual periods beginning on or after 1 January 2019, earlier application permitted with disclosure","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"For annual periods beginning on or after 1 January 2009","es":""},"correct":false,"feedback":{"fr":"","en":"That is the effective date of revised IAS 23 itself (IAS 23, para. 29), not that of the 2015-2017 amendment (IAS 23, para. 29D).","es":""}},{"id":"C","text":{"fr":"","en":"From its issue in December 2017, with no earlier application possible","es":""},"correct":false,"feedback":{"fr":"","en":"The issue date is not the effective date: annual periods beginning on or after 1 January 2019, and earlier application is permitted (IAS 23, para. 29D).","es":""}}],"id":"P4","dimension":"RULE_KNOWLEDGE"}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000001","standard_id":"IAS23","concept_ids":["IAS23.CORE.OBJECTIVE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000001","tested_point":"QST.IAS23.000001","difficulty":"BEGINNER","source":"V1","format":"TRUE_FALSE","estimated_time_s":40,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"understand"},"references":["IAS 23 §1"],"exercise":{"prompt":{"fr":"","en":"Borrowing costs that relate directly to the construction of a qualifying asset are added to the cost of that asset.","es":""},"explanation":{"fr":"","en":"The standard's principle is to include in the cost of the qualifying asset the borrowing costs directly attributable to it; other borrowing costs are expensed (IAS 23, para. 1). Approach: link the borrowing cost to the asset under construction. Trap: believing that financing a construction project does not affect the cost of the asset built. Rule to remember: Borrowing costs directly attributable to a qualifying asset form part of its cost.","es":""},"common_error":{"fr":"","en":"Expensing the interest on a loan taken out to build a qualifying asset.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000002","standard_id":"IAS23","concept_ids":["IAS23.CORE.OBJECTIVE"],"dimension":"APPLICATION","context":"V1_QST.IAS23.000002","tested_point":"QST.IAS23.000002","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":140,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"understand"},"references":["IAS 23 §1"],"exercise":{"prompt":{"fr":"","en":"Vauban borrowed 5,000,000 to finance the construction of a storage warehouse, which is a qualifying asset. It also uses an overdraft for its day-to-day cash needs, unrelated to the project. For the year, it incurred 300,000 of interest on the construction loan and 20,000 of interest on the overdraft. Which treatment is consistent with the standard's principle?","es":""},"explanation":{"fr":"","en":"The construction loan directly finances a qualifying asset: its 300,000 of interest is included in the cost of the warehouse; the 20,000 on the overdraft, unrelated to the project (case data), is an expense (IAS 23, para. 1). Approach: look at each borrowing and its link to the asset. Trap: treating all the interest of the year in the same way. Rule to remember: Each borrowing is assessed for its link with the qualifying asset: linked interest is included, the rest is expensed.","es":""},"common_error":{"fr":"","en":"Capitalising all the interest of the year as soon as a project is under way.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Include the whole 320,000 in the cost of the warehouse, since all the interest of the year is borne by the same company.","es":""},"correct":false,"feedback":{"fr":"","en":"That the interest is borne by the same company does not make it attributable to the warehouse: the overdraft is unrelated to the project, so its interest is not capitalisable (IAS 23, para. 1). Only the 300,000 on the construction loan is. Rule to remember: Each borrowing is assessed for its link with the qualifying asset: linked interest is included, the rest is expensed.","es":""}},{"id":"B","text":{"fr":"","en":"Include the 300,000 on the construction loan in the cost of the warehouse and expense the 20,000 on the overdraft.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Expense the whole 320,000 in the year, because interest is by nature a finance expense.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer overlooks the point of the principle: borrowing costs directly attributable to the construction of a qualifying asset are included in its cost, which is the case for the 300,000 on the construction loan (IAS 23, para. 1). Only the 20,000 on the overdraft is an expense. Rule to remember: Each borrowing is assessed for its link with the qualifying asset: linked interest is included, the rest is expensed.","es":""}},{"id":"D","text":{"fr":"","en":"Split the 320,000 half into the cost of the warehouse and half into expenses, as a precaution.","es":""},"correct":false,"feedback":{"fr":"","en":"A flat split out of caution is not provided for: the test is the direct link with the asset, assessed borrowing by borrowing (IAS 23, para. 1). Here, 300,000 is tied to the warehouse and 20,000 is not. Rule to remember: Each borrowing is assessed for its link with the qualifying asset: linked interest is included, the rest is expensed.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000003","standard_id":"IAS23","concept_ids":["IAS23.CORE.CAPITALISE_OR_EXPENSE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000003","tested_point":"QST.IAS23.000003","difficulty":"BEGINNER","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"rule-principle"},"references":["IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"An entity incurs borrowing costs that are not directly attributable to a qualifying asset. How does it account for them?","es":""},"explanation":{"fr":"","en":"Borrowing costs directly attributable to a qualifying asset are included in its cost; the others are expensed in the period (IAS 23, para. 8). Approach: note the absence of a direct link with a qualifying asset. Trap: trying to attach interest to an asset to avoid the expense. Rule to remember: Borrowing costs not attributable to a qualifying asset are expenses of the period.","es":""},"common_error":{"fr":"","en":"Carrying forward as an asset interest that has no link with a qualifying asset.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"In the cost of the first qualifying asset the entity will acquire, for simplicity.","es":""},"correct":false,"feedback":{"fr":"","en":"A borrowing cost is included only in the asset to which it is directly attributable; attaching unrelated costs to another asset is not provided for (IAS 23, para. 8). They therefore remain expenses of the period. Rule to remember: Borrowing costs not attributable to a qualifying asset are expenses of the period.","es":""}},{"id":"B","text":{"fr":"","en":"Directly in equity, as a distribution to the providers of funds.","es":""},"correct":false,"feedback":{"fr":"","en":"Borrowing costs are not taken to equity: the standard places them either in the cost of the qualifying asset or in expenses of the period (IAS 23, para. 8). Costs that are not attributable fall into the second category. Rule to remember: Borrowing costs not attributable to a qualifying asset are expenses of the period.","es":""}},{"id":"C","text":{"fr":"","en":"As an expense of the period in which they are incurred.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"As prepaid expenses, to spread them over the life of the entity's assets.","es":""},"correct":false,"feedback":{"fr":"","en":"No deferral as an asset is provided for non-attributable borrowing costs: they are expensed in the period in which they are incurred (IAS 23, para. 8). Spreading them would amount to capitalising them without a link to an asset. Rule to remember: Borrowing costs not attributable to a qualifying asset are expenses of the period.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000004","standard_id":"IAS23","concept_ids":["IAS23.CORE.CAPITALISE_OR_EXPENSE"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000004","tested_point":"QST.IAS23.000004","difficulty":"INTERMEDIATE","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"rule-principle"},"references":["IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"Tamaris incurred {borrowing_costs_incurred} of borrowing costs in the year. Part of it, {capitalised_amount}, is directly attributable to a plant under construction and is included in its cost. Calculate the amount of borrowing costs to be expensed.","es":""},"explanation":{"fr":"","en":"Borrowing costs not capitalised are expensed in the period (IAS 23, para. 8). Approach: costs incurred − costs capitalised = 180,000 − 126,000 = 54,000. Trap: expensing the total incurred, 180,000, forgetting the part capitalised. Rule to remember: Borrowing costs expensed are the costs incurred less those included in the cost of the asset.","es":""},"common_error":{"fr":"","en":"Expensing the total costs incurred without deducting the part capitalised.","es":""},"format":"CALCULATION","placeholders":[{"id":"borrowing_costs_incurred","value":"180000","unit":"EUR"},{"id":"capitalised_amount","value":"126000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"Borrowing costs incurred","es":""},"value":"180000","unit":"EUR"},{"label":{"fr":"","en":"Amount included in the plant","es":""},"value":"126000","unit":"EUR"}],"steps":[{"id":"EXPENSED_COSTS","label":{"fr":"","en":"Borrowing costs expensed","es":""},"answer":54000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"EXPENSED_COSTS","meaning":{"fr":"","en":"Borrowing costs expensed","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Borrowing costs incurred","es":""},"value":180000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Amount included in the plant","es":""},"value":126000,"unit":"EUR"}],"result":54000,"unit":"EUR"}],"rationale":{"fr":"","en":"Borrowing costs expensed are the costs incurred less those included in the cost of the asset.","es":""},"references":["REF.IAS23.8"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000006","standard_id":"IAS23","concept_ids":["IAS23.CORE.RECOGNITION_CONDITIONS","IAS23.DEFINITIONS.QUALIFYING_ASSET"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000006","tested_point":"QST.IAS23.000006","difficulty":"INTERMEDIATE","source":"V1","format":"MULTIPLE_CHOICE","estimated_time_s":100,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"rule-conditions"},"references":["IAS 23 §9","IAS 23 §5"],"exercise":{"prompt":{"fr":"","en":"Which conditions must be met to include borrowing costs in the cost of a qualifying asset? Several answers are correct.","es":""},"explanation":{"fr":"","en":"The conditions for inclusion mentioned in paragraph 9 are probable future economic benefits and reliable measurement of the cost (IAS 23, para. 9). Approach: check the elements mentioned against the facts of the case. Trap: adding quantified or formal conditions that the text does not mention. Rule to remember: Inclusion requires probable future economic benefits and a reliably measurable cost.","es":""},"common_error":{"fr":"","en":"Imposing a duration threshold or an approval formality as a condition for inclusion.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The asset must be financed by borrowings raised on a regulated market.","es":""},"correct":false,"feedback":{"fr":"","en":"No condition on the source or market of the borrowing is mentioned: the conditions for inclusion concern future economic benefits and reliability of measurement (IAS 23, para. 9). An ordinary bank loan can therefore qualify. Rule to remember: Inclusion requires probable future economic benefits and a reliably measurable cost.","es":""}},{"id":"B","text":{"fr":"","en":"It is probable that these borrowing costs will result in future economic benefits for the entity.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The construction must last at least twelve months.","es":""},"correct":false,"feedback":{"fr":"","en":"No quantified minimum duration is a condition for inclusion: the standard speaks of a substantial period without quantifying it, and this is a judgement based on the facts (IAS 23, para. 5). The conditions mentioned here are of a different nature (IAS 23, para. 9). Rule to remember: Inclusion requires probable future economic benefits and a reliably measurable cost.","es":""}},{"id":"D","text":{"fr":"","en":"The borrowing costs must have been approved by the general meeting of shareholders.","es":""},"correct":false,"feedback":{"fr":"","en":"Approval by the general meeting is not a condition for inclusion: the questions are whether the cost will result in future economic benefits and whether it can be measured reliably (IAS 23, para. 9). A governance formality does not change the accounting treatment. Rule to remember: Inclusion requires probable future economic benefits and a reliably measurable cost.","es":""}},{"id":"E","text":{"fr":"","en":"The amount of these borrowing costs can be measured reliably.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000007","standard_id":"IAS23","concept_ids":["IAS23.CORE.DIRECTLY_ATTRIBUTABLE"],"dimension":"ANALYSIS","context":"V1_QST.IAS23.000007","tested_point":"QST.IAS23.000007","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":100,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"rule-attributable"},"references":["IAS 23 §10","IAS 23 §11"],"exercise":{"prompt":{"fr":"","en":"Nérée's closing file puts forward four justifications for including interest in the cost of a plant under construction. Which one is incorrect?","es":""},"explanation":{"fr":"","en":"A borrowing cost is directly attributable to the asset if it would have been avoided without the expenditure on that asset (IAS 23, paras. 10 and 11). Three justifications rest on this test; the fourth merely invokes the simultaneity of the periods, which is incorrect. Approach: test each justification with the question \"would this cost have been avoided without the expenditure?\". Trap: confusing same period with a causal link. Rule to remember: A borrowing cost is attributable to the asset if it would have been avoided without the expenditure on that asset.","es":""},"common_error":{"fr":"","en":"Capitalising interest because it falls in the same period as the works.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Interest on the loan taken out to finance the plant works, because it would not have been incurred without those works.","es":""},"correct":false,"feedback":{"fr":"","en":"This justification is correct: a borrowing cost that would not have been incurred without the expenditure is directly attributable to the asset (IAS 23, paras. 10 and 11). It is therefore not the incorrect statement. Rule to remember: A borrowing cost is attributable to the asset if it would have been avoided without the expenditure on that asset.","es":""}},{"id":"B","text":{"fr":"","en":"Interest on the part of the loan used to pay the plant's contractors, because it would have been avoided without that expenditure.","es":""},"correct":false,"feedback":{"fr":"","en":"This justification is correct: interest on the part of the loan used for the plant expenditure would have been avoided without that expenditure, so it is attributable (IAS 23, paras. 10 and 11). It is not the error sought. Rule to remember: A borrowing cost is attributable to the asset if it would have been avoided without the expenditure on that asset.","es":""}},{"id":"C","text":{"fr":"","en":"Interest on the loan that financed the advance payments to the plant's builder, because without those payments the loan would not have been needed.","es":""},"correct":false,"feedback":{"fr":"","en":"This justification is correct: the loan would not have been needed without the advance payments made for the plant, so its interest is avoidable and attributable (IAS 23, paras. 10 and 11). It is not incorrect. Rule to remember: A borrowing cost is attributable to the asset if it would have been avoided without the expenditure on that asset.","es":""}},{"id":"D","text":{"fr":"","en":"Interest on a borrowing unrelated to the plant, because it was incurred during the construction period.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000010","standard_id":"IAS23","concept_ids":["IAS23.SCOPE.GENERAL"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000010","tested_point":"QST.IAS23.000010","difficulty":"INTERMEDIATE","source":"V1","format":"TRUE_FALSE","estimated_time_s":40,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000002","section_id":"rule-scope"},"references":["IAS 23 §2","IAS 23 §3"],"exercise":{"prompt":{"fr":"","en":"For a qualifying asset, the entity may freely choose to expense all its borrowing costs, without including any of them in the cost of the asset.","es":""},"explanation":{"fr":"","en":"The standard applies in accounting for borrowing costs (IAS 23, para. 2): those directly attributable to a qualifying asset are capitalised as part of its cost, the former option to expense everything having been removed (IAS 23, para. 8). Approach: check whether the asset is qualifying, then apply the treatment set by the standard. Trap: reasoning with the former accounting policy choice, which no longer exists. Rule to remember: Borrowing costs directly attributable to a qualifying asset can no longer be expensed by choice.","es":""},"common_error":{"fr":"","en":"Believing that capitalising interest is an accounting policy choice.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000011","standard_id":"IAS23","concept_ids":["IAS23.SCOPE.EXCLUSIONS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000011","tested_point":"QST.IAS23.000011","difficulty":"INTERMEDIATE","source":"V1","format":"MULTIPLE_CHOICE","estimated_time_s":100,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000002","section_id":"rule-exclusions"},"references":["IAS 23 §4"],"exercise":{"prompt":{"fr":"","en":"For which of the following assets is the entity not required to apply the standard on borrowing costs? Several answers are correct.","es":""},"explanation":{"fr":"","en":"Paragraph 4 relieves the entity of the obligation to apply the standard (it is not required to) to borrowing costs on a qualifying asset measured at fair value (for example a biological asset) and on inventories manufactured or produced in large quantities on a repetitive basis (IAS 23, para. 4). Assets that are constructed and measured at cost remain within the scope. Approach: identify the measurement basis, then the production method. Trap: treating an asset as exempt because it takes long to build. Rule to remember: The entity is not required to apply the standard to assets measured at fair value and to inventories produced in large quantities on a repetitive basis.","es":""},"common_error":{"fr":"","en":"Treating as exempt any asset measured at cost built for own use.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"A qualifying asset measured at fair value, for example a biological asset.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"A plant whose construction takes a long period before it enters service.","es":""},"correct":false,"feedback":{"fr":"","en":"A plant under construction is the typical example of a qualifying asset: it is within the scope, not exempt (IAS 23, para. 4). Only assets measured at fair value and certain mass-produced inventories benefit from the exemption. Rule to remember: The entity is not required to apply the standard to assets measured at fair value and to inventories produced in large quantities on a repetitive basis.","es":""}},{"id":"C","text":{"fr":"","en":"An office building constructed for the entity's own use over several years.","es":""},"correct":false,"feedback":{"fr":"","en":"A building constructed over several years for the entity's own use remains within the scope if it is measured at cost: the exemption targets assets measured at fair value and certain inventories (IAS 23, para. 4). Own use exempts nothing. Rule to remember: The entity is not required to apply the standard to assets measured at fair value and to inventories produced in large quantities on a repetitive basis.","es":""}},{"id":"D","text":{"fr":"","en":"Inventories produced in large quantities on a repetitive basis.","es":""},"correct":true},{"id":"E","text":{"fr":"","en":"A power station under construction, measured at cost.","es":""},"correct":false,"feedback":{"fr":"","en":"A power station measured at cost is a typical qualifying asset and falls within the scope of the standard (IAS 23, para. 4). Measurement at fair value is what would justify the exemption. Rule to remember: The entity is not required to apply the standard to assets measured at fair value and to inventories produced in large quantities on a repetitive basis.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000012","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_ASSET"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000012","tested_point":"QST.IAS23.000012","difficulty":"BEGINNER","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"rule-qualifying"},"references":["IAS 23 §5"],"exercise":{"prompt":{"fr":"","en":"Which of these descriptions matches a qualifying asset?","es":""},"explanation":{"fr":"","en":"A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use or sale (IAS 23, para. 5). Approach: ask how long it takes to get the asset ready. Trap: defining a qualifying asset by its financing or its price. Rule to remember: An asset is qualifying when getting it ready necessarily takes a substantial period.","es":""},"common_error":{"fr":"","en":"Treating any loan-financed item as a qualifying asset.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"An asset that necessarily takes a substantial period of time to get ready for its intended use or sale.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"An asset acquired with the help of a bank loan, whatever the time needed to get it ready for use.","es":""},"correct":false,"feedback":{"fr":"","en":"Financing by borrowing is not enough: it is the preparation period, which must be substantial, that makes an asset qualifying (IAS 23, para. 5). An asset that is ready on acquisition is not one, even if loan-financed. Rule to remember: An asset is qualifying when getting it ready necessarily takes a substantial period.","es":""}},{"id":"C","text":{"fr":"","en":"An asset whose cost exceeds a high quantified threshold.","es":""},"correct":false,"feedback":{"fr":"","en":"The definition does not rest on a cost threshold: it concerns the period needed for the asset to be ready for its intended use or sale (IAS 23, para. 5). A very costly asset that can be used immediately is not qualifying. Rule to remember: An asset is qualifying when getting it ready necessarily takes a substantial period.","es":""}},{"id":"D","text":{"fr":"","en":"An asset already ready for its intended use when it is purchased.","es":""},"correct":false,"feedback":{"fr":"","en":"An asset that is ready on purchase requires no preparation period, so it does not meet the definition of a qualifying asset (IAS 23, para. 5). The interest financing it remains an expense. Rule to remember: An asset is qualifying when getting it ready necessarily takes a substantial period.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000014","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.BORROWING_COSTS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000014","tested_point":"QST.IAS23.000014","difficulty":"BEGINNER","source":"V1","format":"TRUE_FALSE","estimated_time_s":40,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"rule-borrowing"},"references":["IAS 23 §5"],"exercise":{"prompt":{"fr":"","en":"Borrowing costs are limited to the interest paid to the lender: the other costs the entity incurs in order to borrow funds are not part of them.","es":""},"explanation":{"fr":"","en":"Borrowing costs comprise interest and other costs connected with the borrowing of funds (IAS 23, para. 5). Approach: reread the definition before sorting the costs. Trap: reducing the notion to interest alone and setting aside the costs connected with the financing. Rule to remember: Borrowing costs cover interest and other costs connected with the borrowing of funds.","es":""},"common_error":{"fr":"","en":"Retaining only the interest paid and ignoring financing costs.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000015","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.BORROWING_COSTS","IAS23.BORROWING_COSTS.COMPONENTS"],"dimension":"APPLICATION","context":"V1_QST.IAS23.000015","tested_point":"QST.IAS23.000015","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":140,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"rule-borrowing"},"references":["IAS 23 §5","IAS 23 §6"],"exercise":{"prompt":{"fr":"","en":"Varenne is financing a construction project. It notes four items for its year: (1) interest on a bank loan, calculated at the effective interest rate; (2) interest on the lease liability of a lease contract; (3) the salaries of the project team; (4) the architect's fees. Which items are borrowing costs?","es":""},"explanation":{"fr":"","en":"Borrowing costs include interest calculated at the effective interest rate and interest on the lease liability (IAS 23, para. 6), as well as other costs connected with the borrowing of funds (IAS 23, para. 5). Salaries and fees are construction expenditure. Approach: ask, for each item, whether it pays for obtaining funds. Trap: classifying as borrowing costs everything that touches the project. Rule to remember: Borrowing costs are interest (borrowings, lease liability) and costs connected with borrowing funds.","es":""},"common_error":{"fr":"","en":"Putting construction expenditure among borrowing costs.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Item (1), the interest on the bank loan.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer forgets that interest on the lease liability is also a borrowing cost: the standard lists it with interest calculated at the effective interest rate (IAS 23, para. 6). Item (2) must therefore be added. Rule to remember: Borrowing costs are interest (borrowings, lease liability) and costs connected with borrowing funds.","es":""}},{"id":"B","text":{"fr":"","en":"Items (1), (2) and (3), because the project salaries are linked to the financing.","es":""},"correct":false,"feedback":{"fr":"","en":"The project team's salaries are construction costs, not costs connected with the borrowing of funds: they are not borrowing costs (IAS 23, para. 5). Borrowing costs are interest and costs connected with the financing. Rule to remember: Borrowing costs are interest (borrowings, lease liability) and costs connected with borrowing funds.","es":""}},{"id":"C","text":{"fr":"","en":"Items (1) and (2).","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"All four items, since all relate to the financed project.","es":""},"correct":false,"feedback":{"fr":"","en":"Relating to the project is not enough to be a borrowing cost: salaries and fees are construction expenditure, not costs connected with the borrowing of funds (IAS 23, para. 5). Only items (1) and (2) meet the notion. Rule to remember: Borrowing costs are interest (borrowings, lease liability) and costs connected with borrowing funds.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000016","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_EXAMPLES"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000016","tested_point":"QST.IAS23.000016","difficulty":"BEGINNER","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"examples"},"references":["IAS 23 §7"],"exercise":{"prompt":{"fr":"","en":"Among these assets, which is typically a qualifying asset?","es":""},"explanation":{"fr":"","en":"Examples of qualifying assets include plants, power generation facilities, inventories and certain intangible assets; financial assets and quickly produced inventories are not (IAS 23, para. 7). Approach: ask whether the asset needs a long preparation. Trap: selecting an asset simply because it is loan-financed. Rule to remember: A power station or plant under construction is a qualifying asset; a financial asset or a quickly produced inventory is not.","es":""},"common_error":{"fr":"","en":"Classifying a financial asset among qualifying assets.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"A portfolio of investment securities bought on the market.","es":""},"correct":false,"feedback":{"fr":"","en":"Financial assets are not qualifying assets: they require no preparation period before they are ready (IAS 23, para. 7). The interest on their financing remains an expense. Rule to remember: A power station or plant under construction is a qualifying asset; a financial asset or a quickly produced inventory is not.","es":""}},{"id":"B","text":{"fr":"","en":"Stocks of everyday products manufactured in a few days on a repetitive basis.","es":""},"correct":false,"feedback":{"fr":"","en":"Inventories produced quickly are not qualifying assets: manufacturing does not take a substantial period (IAS 23, para. 7). Inventories needing a long preparation can be. Rule to remember: A power station or plant under construction is a qualifying asset; a financial asset or a quickly produced inventory is not.","es":""}},{"id":"C","text":{"fr":"","en":"A company car bought new and delivered the same day.","es":""},"correct":false,"feedback":{"fr":"","en":"An item delivered ready for use requires no substantial preparation period and is not among the examples of qualifying assets (IAS 23, para. 7). Using a loan to buy it does not change this. Rule to remember: A power station or plant under construction is a qualifying asset; a financial asset or a quickly produced inventory is not.","es":""}},{"id":"D","text":{"fr":"","en":"A power station under construction.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000017","standard_id":"IAS23","concept_ids":["IAS23.DEFINITIONS.QUALIFYING_EXAMPLES"],"dimension":"APPLICATION","context":"V1_QST.IAS23.000017","tested_point":"QST.IAS23.000017","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":140,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000003","section_id":"examples"},"references":["IAS 23 §7"],"exercise":{"prompt":{"fr":"","en":"Sorbier borrowed to finance five assets: (a) a pharmaceutical plant whose construction takes 20 months; (b) a batch of investment securities; (c) packaging inventories manufactured in 2 days; (d) a ship under construction for 30 months; (e) software developed in-house over 24 months. Based on the standard's examples, how many of these assets can be qualifying assets?","es":""},"explanation":{"fr":"","en":"The plant (a), the ship (d) and the software (e) need a long preparation: they can be qualifying; the securities (b) are a financial asset and the packaging (c), produced in 2 days, is a quickly produced inventory, neither of which is (IAS 23, para. 7). The durations are case data. Approach: sort the five assets by preparation time. Trap: counting an asset because it is loan-financed. Rule to remember: Assets that take long to prepare, tangible or intangible, can be qualifying; financial assets and quickly produced inventories are not.","es":""},"common_error":{"fr":"","en":"Excluding software on the ground that it is not a tangible asset.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Two assets: (a) and (d), because software is not a tangible asset.","es":""},"correct":false,"feedback":{"fr":"","en":"Intangible assets are among the examples of assets that can be qualifying: software developed over 24 months can be (IAS 23, para. 7). The test is the preparation period, not whether the asset is tangible. Rule to remember: Assets that take long to prepare, tangible or intangible, can be qualifying; financial assets and quickly produced inventories are not.","es":""}},{"id":"B","text":{"fr":"","en":"Three assets: (a), (d) and (e).","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Four assets: (a), (b), (d) and (e), since the securities are loan-financed.","es":""},"correct":false,"feedback":{"fr":"","en":"A batch of investment securities is a financial asset: it needs no preparation period and is not qualifying, even if loan-financed (IAS 23, para. 7). It must therefore be left out of the count. Rule to remember: Assets that take long to prepare, tangible or intangible, can be qualifying; financial assets and quickly produced inventories are not.","es":""}},{"id":"D","text":{"fr":"","en":"Five assets, because all were financed by borrowing.","es":""},"correct":false,"feedback":{"fr":"","en":"Financing by borrowing does not make an asset qualifying: investment securities and packaging made in 2 days do not need a substantial period (IAS 23, para. 7). They are not qualifying. Rule to remember: Assets that take long to prepare, tangible or intangible, can be qualifying; financial assets and quickly produced inventories are not.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000018","standard_id":"IAS23","concept_ids":["IAS23.BORROWING_COSTS.COMPONENTS"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000018","tested_point":"QST.IAS23.000018","difficulty":"INTERMEDIATE","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"rule-components"},"references":["IAS 23 §6"],"exercise":{"prompt":{"fr":"","en":"Delmas drew a loan of {principal} at an effective interest rate of {effective_rate} a year. The loan was outstanding for {months_outstanding} of the year. Calculate the interest for the year on this loan, at the effective interest rate.","es":""},"explanation":{"fr":"","en":"Borrowing costs include interest calculated using the effective interest method (IAS 23, para. 6). Approach: 2,500,000 × 6.4% = 160,000 for a full year; × 9/12 = 120,000. Trap: using a full year, that is 160,000, although the loan was outstanding for only 9 months. Rule to remember: Interest for the period = principal × effective rate × fraction of the period.","es":""},"common_error":{"fr":"","en":"Applying the annual rate without allowing for the actual time the loan was outstanding.","es":""},"format":"CALCULATION","placeholders":[{"id":"principal","value":"2500000","unit":"EUR"},{"id":"effective_rate","value":"6.4","unit":"PERCENT"},{"id":"months_outstanding","value":"9","unit":"MONTHS"}],"data":[{"label":{"fr":"","en":"Principal borrowed","es":""},"value":"2500000","unit":"EUR"},{"label":{"fr":"","en":"Annual effective interest rate","es":""},"value":"6.4","unit":"PERCENT"},{"label":{"fr":"","en":"Time outstanding in the year","es":""},"value":"9","unit":"MONTHS"}],"steps":[{"id":"BORROWING_COSTS","label":{"fr":"","en":"Interest for the year","es":""},"answer":120000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000019","standard_id":"IAS23","concept_ids":["IAS23.BORROWING_COSTS.COMPONENTS"],"dimension":"APPLICATION","context":"V1_QST.IAS23.000019","tested_point":"QST.IAS23.000019","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":140,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"rule-components"},"references":["IAS 23 §6"],"exercise":{"prompt":{"fr":"","en":"Trianon is building a logistics centre. For the year, it notes: 190,000 of interest on a bond, calculated at the effective interest rate; 35,000 of interest on the lease liability of a leased warehouse; and an exchange difference of 22,000 on a dollar loan, of which 14,000 is regarded as an adjustment to interest (case data). What is the total of the borrowing costs for the year?","es":""},"explanation":{"fr":"","en":"Borrowing costs include interest at the effective interest rate, interest on the lease liability and the part of exchange differences regarded as an adjustment to interest (IAS 23, para. 6). Total = 190,000 + 35,000 + 14,000 = 239,000. The 14,000 part is case data, not a threshold in the standard. Approach: add the three components retained. Trap: omitting a component or taking the exchange difference in full. Rule to remember: Borrowing costs add effective interest, interest on lease liabilities and the part of exchange differences regarded as an adjustment to interest.","es":""},"common_error":{"fr":"","en":"Adding the whole exchange difference or forgetting interest on the lease liability.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"239,000","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"225,000","es":""},"correct":false,"feedback":{"fr":"","en":"This total leaves out the part of the exchange difference regarded as an adjustment to interest: 190,000 + 35,000 = 225,000 (IAS 23, para. 6). 14,000 is missing. Rule to remember: Borrowing costs add effective interest, interest on lease liabilities and the part of exchange differences regarded as an adjustment to interest.","es":""}},{"id":"C","text":{"fr":"","en":"247,000","es":""},"correct":false,"feedback":{"fr":"","en":"This total takes the whole exchange difference of 22,000: the part regarded as an adjustment to interest, 14,000 (case data), enters borrowing costs (IAS 23, para. 6). 190,000 + 35,000 + 22,000 overstates the total by 8,000. Rule to remember: Borrowing costs add effective interest, interest on lease liabilities and the part of exchange differences regarded as an adjustment to interest.","es":""}},{"id":"D","text":{"fr":"","en":"204,000","es":""},"correct":false,"feedback":{"fr":"","en":"This total leaves out the 35,000 of interest on the lease liability, which is part of borrowing costs (IAS 23, para. 6). 190,000 + 14,000 = 204,000 is therefore incomplete. Rule to remember: Borrowing costs add effective interest, interest on lease liabilities and the part of exchange differences regarded as an adjustment to interest.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000020","standard_id":"IAS23","concept_ids":["IAS23.BORROWING_COSTS.FX_DIFFERENCES"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000020","tested_point":"QST.IAS23.000020","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"rule-fx"},"references":["IAS 23 §6"],"exercise":{"prompt":{"fr":"","en":"Nérée borrowed in a foreign currency to finance a qualifying asset. Which statement is consistent with the standard's list of borrowing costs?","es":""},"explanation":{"fr":"","en":"The list of borrowing costs includes exchange differences to the extent that they are regarded as an adjustment to interest (IAS 23, para. 6). Assessing that part is a judgement: the method is not imposed by the standard in this course. Approach: isolate the part that can be regarded as an adjustment to interest. Trap: taking all of it or none of it. Rule to remember: Exchange differences are borrowing costs to the extent that they are regarded as an adjustment to interest.","es":""},"common_error":{"fr":"","en":"Capitalising the whole of an exchange difference or none of it.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Exchange differences on the foreign-currency loan are borrowing costs, whatever their nature.","es":""},"correct":false,"feedback":{"fr":"","en":"The standard does not retain all exchange differences: the part regarded as an adjustment to interest enters borrowing costs (IAS 23, para. 6). The surplus is dealt with outside this standard. Rule to remember: Exchange differences are borrowing costs to the extent that they are regarded as an adjustment to interest.","es":""}},{"id":"B","text":{"fr":"","en":"An exchange difference cannot be a borrowing cost, because it is not interest.","es":""},"correct":false,"feedback":{"fr":"","en":"The list of borrowing costs expressly mentions exchange differences regarded as an adjustment to interest (IAS 23, para. 6). Excluding all of them would ignore this component. Rule to remember: Exchange differences are borrowing costs to the extent that they are regarded as an adjustment to interest.","es":""}},{"id":"C","text":{"fr":"","en":"Favourable exchange differences reduce the borrowing costs capitalised.","es":""},"correct":false,"feedback":{"fr":"","en":"The test is not the direction of the difference but whether it is regarded as an adjustment to interest (IAS 23, para. 6). Distinguishing gains from losses does not answer the question the standard asks. Rule to remember: Exchange differences are borrowing costs to the extent that they are regarded as an adjustment to interest.","es":""}},{"id":"D","text":{"fr":"","en":"Exchange differences are borrowing costs to the extent that they are regarded as an adjustment to interest.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000021","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.ACTUAL_COSTS","IAS23.SPECIFIC.DETAIL"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000021","tested_point":"QST.IAS23.000021","difficulty":"BEGINNER","source":"V1","format":"TRUE_FALSE","estimated_time_s":40,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-actual"},"references":["IAS 23 §12","IAS 23 §13"],"exercise":{"prompt":{"fr":"","en":"For a borrowing taken out specifically to obtain a qualifying asset, the borrowing costs eligible for capitalisation start from the costs actually incurred on that borrowing during the period, not from an average rate computed on all borrowings.","es":""},"explanation":{"fr":"","en":"For a specific borrowing, the costs eligible for capitalisation are the actual costs of the period on that borrowing, less any income from its temporary investment (IAS 23, paras. 12 and 13). The capitalisation rate for general borrowings does not apply to it. Approach: identify whether the borrowing is dedicated to the asset. Trap: applying an average rate to a dedicated borrowing. Rule to remember: A specific borrowing is measured at its actual costs for the period, not at an average rate.","es":""},"common_error":{"fr":"","en":"Applying the average rate of general borrowings to a borrowing dedicated to the asset.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000022","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.ACTUAL_COSTS","IAS23.SPECIFIC.DETAIL"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000022","tested_point":"QST.IAS23.000022","difficulty":"ADVANCED","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-actual"},"references":["IAS 23 §12","IAS 23 §13"],"exercise":{"prompt":{"fr":"","en":"Brisac drew a loan of {principal} on 1 March, dedicated to the construction of a plant, at an effective interest rate of {effective_rate} a year. Expenditure, borrowing costs and preparation activities all begin the same day (case data) and the year ends on 31 December, that is {months_capitalised}. No funds are temporarily invested. Calculate the borrowing costs eligible for capitalisation for the year.","es":""},"explanation":{"fr":"","en":"For a specific borrowing, the costs eligible for capitalisation are the actual costs of the period (IAS 23, paras. 12 and 13). Annual interest: 3,000,000 × 6% = 180,000; for 10 months: 180,000 × 10/12 = 150,000. No investment income is to be deducted (case data). Trap: using 12 months, that is 180,000, although the loan has existed only since 1 March. Rule to remember: The costs eligible for capitalisation on a specific borrowing are its actual interest over the period in which it finances the asset.","es":""},"common_error":{"fr":"","en":"Taking a full year of interest for a loan drawn during the year.","es":""},"format":"CALCULATION","placeholders":[{"id":"principal","value":"3000000","unit":"EUR"},{"id":"effective_rate","value":"6","unit":"PERCENT"},{"id":"months_capitalised","value":"10","unit":"MONTHS"}],"data":[{"label":{"fr":"","en":"Specific borrowing","es":""},"value":"3000000","unit":"EUR"},{"label":{"fr":"","en":"Annual effective interest rate","es":""},"value":"6","unit":"PERCENT"},{"label":{"fr":"","en":"Time to the reporting date","es":""},"value":"10","unit":"MONTHS"}],"steps":[{"id":"ELIGIBLE_COSTS","label":{"fr":"","en":"Costs eligible for capitalisation","es":""},"answer":150000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"ELIGIBLE_COSTS","meaning":{"fr":"","en":"Costs eligible for capitalisation","es":""},"expression":"(a * b) * c / 12","variables":[{"symbol":"a","meaning":{"fr":"","en":"Specific borrowing","es":""},"value":3000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Annual effective interest rate","es":""},"value":6,"unit":"PERCENT"},{"symbol":"c","meaning":{"fr":"","en":"Time to the reporting date","es":""},"value":10,"unit":"MONTHS"}],"result":150000,"unit":"EUR"}],"rationale":{"fr":"","en":"The costs eligible for capitalisation on a specific borrowing are its actual interest over the period in which it finances the asset.","es":""},"references":["REF.IAS23.12","REF.IAS23.13"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000023","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.ACTUAL_COSTS","IAS23.COMMENCEMENT.CONDITIONS","IAS23.SPECIFIC.DETAIL","IAS23.BORROWING_COSTS.COMPONENTS"],"dimension":"APPLICATION","context":"V1_QST.IAS23.000023","tested_point":"QST.IAS23.000023","difficulty":"EXPERT","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":140,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000004","section_id":"rule-components"},"references":["IAS 23 §12","IAS 23 §13","IAS 23 §6","IAS 23 §17"],"exercise":{"prompt":{"fr":"","en":"Hélios draws a specific borrowing of 6,000,000 on 1 January, dedicated to the construction of a warehouse. Its nominal rate is 4.5%, but its effective interest rate, which includes the issue costs, is 6% (case data). Expenditure, borrowing costs and preparation activities are all in place from 1 March; the year ends on 31 December and no funds are temporarily invested. What amount of borrowing costs is eligible for capitalisation for the year?","es":""},"explanation":{"fr":"","en":"The actual costs of a specific borrowing are its interest at the effective interest rate (IAS 23, para. 6) over the period in which capitalisation is open, that is from 1 March, when expenditure, borrowing costs and preparation activities are all in place (IAS 23, para. 17); these costs form the amount eligible for capitalisation (IAS 23, paras. 12 and 13). Calculation: 6,000,000 × 6% × 10/12 = 300,000. The 60,000 for January and February remains an expense. Effect: 300,000 increases assets and 60,000 reduces profit. Trap: using the nominal rate or the full year. Rule to remember: A specific borrowing gives costs eligible for capitalisation at the effective rate, from the commencement date of capitalisation.","es":""},"common_error":{"fr":"","en":"Calculating interest at the nominal rate and over the whole life of the loan.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"360,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount covers the 12 months at the effective rate: it ignores that capitalisation starts only on 1 March, when the three conditions are met (IAS 23, para. 17). The interest for January and February is an expense. Rule to remember: A specific borrowing gives costs eligible for capitalisation at the effective rate, from the commencement date of capitalisation.","es":""}},{"id":"B","text":{"fr":"","en":"300,000","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"225,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount applies the nominal rate of 4.5% over 10 months: but borrowing costs include interest calculated at the effective interest rate, which is 6% here (IAS 23, para. 6). The calculation must start from that rate. Rule to remember: A specific borrowing gives costs eligible for capitalisation at the effective rate, from the commencement date of capitalisation.","es":""}},{"id":"D","text":{"fr":"","en":"270,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount combines two errors: the nominal rate of 4.5% instead of the effective rate of 6% (IAS 23, para. 6), and 12 months instead of the 10 months of capitalisation (IAS 23, para. 17). 6,000,000 × 4.5% = 270,000 reflects neither. Rule to remember: A specific borrowing gives costs eligible for capitalisation at the effective rate, from the commencement date of capitalisation.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000024","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.INVESTMENT_INCOME","IAS23.SPECIFIC.DETAIL"],"dimension":"CALCULATION","context":"V1_VG.IAS23.000001","tested_point":"VG.IAS23.000001","difficulty":"INTERMEDIATE","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-income"},"references":["IAS 23 §12","IAS 23 §13"],"exercise":{"prompt":{"fr":"","en":"Cordier finances a power station with a specific borrowing whose actual costs for the year are {actual_costs}. For {months_invested}, part of the funds not yet spent, {unspent_proceeds}, is temporarily invested at {investment_rate} a year. Calculate the investment income, then the amount of borrowing costs eligible for capitalisation.","es":""},"explanation":{"fr":"","en":"The costs eligible for capitalisation on a specific borrowing are its actual costs for the period less the income from its temporary investment (IAS 23, paras. 12 and 13). Income = 1,500,000 × 2% × 6/12 = 15,000. Costs eligible = 90,000 − 15,000 = 75,000. Trap: capitalising 90,000 without deducting the investment income. Rule to remember: Costs eligible = actual costs of the specific borrowing − income from the temporary investment of the funds.","es":""},"common_error":{"fr":"","en":"Capitalising the actual costs without deducting the temporary investment income.","es":""},"format":"CALCULATION","placeholders":[{"id":"actual_costs","value":"90000","unit":"EUR"},{"id":"unspent_proceeds","value":"1500000","unit":"EUR"},{"id":"investment_rate","value":"2","unit":"PERCENT"},{"id":"months_invested","value":"6","unit":"MONTHS"}],"data":[{"label":{"fr":"","en":"Actual costs of the borrowing","es":""},"value":"90000","unit":"EUR"},{"label":{"fr":"","en":"Unspent funds invested","es":""},"value":"1500000","unit":"EUR"},{"label":{"fr":"","en":"Annual investment rate","es":""},"value":"2","unit":"PERCENT"},{"label":{"fr":"","en":"Investment period","es":""},"value":"6","unit":"MONTHS"}],"steps":[{"id":"INVESTMENT_INCOME","label":{"fr":"","en":"Temporary investment income","es":""},"answer":15000,"tolerance":0,"unit":"EUR"},{"id":"ELIGIBLE_COSTS","label":{"fr":"","en":"Costs eligible for capitalisation","es":""},"answer":75000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"INVESTMENT_INCOME","meaning":{"fr":"","en":"Temporary investment income","es":""},"expression":"a * b * c / 12","variables":[{"symbol":"a","meaning":{"fr":"","en":"Unspent funds invested","es":""},"value":1500000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Annual investment rate","es":""},"value":2,"unit":"PERCENT"},{"symbol":"c","meaning":{"fr":"","en":"Investment period","es":""},"value":6,"unit":"MONTHS"}],"result":15000,"unit":"EUR"},{"step":"ELIGIBLE_COSTS","meaning":{"fr":"","en":"Costs eligible for capitalisation","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Actual costs of the borrowing","es":""},"value":90000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Temporary investment income","es":""},"value":15000,"unit":"EUR"}],"result":75000,"unit":"EUR"}],"rationale":{"fr":"","en":"Costs eligible = actual costs of the specific borrowing − income from the temporary investment of the funds.","es":""},"references":["REF.IAS23.12","REF.IAS23.13"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000026","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.INVESTMENT_INCOME","IAS23.SPECIFIC.DETAIL"],"dimension":"APPLICATION","context":"V1_QST.IAS23.000026","tested_point":"QST.IAS23.000026","difficulty":"EXPERT","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":140,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-income"},"references":["IAS 23 §12","IAS 23 §13"],"exercise":{"prompt":{"fr":"","en":"Orvault finances a power station with a specific borrowing of 8,000,000 at 6% a year, drawn on 1 January; capitalisation is open all year. The funds not yet spent were temporarily invested and earned 55,000 over the year (case data). Which treatment of borrowing costs is correct for the year?","es":""},"explanation":{"fr":"","en":"The actual costs for the year are 8,000,000 × 6% = 480,000. The costs eligible are these costs less the income from temporary investment: 480,000 − 55,000 = 425,000 (IAS 23, paras. 12 and 13). Case convention: the income is deducted from the amount capitalised, with no separate income in profit; no interest expense remains. Effect: assets increase by 425,000 and profit is not affected. Trap: capitalising the gross amount and also recognising the income. Rule to remember: The amount capitalised on a specific borrowing is net of the investment income, which is not counted a second time.","es":""},"common_error":{"fr":"","en":"Counting the investment income both as a deduction from the asset and in profit.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"425,000 included in the cost of the power station; the 55,000 of investment income is deducted, with no separate income in profit.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"480,000 included in the cost of the power station; the 55,000 of investment income is recognised as finance income for the year.","es":""},"correct":false,"feedback":{"fr":"","en":"Capitalising the full 480,000 ignores the deduction of the investment income: the costs eligible are the actual costs less that income (IAS 23, paras. 12 and 13). The amount capitalised must be 425,000. Rule to remember: The amount capitalised on a specific borrowing is net of the investment income, which is not counted a second time.","es":""}},{"id":"C","text":{"fr":"","en":"425,000 included; in addition, the 55,000 of investment income is recognised as finance income for the year.","es":""},"correct":false,"feedback":{"fr":"","en":"The investment income is already deducted from the amount capitalised, as the case convention provides: also recognising it in profit would count it twice (IAS 23, paras. 12 and 13). The 425,000 capitalised already takes this income into account. Rule to remember: The amount capitalised on a specific borrowing is net of the investment income, which is not counted a second time.","es":""}},{"id":"D","text":{"fr":"","en":"480,000 expensed, because the power station is not yet in service; the 55,000 of investment income is recognised as finance income.","es":""},"correct":false,"feedback":{"fr":"","en":"A power station under construction is a qualifying asset and the borrowing financing it is specific: its actual costs, net of investment income, are capitalised, not expensed (IAS 23, paras. 12 and 13). Entry into service is not a condition for capitalisation. Rule to remember: The amount capitalised on a specific borrowing is net of the investment income, which is not counted a second time.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000027","standard_id":"IAS23","concept_ids":["IAS23.SPECIFIC.DETAIL","IAS23.SPECIFIC.ACTUAL_COSTS"],"dimension":"ANALYSIS","context":"V1_QST.IAS23.000027","tested_point":"QST.IAS23.000027","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":100,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000005","section_id":"rule-actual"},"references":["IAS 23 §13","IAS 23 §12"],"exercise":{"prompt":{"fr":"","en":"The internal controller rereads the file of Orsay, which finances a power station with a specific borrowing. Which of the following sentences is incorrect?","es":""},"explanation":{"fr":"","en":"For a specific borrowing, the costs eligible for capitalisation are the actual costs for the period less the income from temporary investment of unspent funds (IAS 23, paras. 12 and 13). The sentence that adds this income reverses the rule. Approach: reread each sentence in light of the deduction of the income. Trap: treating investment income as a supplement to the amount capitalised. Rule to remember: Income from the temporary investment of borrowed funds is deducted from the costs eligible; it is not added to them.","es":""},"common_error":{"fr":"","en":"Adding the investment income instead of deducting it.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"\"The costs eligible for capitalisation start from the actual costs of the borrowing for the period.\"","es":""},"correct":false,"feedback":{"fr":"","en":"This sentence is correct: for a specific borrowing, the costs eligible are the actual costs of the period, less income from temporary investment (IAS 23, paras. 12 and 13). It is not the incorrect statement. Rule to remember: Income from the temporary investment of borrowed funds is deducted from the costs eligible; it is not added to them.","es":""}},{"id":"B","text":{"fr":"","en":"\"Income from the temporary investment of unspent funds is deducted from the costs eligible for capitalisation.\"","es":""},"correct":false,"feedback":{"fr":"","en":"This sentence is correct: income from the temporary investment of borrowed funds not yet spent is deducted from the costs eligible (IAS 23, paras. 12 and 13). It does not contain the error. Rule to remember: Income from the temporary investment of borrowed funds is deducted from the costs eligible; it is not added to them.","es":""}},{"id":"C","text":{"fr":"","en":"\"Income from the temporary investment of unspent funds is added to the costs eligible for capitalisation.\"","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"\"An average rate of general borrowings does not replace the actual costs of a specific borrowing.\"","es":""},"correct":false,"feedback":{"fr":"","en":"This sentence is correct: the specific borrowing is measured at its own actual costs, whereas the average rate applies to general borrowings (IAS 23, paras. 12 and 13). The error lies elsewhere. Rule to remember: Income from the temporary investment of borrowed funds is deducted from the costs eligible; it is not added to them.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000028","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000028","tested_point":"QST.IAS23.000028","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-rate"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"For funds borrowed generally and used to obtain a qualifying asset, how is the capitalisation rate determined?","es":""},"explanation":{"fr":"","en":"For general borrowings, the capitalisation rate is the weighted average of the borrowing costs of the period, applied to the expenditure on the asset (IAS 23, para. 14). Approach: weight each borrowing by its outstanding amount, then relate the costs to the amounts outstanding. Trap: replacing the weighting with a single rate or a simple average. Rule to remember: The capitalisation rate for general borrowings is the weighted average of the borrowing costs of the period.","es":""},"common_error":{"fr":"","en":"Using the rate of a single borrowing or a simple average as the capitalisation rate.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It is the rate of the most recent borrowing taken out by the entity, applied to the expenditure on the asset.","es":""},"correct":false,"feedback":{"fr":"","en":"Taking the rate of the latest borrowing ignores the other borrowings outstanding: the capitalisation rate is the weighted average of the borrowing costs of the period (IAS 23, para. 14). A single borrowing does not represent general financing. Rule to remember: The capitalisation rate for general borrowings is the weighted average of the borrowing costs of the period.","es":""}},{"id":"B","text":{"fr":"","en":"It is the weighted average of the borrowing costs of the period, then applied to the expenditure on the asset.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"It is the lowest of the interest rates on the entity's borrowings, as a matter of caution.","es":""},"correct":false,"feedback":{"fr":"","en":"Choosing the lowest rate is not the method: the capitalisation rate is a weighted average of the borrowing costs of the period, which allows for all general borrowings (IAS 23, para. 14). Caution does not replace weighting. Rule to remember: The capitalisation rate for general borrowings is the weighted average of the borrowing costs of the period.","es":""}},{"id":"D","text":{"fr":"","en":"It is the simple arithmetic average of the nominal rates, regardless of the amount of each borrowing.","es":""},"correct":false,"feedback":{"fr":"","en":"A simple average of rates gives the same weight to a small and a large borrowing: the standard uses a weighted average of the borrowing costs of the period (IAS 23, para. 14). A larger borrowing weighs more in the rate. Rule to remember: The capitalisation rate for general borrowings is the weighted average of the borrowing costs of the period.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000029","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000029","tested_point":"QST.IAS23.000029","difficulty":"ADVANCED","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-rate"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"Mauzac's general borrowings, outstanding all year, are: a borrowing of {borrowing_a} (costs for the year: {costs_a}) and a borrowing of {borrowing_b} (costs for the year: {costs_b}). Calculate the capitalisation rate for the year.","es":""},"explanation":{"fr":"","en":"The capitalisation rate is the weighted average of the borrowing costs of the period (IAS 23, para. 14). Total costs = 280,000 + 300,000 = 580,000; average amount outstanding = 4,000,000 + 6,000,000 = 10,000,000 (outstanding all year). Rate = 580,000 / 10,000,000 = 5.8%. Trap: taking the simple average of the two rates (7% and 5%), that is 6%. Rule to remember: Capitalisation rate = borrowing costs of the period ÷ weighted average of general borrowings outstanding.","es":""},"common_error":{"fr":"","en":"Taking the simple average of the rates instead of weighting by amounts outstanding.","es":""},"format":"CALCULATION","placeholders":[{"id":"borrowing_a","value":"4000000","unit":"EUR"},{"id":"costs_a","value":"280000","unit":"EUR"},{"id":"borrowing_b","value":"6000000","unit":"EUR"},{"id":"costs_b","value":"300000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"Borrowing A","es":""},"value":"4000000","unit":"EUR"},{"label":{"fr":"","en":"Costs of borrowing A","es":""},"value":"280000","unit":"EUR"},{"label":{"fr":"","en":"Borrowing B","es":""},"value":"6000000","unit":"EUR"},{"label":{"fr":"","en":"Costs of borrowing B","es":""},"value":"300000","unit":"EUR"}],"steps":[{"id":"CAPITALISATION_RATE","label":{"fr":"","en":"Capitalisation rate","es":""},"answer":5.8,"tolerance":0,"unit":"PERCENT"}],"formula":{"lines":[{"step":"CAPITALISATION_RATE","meaning":{"fr":"","en":"Capitalisation rate","es":""},"expression":"(a + b) / (c + d)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Costs of borrowing A","es":""},"value":280000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Costs of borrowing B","es":""},"value":300000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Borrowing A","es":""},"value":4000000,"unit":"EUR"},{"symbol":"d","meaning":{"fr":"","en":"Borrowing B","es":""},"value":6000000,"unit":"EUR"}],"result":5.8,"unit":"PERCENT"}],"rationale":{"fr":"","en":"Capitalisation rate = borrowing costs of the period ÷ weighted average of general borrowings outstanding.","es":""},"references":["REF.IAS23.14"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000032","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.RATE_AFTER_2019"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000032","tested_point":"QST.IAS23.000032","difficulty":"ADVANCED","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-after2019"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"Quenelle has a general borrowing of {general_borrowing} (costs for the year: {general_costs}). In addition, a specific borrowing of {specific_borrowing}, taken out for an asset completed before the start of the year, remains outstanding all year (costs for the year: {specific_costs}). Calculate the capitalisation rate for general borrowings for the year, allowing for the treatment of the specific borrowing still outstanding.","es":""},"explanation":{"fr":"","en":"Since the 2015-2017 improvements, a specific borrowing still outstanding after its asset is complete joins general borrowings in the calculation of the rate (IAS 23, para. 14). Costs = 210,000 + 100,000 = 310,000; amounts outstanding = 3,000,000 + 2,000,000 = 5,000,000. Rate = 310,000 / 5,000,000 = 6.2%. Trap: retaining only the general borrowing, which would give 7%. Rule to remember: A specific borrowing still outstanding after its asset is complete enters the calculation of the rate for general borrowings.","es":""},"common_error":{"fr":"","en":"Excluding from the rate the specific borrowing whose asset is already complete.","es":""},"format":"CALCULATION","placeholders":[{"id":"general_borrowing","value":"3000000","unit":"EUR"},{"id":"general_costs","value":"210000","unit":"EUR"},{"id":"specific_borrowing","value":"2000000","unit":"EUR"},{"id":"specific_costs","value":"100000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"General borrowing","es":""},"value":"3000000","unit":"EUR"},{"label":{"fr":"","en":"Costs of the general borrowing","es":""},"value":"210000","unit":"EUR"},{"label":{"fr":"","en":"Specific borrowing still outstanding","es":""},"value":"2000000","unit":"EUR"},{"label":{"fr":"","en":"Costs of the specific borrowing","es":""},"value":"100000","unit":"EUR"}],"steps":[{"id":"CAPITALISATION_RATE","label":{"fr":"","en":"Capitalisation rate","es":""},"answer":6.2,"tolerance":0,"unit":"PERCENT"}],"formula":{"lines":[{"step":"CAPITALISATION_RATE","meaning":{"fr":"","en":"Capitalisation rate","es":""},"expression":"(a + b) / (c + d)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Costs of the general borrowing","es":""},"value":210000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Costs of the specific borrowing","es":""},"value":100000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"General borrowing","es":""},"value":3000000,"unit":"EUR"},{"symbol":"d","meaning":{"fr":"","en":"Specific borrowing still outstanding","es":""},"value":2000000,"unit":"EUR"}],"result":6.2,"unit":"PERCENT"}],"rationale":{"fr":"","en":"A specific borrowing still outstanding after its asset is complete enters the calculation of the rate for general borrowings.","es":""},"references":["REF.IAS23.14"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000034","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.GROUP_POOLING"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000034","tested_point":"QST.IAS23.000034","difficulty":"ADVANCED","source":"V1","format":"TRUE_FALSE","estimated_time_s":40,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-pooling"},"references":["IAS 23 §15"],"exercise":{"prompt":{"fr":"","en":"Within a group, the standard prohibits pooling the borrowings of the parent and its subsidiaries to compute the weighted average of borrowing costs.","es":""},"explanation":{"fr":"","en":"The standard contemplates the possibility of pooling the borrowings of the parent and its subsidiaries to compute the weighted average (IAS 23, para. 15). Assessing whether pooling is appropriate is a judgement based on the group's facts. Approach: examine how financing is organised within the group. Trap: asserting a general prohibition that the text does not state. Rule to remember: Pooling a group's borrowings is a possibility whose appropriateness is judged on the facts.","es":""},"common_error":{"fr":"","en":"Believing that the borrowings of the parent and subsidiaries can never be pooled.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000035","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.GROUP_POOLING","IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000035","tested_point":"QST.IAS23.000035","difficulty":"EXPERT","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-rate"},"references":["IAS 23 §15","IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"The Sérignan group finances a plant with the general borrowings of the parent ({parent_borrowings}, costs for the year: {parent_costs}) and those of a subsidiary ({subsidiary_borrowings}, costs for the year: {subsidiary_costs}), outstanding all year. Group judgement (case data): pooling the borrowings is appropriate for computing the rate. The weighted average expenditure on the plant is {weighted_expenditure}. Calculate the group's capitalisation rate and the costs eligible for capitalisation.","es":""},"explanation":{"fr":"","en":"Where pooling is adopted, the weighted average covers the borrowings of the parent and the subsidiary together (IAS 23, para. 15), and the rate is then applied to the expenditure on the asset (IAS 23, para. 14). Costs = 400,000 + 320,000 = 720,000; amounts outstanding = 8,000,000 + 4,000,000 = 12,000,000; rate = 6%. Costs eligible = 2,500,000 × 6% = 150,000. Pooling is a judgement given by the case, not an obligation. Trap: computing the parent's rate alone, that is 5%, and obtaining 125,000. Rule to remember: With pooling, the capitalisation rate weights the borrowings of the parent and subsidiaries together.","es":""},"common_error":{"fr":"","en":"Computing the parent's rate alone although pooling is adopted.","es":""},"format":"CALCULATION","placeholders":[{"id":"parent_borrowings","value":"8000000","unit":"EUR"},{"id":"parent_costs","value":"400000","unit":"EUR"},{"id":"subsidiary_borrowings","value":"4000000","unit":"EUR"},{"id":"subsidiary_costs","value":"320000","unit":"EUR"},{"id":"weighted_expenditure","value":"2500000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"Parent borrowings","es":""},"value":"8000000","unit":"EUR"},{"label":{"fr":"","en":"Parent costs","es":""},"value":"400000","unit":"EUR"},{"label":{"fr":"","en":"Subsidiary borrowings","es":""},"value":"4000000","unit":"EUR"},{"label":{"fr":"","en":"Subsidiary costs","es":""},"value":"320000","unit":"EUR"},{"label":{"fr":"","en":"Weighted average expenditure on the plant","es":""},"value":"2500000","unit":"EUR"}],"steps":[{"id":"POOLED_RATE","label":{"fr":"","en":"Group capitalisation rate","es":""},"answer":6,"tolerance":0,"unit":"PERCENT"},{"id":"ELIGIBLE_COSTS","label":{"fr":"","en":"Costs eligible for capitalisation","es":""},"answer":150000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"ELIGIBLE_COSTS","meaning":{"fr":"","en":"Costs eligible for capitalisation","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Weighted average expenditure on the plant","es":""},"value":2500000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Group capitalisation rate","es":""},"value":6,"unit":"PERCENT"}],"result":150000,"unit":"EUR"}],"rationale":{"fr":"","en":"With pooling, the capitalisation rate weights the borrowings of the parent and subsidiaries together.","es":""},"references":["REF.IAS23.15","REF.IAS23.14"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000036","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAP"],"dimension":"CALCULATION","context":"V1_VG.IAS23.000002","tested_point":"VG.IAS23.000002","difficulty":"INTERMEDIATE","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-cap"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"For a qualifying asset financed by its general borrowings, Altair calculates costs eligible for capitalisation of {calculated_costs}, whereas its borrowing costs incurred in the year amount to {borrowing_costs_incurred}. What amount can be capitalised in the asset?","es":""},"explanation":{"fr":"","en":"The costs capitalised do not exceed the borrowing costs incurred in the period (IAS 23, para. 14). The amount that can be capitalised is the lower of the two: minimum (95,000; 80,000) = 80,000. Trap: capitalising 95,000, a calculated amount higher than the costs actually incurred. Rule to remember: The amount capitalised is the lower of the costs calculated and the borrowing costs incurred in the period.","es":""},"common_error":{"fr":"","en":"Capitalising the calculated amount even if it exceeds the borrowing costs incurred.","es":""},"format":"CALCULATION","placeholders":[{"id":"calculated_costs","value":"95000","unit":"EUR"},{"id":"borrowing_costs_incurred","value":"80000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"Costs calculated (expenditure × rate)","es":""},"value":"95000","unit":"EUR"},{"label":{"fr":"","en":"Borrowing costs incurred","es":""},"value":"80000","unit":"EUR"}],"steps":[{"id":"CAPITALISED_AMOUNT","label":{"fr":"","en":"Amount that can be capitalised","es":""},"answer":80000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"CAPITALISED_AMOUNT","meaning":{"fr":"","en":"Amount that can be capitalised","es":""},"expression":"min(a, b)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Costs calculated (expenditure × rate)","es":""},"value":95000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Borrowing costs incurred","es":""},"value":80000,"unit":"EUR"}],"result":80000,"unit":"EUR"}],"rationale":{"fr":"","en":"The amount capitalised is the lower of the costs calculated and the borrowing costs incurred in the period.","es":""},"references":["REF.IAS23.14"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000037","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAP"],"dimension":"ANALYSIS","context":"V1_VG.IAS23.000002","tested_point":"VG.IAS23.000002","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":100,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-cap"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"Four colleagues comment on the cap applicable to capitalised borrowing costs. Which of the following statements is incorrect?","es":""},"explanation":{"fr":"","en":"The costs capitalised do not exceed the borrowing costs incurred in the period (IAS 23, para. 14). Three statements describe this cap correctly; the last one permits capitalising the excess, which is incorrect. Approach: apply the rule \"minimum of costs calculated and costs incurred\" to each statement. Trap: believing the excess is a real cost that can be capitalised. Rule to remember: The amount capitalised cannot exceed the borrowing costs incurred in the period.","es":""},"common_error":{"fr":"","en":"Capitalising the excess of the amount calculated over the costs incurred.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"\"The amount capitalised does not exceed the borrowing costs incurred in the period.\"","es":""},"correct":false,"feedback":{"fr":"","en":"This statement is correct: it is the cap itself (IAS 23, para. 14). It is therefore not the error sought. Rule to remember: The amount capitalised cannot exceed the borrowing costs incurred in the period.","es":""}},{"id":"B","text":{"fr":"","en":"\"If the amount calculated is lower than the costs incurred, the amount capitalised is the amount calculated.\"","es":""},"correct":false,"feedback":{"fr":"","en":"This statement is correct: the cap bites only if the amount calculated exceeds the costs incurred; otherwise, the amount calculated is used (IAS 23, para. 14). It is not incorrect. Rule to remember: The amount capitalised cannot exceed the borrowing costs incurred in the period.","es":""}},{"id":"C","text":{"fr":"","en":"\"The cap is checked period by period, comparing the amount calculated with the costs incurred in that period.\"","es":""},"correct":false,"feedback":{"fr":"","en":"This statement is correct: the cap relates to the borrowing costs incurred in the period, hence a comparison in each period (IAS 23, para. 14). It is not the incorrect statement. Rule to remember: The amount capitalised cannot exceed the borrowing costs incurred in the period.","es":""}},{"id":"D","text":{"fr":"","en":"\"If the amount calculated exceeds the costs incurred, the calculated amount is capitalised, the excess being a real cost.\"","es":""},"correct":true}]},"scope":"CORE_STUDENT","reserve":true},{"key":"QST.IAS23.000038","standard_id":"IAS23","concept_ids":["IAS23.GENERAL.CAP","IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"APPLICATION","context":"V1_VG.IAS23.000002","tested_point":"VG.IAS23.000002","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":140,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-rate"},"references":["IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"Brémont is building a warehouse financed by its general borrowings: 3,000,000 outstanding all year, with borrowing costs incurred of 195,000 (a capitalisation rate of 6.5%). The weighted average expenditure on the warehouse is 3,400,000 (case data, part being financed from own cash). What amount of borrowing costs can be capitalised for the year?","es":""},"explanation":{"fr":"","en":"The capitalisation rate is 195,000 / 3,000,000 = 6.5%; applied to the weighted expenditure, it gives 3,400,000 × 6.5% = 221,000 (IAS 23, para. 14). The costs capitalised do not exceed the borrowing costs incurred in the period, 195,000 (IAS 23, para. 14): the cap applies and the amount capitalised is 195,000, with no residual interest expense. Effect: assets increase by 195,000. Trap: forgetting the cap and capitalising 221,000. Rule to remember: After computing at the capitalisation rate, the amount capitalised is capped at the borrowing costs incurred.","es":""},"common_error":{"fr":"","en":"Capitalising the gross amount rate × expenditure without capping it.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"195,000","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"221,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount is the gross result 3,400,000 × 6.5%, before the cap: it exceeds the borrowing costs actually incurred of 195,000, which cannot be exceeded (IAS 23, para. 14). It must be brought down to 195,000. Rule to remember: After computing at the capitalisation rate, the amount capitalised is capped at the borrowing costs incurred.","es":""}},{"id":"C","text":{"fr":"","en":"26,000","es":""},"correct":false,"feedback":{"fr":"","en":"26,000 is the excess of the amount calculated over the costs incurred (221,000 − 195,000), that is the part that cannot be capitalised, not the amount to capitalise (IAS 23, para. 14). The amount that can be capitalised is the lower of the two, 195,000. Rule to remember: After computing at the capitalisation rate, the amount capitalised is capped at the borrowing costs incurred.","es":""}},{"id":"D","text":{"fr":"","en":"416,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount adds the amount calculated (221,000) and the costs incurred (195,000): but the cap uses the lower of the two, not their sum (IAS 23, para. 14). More than the 195,000 incurred cannot be capitalised. Rule to remember: After computing at the capitalisation rate, the amount capitalised is capped at the borrowing costs incurred.","es":""}}]},"scope":"CORE_STUDENT","reserve":true},{"key":"QST.IAS23.000039","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.CONDITIONS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000039","tested_point":"QST.IAS23.000039","difficulty":"BEGINNER","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"rule-conditions"},"references":["IAS 23 §17"],"exercise":{"prompt":{"fr":"","en":"When can the capitalisation of borrowing costs begin for a qualifying asset?","es":""},"explanation":{"fr":"","en":"Capitalisation begins when the entity incurs expenditure, incurs borrowing costs and undertakes the activities necessary to prepare the asset (IAS 23, para. 17). Approach: check the three conditions at the date considered. Trap: using the date of the loan, the year or the budget when one condition is missing. Rule to remember: Capitalisation begins when expenditure, borrowing costs and preparation activities are all present.","es":""},"common_error":{"fr":"","en":"Starting capitalisation at the date the loan is signed.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"As soon as the loan agreement is signed, even if expenditure on the asset has not yet begun.","es":""},"correct":false,"feedback":{"fr":"","en":"Signing the loan is not enough: capitalisation begins when expenditure, borrowing costs and preparation activities are all in place (IAS 23, para. 17). With no expenditure incurred, capitalisation is not open. Rule to remember: Capitalisation begins when expenditure, borrowing costs and preparation activities are all present.","es":""}},{"id":"B","text":{"fr":"","en":"On the first day of the financial year in which the asset is built, whatever the progress of the works.","es":""},"correct":false,"feedback":{"fr":"","en":"The start date of the financial year does not open capitalisation: it begins when expenditure, borrowing costs and preparation activities are in place (IAS 23, para. 17). The accounting calendar is not one of these conditions. Rule to remember: Capitalisation begins when expenditure, borrowing costs and preparation activities are all present.","es":""}},{"id":"C","text":{"fr":"","en":"When expenditure is incurred, borrowing costs are incurred and the activities to prepare the asset are in progress.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"After the budget is approved by management, even without any expenditure being committed.","es":""},"correct":false,"feedback":{"fr":"","en":"Approval of a budget is not one of the starting conditions: expenditure incurred, borrowing costs incurred and preparation activities in progress are needed (IAS 23, para. 17). An intention to spend does not replace the expenditure. Rule to remember: Capitalisation begins when expenditure, borrowing costs and preparation activities are all present.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000040","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.CONDITIONS","IAS23.CORE.CAPITALISE_OR_EXPENSE"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000040","tested_point":"QST.IAS23.000040","difficulty":"INTERMEDIATE","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"rule-principle"},"references":["IAS 23 §17","IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"Landry draws a loan of {principal} on 1 January at {annual_rate} a year. Expenditure, borrowing costs and preparation activities are all in place only {months_before_start} later, on 1 May. The year ends on 31 December and no funds are temporarily invested. Calculate the interest eligible for capitalisation for the year and the interest recognised as an expense.","es":""},"explanation":{"fr":"","en":"Annual interest is 3,600,000 × 5% = 180,000, that is 15,000 per month. Capitalisation begins on 1 May, when the three conditions are met (IAS 23, para. 17): 8 months × 15,000 = 120,000 is capitalised. The first 4 months, 60,000, are not capitalisable and are expensed (IAS 23, para. 8). Trap: capitalising the 180,000 from 1 January. Rule to remember: Borrowing costs after the commencement date are capitalisable; earlier ones are expensed.","es":""},"common_error":{"fr":"","en":"Capitalising the interest of the period before the commencement date.","es":""},"format":"CALCULATION","placeholders":[{"id":"principal","value":"3600000","unit":"EUR"},{"id":"annual_rate","value":"5","unit":"PERCENT"},{"id":"months_before_start","value":"4","unit":"MONTHS"}],"data":[{"label":{"fr":"","en":"Loan drawn on 1 January","es":""},"value":"3600000","unit":"EUR"},{"label":{"fr":"","en":"Annual interest rate","es":""},"value":"5","unit":"PERCENT"},{"label":{"fr":"","en":"Time before capitalisation begins","es":""},"value":"4","unit":"MONTHS"}],"steps":[{"id":"CAPITALISED_INTEREST","label":{"fr":"","en":"Interest eligible for capitalisation","es":""},"answer":120000,"tolerance":0,"unit":"EUR"},{"id":"EXPENSED_INTEREST","label":{"fr":"","en":"Interest expensed","es":""},"answer":60000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000042","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.EXPENDITURE"],"dimension":"CALCULATION","context":"V1_VG.IAS23.000003","tested_point":"VG.IAS23.000003","difficulty":"INTERMEDIATE","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"rule-expenditure"},"references":["IAS 23 §18"],"exercise":{"prompt":{"fr":"","en":"Delorme is building a workshop. It paid {cash_paid} in cash, transferred assets worth {other_assets_transferred} to the contractors, assumed interest-bearing liabilities of {interest_bearing_liabilities} and received progress payments of {progress_payments_received} in respect of the workshop. Calculate the expenditure eligible for the capitalisation of borrowing costs.","es":""},"explanation":{"fr":"","en":"Eligible expenditure comprises cash payments, transfers of other assets and interest-bearing liabilities assumed, net of progress payments received (IAS 23, para. 18). Calculation: 900,000 + 100,000 + 200,000 − 150,000 = 1,050,000. Trap: forgetting to deduct the progress payments, which would give 1,200,000. Rule to remember: Eligible expenditure = cash paid + assets transferred + interest-bearing liabilities − progress payments and grants received.","es":""},"common_error":{"fr":"","en":"Not deducting the progress payments received from eligible expenditure.","es":""},"format":"CALCULATION","placeholders":[{"id":"cash_paid","value":"900000","unit":"EUR"},{"id":"other_assets_transferred","value":"100000","unit":"EUR"},{"id":"interest_bearing_liabilities","value":"200000","unit":"EUR"},{"id":"progress_payments_received","value":"150000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"Cash paid","es":""},"value":"900000","unit":"EUR"},{"label":{"fr":"","en":"Assets transferred to contractors","es":""},"value":"100000","unit":"EUR"},{"label":{"fr":"","en":"Interest-bearing liabilities assumed","es":""},"value":"200000","unit":"EUR"},{"label":{"fr":"","en":"Progress payments received","es":""},"value":"150000","unit":"EUR"}],"steps":[{"id":"ELIGIBLE_EXPENDITURE","label":{"fr":"","en":"Eligible expenditure","es":""},"answer":1050000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"ELIGIBLE_EXPENDITURE","meaning":{"fr":"","en":"Eligible expenditure","es":""},"expression":"a + b + c - d","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cash paid","es":""},"value":900000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Assets transferred to contractors","es":""},"value":100000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Interest-bearing liabilities assumed","es":""},"value":200000,"unit":"EUR"},{"symbol":"d","meaning":{"fr":"","en":"Progress payments received","es":""},"value":150000,"unit":"EUR"}],"result":1050000,"unit":"EUR"}],"rationale":{"fr":"","en":"Eligible expenditure = cash paid + assets transferred + interest-bearing liabilities − progress payments and grants received.","es":""},"references":["REF.IAS23.18"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000043","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.EXPENDITURE","IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000043","tested_point":"QST.IAS23.000043","difficulty":"ADVANCED","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-rate"},"references":["IAS 23 §18","IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"Maury is building a plant financed by its general borrowings. Eligible expenditure for the year: {expenditure_1} incurred {months_1} ago; {expenditure_2} incurred {months_2} ago; {expenditure_3} incurred {months_3} ago. The capitalisation rate is {capitalisation_rate}. Calculate the weighted average expenditure, then the borrowing costs eligible for capitalisation (cap not reached, case data).","es":""},"explanation":{"fr":"","en":"Each expenditure is weighted by the fraction of the period elapsed since it was incurred (IAS 23, para. 18), and the rate is then applied to the weighted average (IAS 23, para. 14). Weighted expenditure = 1,200,000 × 12/12 + 800,000 × 9/12 + 600,000 × 3/12 = 1,200,000 + 600,000 + 150,000 = 1,950,000. Costs eligible = 1,950,000 × 6% = 117,000. Trap: adding the expenditure without weighting (2,600,000), which gives 156,000. Rule to remember: Expenditure is weighted by the time elapsed since it was incurred before applying the capitalisation rate.","es":""},"common_error":{"fr":"","en":"Applying the rate to total expenditure without weighting it by time.","es":""},"format":"CALCULATION","placeholders":[{"id":"expenditure_1","value":"1200000","unit":"EUR"},{"id":"months_1","value":"12","unit":"MONTHS"},{"id":"expenditure_2","value":"800000","unit":"EUR"},{"id":"months_2","value":"9","unit":"MONTHS"},{"id":"expenditure_3","value":"600000","unit":"EUR"},{"id":"months_3","value":"3","unit":"MONTHS"},{"id":"capitalisation_rate","value":"6","unit":"PERCENT"}],"data":[{"label":{"fr":"","en":"First expenditure","es":""},"value":"1200000","unit":"EUR"},{"label":{"fr":"","en":"Age of the first expenditure","es":""},"value":"12","unit":"MONTHS"},{"label":{"fr":"","en":"Second expenditure","es":""},"value":"800000","unit":"EUR"},{"label":{"fr":"","en":"Age of the second expenditure","es":""},"value":"9","unit":"MONTHS"},{"label":{"fr":"","en":"Third expenditure","es":""},"value":"600000","unit":"EUR"},{"label":{"fr":"","en":"Age of the third expenditure","es":""},"value":"3","unit":"MONTHS"},{"label":{"fr":"","en":"Capitalisation rate","es":""},"value":"6","unit":"PERCENT"}],"steps":[{"id":"WEIGHTED_EXPENDITURE","label":{"fr":"","en":"Weighted average expenditure","es":""},"answer":1950000,"tolerance":0,"unit":"EUR"},{"id":"ELIGIBLE_COSTS","label":{"fr":"","en":"Costs eligible for capitalisation","es":""},"answer":117000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"WEIGHTED_EXPENDITURE","meaning":{"fr":"","en":"Weighted average expenditure","es":""},"expression":"a * b / b + c * d / b + e * f / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"First expenditure","es":""},"value":1200000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Age of the first expenditure","es":""},"value":12,"unit":"MONTHS"},{"symbol":"c","meaning":{"fr":"","en":"Second expenditure","es":""},"value":800000,"unit":"EUR"},{"symbol":"d","meaning":{"fr":"","en":"Age of the second expenditure","es":""},"value":9,"unit":"MONTHS"},{"symbol":"e","meaning":{"fr":"","en":"Third expenditure","es":""},"value":600000,"unit":"EUR"},{"symbol":"f","meaning":{"fr":"","en":"Age of the third expenditure","es":""},"value":3,"unit":"MONTHS"}],"result":1950000,"unit":"EUR"},{"step":"ELIGIBLE_COSTS","meaning":{"fr":"","en":"Costs eligible for capitalisation","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Weighted average expenditure","es":""},"value":1950000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Capitalisation rate","es":""},"value":6,"unit":"PERCENT"}],"result":117000,"unit":"EUR"}],"rationale":{"fr":"","en":"Expenditure is weighted by the time elapsed since it was incurred before applying the capitalisation rate.","es":""},"references":["REF.IAS23.18","REF.IAS23.14"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000045","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.EXPENDITURE"],"dimension":"APPLICATION","context":"V1_VG.IAS23.000003","tested_point":"VG.IAS23.000003","difficulty":"EXPERT","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":140,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"rule-expenditure"},"references":["IAS 23 §18"],"exercise":{"prompt":{"fr":"","en":"Perret is building a data centre. At the calculation date, it has paid 2,000,000 in cash, transferred assets worth 300,000 to the contractors, assumed interest-bearing liabilities of 500,000, received progress payments of 400,000 and received an asset grant of 600,000 (case data). What is the expenditure eligible for the capitalisation of borrowing costs?","es":""},"explanation":{"fr":"","en":"Eligible expenditure consists of cash payments, transfers of other assets and interest-bearing liabilities, net of progress payments and grants received in respect of the asset (IAS 23, para. 18). Calculation: 2,000,000 + 300,000 + 500,000 = 2,800,000; less 400,000 and 600,000 = 1,800,000. This base is then used to compute the borrowing costs eligible and affects the cost of the asset presented. Trap: deducting only one of the two items. Rule to remember: Eligible expenditure deducts both progress payments and grants received in respect of the asset.","es":""},"common_error":{"fr":"","en":"Deducting only the progress payments or only the grant.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"2,200,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount (2,800,000 − 600,000) deducts the grant but forgets the progress payments of 400,000: eligible expenditure is net of progress payments as well as grants received (IAS 23, para. 18). The correct result is 1,800,000. Rule to remember: Eligible expenditure deducts both progress payments and grants received in respect of the asset.","es":""}},{"id":"B","text":{"fr":"","en":"2,800,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount adds the outflows without deducting anything: it ignores the progress payments received and the grant, which eligible expenditure deducts (IAS 23, para. 18). 2,000,000 + 300,000 + 500,000 gives a gross amount, not an eligible amount. Rule to remember: Eligible expenditure deducts both progress payments and grants received in respect of the asset.","es":""}},{"id":"C","text":{"fr":"","en":"2,400,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount (2,800,000 − 400,000) deducts the progress payments but forgets the asset grant of 600,000, which also reduces eligible expenditure (IAS 23, para. 18). Both deductions apply. Rule to remember: Eligible expenditure deducts both progress payments and grants received in respect of the asset.","es":""}},{"id":"D","text":{"fr":"","en":"1,800,000","es":""},"correct":true}]},"scope":"CORE_STUDENT","reserve":true},{"key":"QST.IAS23.000046","standard_id":"IAS23","concept_ids":["IAS23.COMMENCEMENT.LAND_WITHOUT_DEVELOPMENT"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000046","tested_point":"QST.IAS23.000046","difficulty":"INTERMEDIATE","source":"V1","format":"TRUE_FALSE","estimated_time_s":40,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000007","section_id":"rule-land"},"references":["IAS 23 §19"],"exercise":{"prompt":{"fr":"","en":"Land bought and left as it is, with no development activity under way, does not open the capitalisation of the interest on the loan that financed it.","es":""},"explanation":{"fr":"","en":"Land held waiting, with no development activity, does not give rise to capitalisation of borrowing costs (IAS 23, para. 19): one of the starting conditions, activities to prepare the asset, is not met (IAS 23, para. 17). Approach: look for whether development activities are under way. Trap: capitalising the interest on land simply because it was financed by a loan. Rule to remember: With no development activity under way, land held waiting does not open capitalisation of borrowing costs.","es":""},"common_error":{"fr":"","en":"Capitalising the interest on land simply because it is loan-financed.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000047","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXTENDED_PERIODS"],"dimension":"RULE_KNOWLEDGE","context":"V1_VG.IAS23.000004","tested_point":"VG.IAS23.000004","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"rule-suspension"},"references":["IAS 23 §20"],"exercise":{"prompt":{"fr":"","en":"Work on a warehouse is interrupted for several months: active development stops for lack of funding of the contractor, while the entity's loan continues to run. What happens to the capitalisation of borrowing costs during this extended interruption?","es":""},"explanation":{"fr":"","en":"Capitalisation is suspended during extended periods of interrupted active development (IAS 23, para. 20). Here, development is stopped for several months: borrowing costs for that period are not capitalised. Approach: identify whether active development is really interrupted and for how long. Trap: believing that the loan continuing keeps capitalisation going. Rule to remember: Capitalisation is suspended during an extended interruption of active development.","es":""},"common_error":{"fr":"","en":"Continuing to capitalise interest during an extended stoppage of the works.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It continues as normal, because the loan remains outstanding and continues to finance the asset under construction.","es":""},"correct":false,"feedback":{"fr":"","en":"The loan remaining in place is not enough: capitalisation is suspended during extended periods of interrupted active development (IAS 23, para. 20). Interest accruing during the stoppage is therefore not capitalised. Rule to remember: Capitalisation is suspended during an extended interruption of active development.","es":""}},{"id":"B","text":{"fr":"","en":"It continues, but only at the lowest interest rate among the entity's borrowings during the stoppage.","es":""},"correct":false,"feedback":{"fr":"","en":"The standard provides no reduced rate during the stoppage: it suspends capitalisation during extended periods of interrupted active development (IAS 23, para. 20). There is no half-measure at a lower rate. Rule to remember: Capitalisation is suspended during an extended interruption of active development.","es":""}},{"id":"C","text":{"fr":"","en":"It is suspended during the extended interruption of active development.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"It is suspended, but only if the entity has first obtained the written agreement of its lender.","es":""},"correct":false,"feedback":{"fr":"","en":"Suspension does not depend on the lender's agreement: it results from the extended interruption of active development (IAS 23, para. 20). A contractual formality is not part of the condition. Rule to remember: Capitalisation is suspended during an extended interruption of active development.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000048","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXTENDED_PERIODS"],"dimension":"CALCULATION","context":"V1_VG.IAS23.000004","tested_point":"VG.IAS23.000004","difficulty":"ADVANCED","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"rule-suspension"},"references":["IAS 23 §20"],"exercise":{"prompt":{"fr":"","en":"A specific loan of {principal} at {annual_rate} a year finances a plant all year. Active development is interrupted for {suspended_months} (extended interruption, case data); for the rest of the year, {total_months} in total, capitalisation is open. No funds are temporarily invested. Calculate the interest capitalised and the interest expensed for the year.","es":""},"explanation":{"fr":"","en":"Capitalisation is suspended during the extended interruption of active development (IAS 23, para. 20). Annual interest: 4,800,000 × 6% = 288,000, that is 24,000 per month. Capitalised: (12 − 4) months × 24,000 = 192,000; the 4 months suspended, 96,000, are expensed. Trap: capitalising the 288,000 for the whole year. Rule to remember: Interest for the months of extended suspension is not capitalised; those of the months in which capitalisation is open are.","es":""},"common_error":{"fr":"","en":"Capitalising the interest of the whole year without removing the suspension period.","es":""},"format":"CALCULATION","placeholders":[{"id":"principal","value":"4800000","unit":"EUR"},{"id":"annual_rate","value":"6","unit":"PERCENT"},{"id":"suspended_months","value":"4","unit":"MONTHS"},{"id":"total_months","value":"12","unit":"MONTHS"}],"data":[{"label":{"fr":"","en":"Specific loan","es":""},"value":"4800000","unit":"EUR"},{"label":{"fr":"","en":"Annual interest rate","es":""},"value":"6","unit":"PERCENT"},{"label":{"fr":"","en":"Length of the extended interruption","es":""},"value":"4","unit":"MONTHS"},{"label":{"fr":"","en":"Length of the year","es":""},"value":"12","unit":"MONTHS"}],"steps":[{"id":"CAPITALISED_INTEREST","label":{"fr":"","en":"Interest capitalised","es":""},"answer":192000,"tolerance":0,"unit":"EUR"},{"id":"EXPENSED_INTEREST","label":{"fr":"","en":"Interest expensed","es":""},"answer":96000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT","reserve":true},{"key":"QST.IAS23.000050","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXCEPTIONS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000050","tested_point":"QST.IAS23.000050","difficulty":"INTERMEDIATE","source":"V1","format":"TRUE_FALSE","estimated_time_s":40,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"rule-exceptions"},"references":["IAS 23 §21"],"exercise":{"prompt":{"fr":"","en":"While the entity carries out substantial technical and administrative work on the project, capitalisation of borrowing costs is suspended.","es":""},"explanation":{"fr":"","en":"Substantial technical and administrative work does not cause capitalisation to be suspended (IAS 23, para. 21): it is part of the activities to prepare the asset. Approach: ask whether the activity is a stoppage of development or a preparation phase. Trap: confusing the absence of work on site with an interruption of development. Rule to remember: Substantial technical and administrative work does not suspend capitalisation.","es":""},"common_error":{"fr":"","en":"Suspending capitalisation as soon as no worker is present on site.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000051","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXCEPTIONS"],"dimension":"APPLICATION","context":"V1_QST.IAS23.000051","tested_point":"QST.IAS23.000051","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":140,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"rule-exceptions"},"references":["IAS 23 §21"],"exercise":{"prompt":{"fr":"","en":"Work on a bridge is slowed for 3 weeks by a river flood, a temporary event inherent in this type of project (case data). Work then resumes normally. What is the effect on the capitalisation of borrowing costs?","es":""},"explanation":{"fr":"","en":"A temporary delay inherent in the process of preparing the asset does not suspend capitalisation (IAS 23, para. 21). The 3-week flood is, according to the case, such a delay: capitalisation continues. Approach: distinguish an extended interruption of active development from a temporary delay inherent in the process. Trap: applying a duration threshold that the standard does not set. Rule to remember: A temporary delay inherent in the process of preparing the asset does not suspend capitalisation.","es":""},"common_error":{"fr":"","en":"Applying a duration threshold set by the standard to decide on a suspension.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Capitalisation is suspended for the 3 weeks, because active development is slowed.","es":""},"correct":false,"feedback":{"fr":"","en":"A temporary slowdown inherent in the process is not an extended interruption: capitalisation is not suspended in this case (IAS 23, para. 21). The borrowing costs of those weeks remain capitalisable. Rule to remember: A temporary delay inherent in the process of preparing the asset does not suspend capitalisation.","es":""}},{"id":"B","text":{"fr":"","en":"Capitalisation continues: a temporary delay inherent in the preparation process does not suspend it.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Capitalisation is suspended as soon as the delay exceeds one week, a threshold the standard sets for construction projects.","es":""},"correct":false,"feedback":{"fr":"","en":"The standard sets no one-week threshold: it does not suspend capitalisation for a temporary delay inherent in the process (IAS 23, para. 21). A quantified threshold presented as a rule would be invented. Rule to remember: A temporary delay inherent in the process of preparing the asset does not suspend capitalisation.","es":""}},{"id":"D","text":{"fr":"","en":"Capitalisation ceases permanently, because the delay calls the completion of the asset into question.","es":""},"correct":false,"feedback":{"fr":"","en":"Capitalisation ceases when substantially all preparation activities are complete, not because of a temporary delay; and that delay does not even suspend capitalisation (IAS 23, para. 21). Work resumes and capitalisation continues. Rule to remember: A temporary delay inherent in the process of preparing the asset does not suspend capitalisation.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000052","standard_id":"IAS23","concept_ids":["IAS23.SUSPENSION.EXCEPTIONS","IAS23.SUSPENSION.EXTENDED_PERIODS"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000052","tested_point":"QST.IAS23.000052","difficulty":"EXPERT","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000008","section_id":"rule-suspension"},"references":["IAS 23 §21","IAS 23 §20"],"exercise":{"prompt":{"fr":"","en":"A specific loan of {principal} at {annual_rate} a year finances a project whose length, from the start of capitalisation to completion, is {project_months}. During the project: a temporary delay of {temporary_delay} due to weather, inherent in the process (case data), and an extended interruption of {extended_interruption} for lack of funding of the contractor. No funds are temporarily invested. Calculate the capitalisation period and the borrowing costs eligible for capitalisation.","es":""},"explanation":{"fr":"","en":"The extended interruption suspends capitalisation (IAS 23, para. 20); the temporary delay inherent in the process does not (IAS 23, para. 21). Capitalisation period = 14 − 4 = 10 months (the 2 months of delay stay in the period). Monthly interest: 5,400,000 × 4% / 12 = 18,000; costs eligible = 18,000 × 10 = 180,000. Trap: also removing the temporary delay (14 − 6 = 8 months, giving 144,000). Rule to remember: The extended interruption is removed from the period, not the temporary delay inherent in the process.","es":""},"common_error":{"fr":"","en":"Removing the temporary delay from the capitalisation period.","es":""},"format":"CALCULATION","placeholders":[{"id":"principal","value":"5400000","unit":"EUR"},{"id":"annual_rate","value":"4","unit":"PERCENT"},{"id":"project_months","value":"14","unit":"MONTHS"},{"id":"temporary_delay","value":"2","unit":"MONTHS"},{"id":"extended_interruption","value":"4","unit":"MONTHS"}],"data":[{"label":{"fr":"","en":"Specific loan","es":""},"value":"5400000","unit":"EUR"},{"label":{"fr":"","en":"Annual interest rate","es":""},"value":"4","unit":"PERCENT"},{"label":{"fr":"","en":"Length of the project","es":""},"value":"14","unit":"MONTHS"},{"label":{"fr":"","en":"Temporary delay","es":""},"value":"2","unit":"MONTHS"},{"label":{"fr":"","en":"Extended interruption","es":""},"value":"4","unit":"MONTHS"}],"steps":[{"id":"MONTHS_CAPITALISED","label":{"fr":"","en":"Capitalisation period","es":""},"answer":10,"tolerance":0,"unit":"MONTHS"},{"id":"CAPITALISED_COSTS","label":{"fr":"","en":"Costs eligible for capitalisation","es":""},"answer":180000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"MONTHS_CAPITALISED","meaning":{"fr":"","en":"Capitalisation period","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Length of the project","es":""},"value":14,"unit":"MONTHS"},{"symbol":"b","meaning":{"fr":"","en":"Extended interruption","es":""},"value":4,"unit":"MONTHS"}],"result":10,"unit":"MONTHS"},{"step":"CAPITALISED_COSTS","meaning":{"fr":"","en":"Costs eligible for capitalisation","es":""},"expression":"(a * b / 12) * c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Specific loan","es":""},"value":5400000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Annual interest rate","es":""},"value":4,"unit":"PERCENT"},{"symbol":"c","meaning":{"fr":"","en":"Capitalisation period","es":""},"value":10,"unit":"MONTHS"}],"result":180000,"unit":"EUR"}],"rationale":{"fr":"","en":"The extended interruption is removed from the period, not the temporary delay inherent in the process.","es":""},"references":["REF.IAS23.21","REF.IAS23.20"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000053","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.SUBSTANTIALLY_ALL"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000053","tested_point":"QST.IAS23.000053","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000009","section_id":"rule-cessation"},"references":["IAS 23 §22"],"exercise":{"prompt":{"fr":"","en":"When does capitalisation of borrowing costs cease for a qualifying asset?","es":""},"explanation":{"fr":"","en":"Capitalisation ceases when substantially all the activities necessary to prepare the asset for its intended use or sale are complete (IAS 23, para. 22). Approach: locate the moment when the asset is substantially ready. Trap: using a payment, repayment or year-end date unrelated to progress. Rule to remember: Capitalisation ceases when substantially all the activities to prepare the asset are complete.","es":""},"common_error":{"fr":"","en":"Stopping capitalisation at a payment or year-end date unrelated to progress.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"When substantially all the activities necessary to prepare the asset for its intended use or sale are complete.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"On the date of the last payment made to the contractor, even if preparation activities remain to be carried out.","es":""},"correct":false,"feedback":{"fr":"","en":"The date of the last payment is not the test: capitalisation ceases when substantially all preparation activities are complete (IAS 23, para. 22). Activities still to be carried out extend capitalisation. Rule to remember: Capitalisation ceases when substantially all the activities to prepare the asset are complete.","es":""}},{"id":"C","text":{"fr":"","en":"On the date the loan that financed the asset is fully repaid, whatever the state of the works.","es":""},"correct":false,"feedback":{"fr":"","en":"Repayment of the loan has no link with the state of preparation of the asset: capitalisation ceases when substantially all preparation activities are complete (IAS 23, para. 22). A loan may be repaid before or after that date. Rule to remember: Capitalisation ceases when substantially all the activities to prepare the asset are complete.","es":""}},{"id":"D","text":{"fr":"","en":"At the end of the financial year following the start of the works, even if the asset is not ready.","es":""},"correct":false,"feedback":{"fr":"","en":"An accounting deadline does not end capitalisation: it ceases when substantially all the activities to prepare the asset are complete (IAS 23, para. 22). The state of progress takes precedence over the calendar. Rule to remember: Capitalisation ceases when substantially all the activities to prepare the asset are complete.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000055","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.SUBSTANTIALLY_ALL","IAS23.CORE.CAPITALISE_OR_EXPENSE"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000055","tested_point":"QST.IAS23.000055","difficulty":"EXPERT","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000001","section_id":"rule-principle"},"references":["IAS 23 §22","IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"Marsac's plant, whose construction expenditure amounts to {construction_expenditure}, is financed in part by a specific loan of {principal} at {annual_rate} a year, drawn on 1 January. Substantially all the preparation activities are complete on 31 October. The year ends on 31 December: {months_until_completion} of capitalisation, then {months_after_completion} after completion. No funds are temporarily invested. Calculate the borrowing costs capitalised, those expensed, then the cost of the asset.","es":""},"explanation":{"fr":"","en":"Capitalisation ceases when substantially all the preparation activities are complete (IAS 23, para. 22); later interest is expensed (IAS 23, para. 8). Monthly interest: 6,000,000 × 6% / 12 = 30,000. Capitalised: 10 × 30,000 = 300,000; expensed: 2 × 30,000 = 60,000. Cost of the asset = 12,000,000 + 300,000 = 12,300,000. Effect: the asset is presented at 12,300,000 and profit bears 60,000. Trap: continuing to capitalise after 31 October (360,000). Rule to remember: Interest after substantial completion is expensed; the cost of the asset includes only that before.","es":""},"common_error":{"fr":"","en":"Continuing to capitalise interest after the date of substantial completion.","es":""},"format":"CALCULATION","placeholders":[{"id":"construction_expenditure","value":"12000000","unit":"EUR"},{"id":"principal","value":"6000000","unit":"EUR"},{"id":"annual_rate","value":"6","unit":"PERCENT"},{"id":"months_until_completion","value":"10","unit":"MONTHS"},{"id":"months_after_completion","value":"2","unit":"MONTHS"}],"data":[{"label":{"fr":"","en":"Construction expenditure","es":""},"value":"12000000","unit":"EUR"},{"label":{"fr":"","en":"Specific loan","es":""},"value":"6000000","unit":"EUR"},{"label":{"fr":"","en":"Annual interest rate","es":""},"value":"6","unit":"PERCENT"},{"label":{"fr":"","en":"Months until completion","es":""},"value":"10","unit":"MONTHS"},{"label":{"fr":"","en":"Months after completion","es":""},"value":"2","unit":"MONTHS"}],"steps":[{"id":"CAPITALISED_INTEREST","label":{"fr":"","en":"Interest capitalised","es":""},"answer":300000,"tolerance":0,"unit":"EUR"},{"id":"EXPENSED_INTEREST","label":{"fr":"","en":"Interest expensed","es":""},"answer":60000,"tolerance":0,"unit":"EUR"},{"id":"ASSET_COST","label":{"fr":"","en":"Cost of the asset","es":""},"answer":12300000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"CAPITALISED_INTEREST","meaning":{"fr":"","en":"Interest capitalised","es":""},"expression":"a * (b * c / 12)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Months until completion","es":""},"value":10,"unit":"MONTHS"},{"symbol":"b","meaning":{"fr":"","en":"Specific loan","es":""},"value":6000000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Annual interest rate","es":""},"value":6,"unit":"PERCENT"}],"result":300000,"unit":"EUR"},{"step":"EXPENSED_INTEREST","meaning":{"fr":"","en":"Interest expensed","es":""},"expression":"a * (b * c / 12)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Months after completion","es":""},"value":2,"unit":"MONTHS"},{"symbol":"b","meaning":{"fr":"","en":"Specific loan","es":""},"value":6000000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Annual interest rate","es":""},"value":6,"unit":"PERCENT"}],"result":60000,"unit":"EUR"},{"step":"ASSET_COST","meaning":{"fr":"","en":"Cost of the asset","es":""},"expression":"a + b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Construction expenditure","es":""},"value":12000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Interest capitalised","es":""},"value":300000,"unit":"EUR"}],"result":12300000,"unit":"EUR"}],"rationale":{"fr":"","en":"Interest after substantial completion is expensed; the cost of the asset includes only that before.","es":""},"references":["REF.IAS23.22","REF.IAS23.8"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000056","standard_id":"IAS23","concept_ids":["IAS23.CESSATION.PARTS_COMPLETED"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000056","tested_point":"QST.IAS23.000056","difficulty":"ADVANCED","source":"V1","format":"TRUE_FALSE","estimated_time_s":40,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000009","section_id":"rule-parts"},"references":["IAS 23 §24"],"exercise":{"prompt":{"fr":"","en":"When construction continues on other parts of an asset, capitalisation ceases for a part that is already complete and can be used separately.","es":""},"explanation":{"fr":"","en":"For an asset completed in parts, capitalisation ceases for the part that is complete and can be used separately, even if construction continues elsewhere (IAS 23, para. 24). Approach: ask whether the completed part can be used on its own. Trap: waiting for the whole to be completed before stopping capitalisation for every part. Rule to remember: A completed part that can be used separately stops being capitalised, even if the rest of the asset is under construction.","es":""},"common_error":{"fr":"","en":"Capitalising the borrowing costs of a part already in service until the whole asset is complete.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000057","standard_id":"IAS23","concept_ids":["IAS23.DISCLOSURE.AMOUNT"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000057","tested_point":"QST.IAS23.000057","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000010","section_id":"rule-disclosure"},"references":["IAS 23 §26"],"exercise":{"prompt":{"fr":"","en":"What information does the standard require to be disclosed about capitalised borrowing costs?","es":""},"explanation":{"fr":"","en":"The entity discloses the amount of borrowing costs capitalised during the period and, where general borrowings are involved, the capitalisation rate used (IAS 23, para. 26). Approach: take what was capitalised during the period. Trap: giving the total interest paid or the interest expense alone. Rule to remember: The amount of borrowing costs capitalised in the period and the capitalisation rate used are disclosed.","es":""},"common_error":{"fr":"","en":"Disclosing total interest paid instead of the amount capitalised.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The cumulative amount of interest paid by the entity since its creation, whatever its destination.","es":""},"correct":false,"feedback":{"fr":"","en":"The information required concerns the borrowing costs capitalised during the period, not all interest paid since the entity was created (IAS 23, para. 26). A historical cumulative figure is not what the standard asks for. Rule to remember: The amount of borrowing costs capitalised in the period and the capitalisation rate used are disclosed.","es":""}},{"id":"B","text":{"fr":"","en":"The list of lending institutions and the detailed terms of each credit facility.","es":""},"correct":false,"feedback":{"fr":"","en":"The standard requires the amount of borrowing costs capitalised and the capitalisation rate used, not the list of lenders or the terms of each credit facility (IAS 23, para. 26). That detail belongs to other disclosures. Rule to remember: The amount of borrowing costs capitalised in the period and the capitalisation rate used are disclosed.","es":""}},{"id":"C","text":{"fr":"","en":"The amount of borrowing costs recognised as an expense, excluding those capitalised.","es":""},"correct":false,"feedback":{"fr":"","en":"This is the reverse of what the standard asks: the information concerns the amount capitalised during the period (IAS 23, para. 26). Interest expense already appears in profit or loss. Rule to remember: The amount of borrowing costs capitalised in the period and the capitalisation rate used are disclosed.","es":""}},{"id":"D","text":{"fr":"","en":"The amount of borrowing costs capitalised in the cost of assets during the period.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000058","standard_id":"IAS23","concept_ids":["IAS23.DISCLOSURE.CAPITALISATION_RATE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000058","tested_point":"QST.IAS23.000058","difficulty":"INTERMEDIATE","source":"V1","format":"TRUE_FALSE","estimated_time_s":40,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000010","section_id":"rule-disclosure"},"references":["IAS 23 §26"],"exercise":{"prompt":{"fr":"","en":"An entity that determines the costs eligible for capitalisation using a capitalisation rate does not have to disclose that rate.","es":""},"explanation":{"fr":"","en":"The disclosures include the amount of borrowing costs capitalised during the period and the capitalisation rate used (IAS 23, para. 26). Approach: reread the list of information required. Trap: retaining only the amount capitalised and forgetting the rate used to obtain it. Rule to remember: The capitalisation rate used is part of the disclosures, together with the amount capitalised.","es":""},"common_error":{"fr":"","en":"Omitting the capitalisation rate from the information disclosed.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000059","standard_id":"IAS23","concept_ids":["IAS23.DISCLOSURE.CAPITALISATION_RATE","IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000059","tested_point":"QST.IAS23.000059","difficulty":"ADVANCED","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-rate"},"references":["IAS 23 §26","IAS 23 §14"],"exercise":{"prompt":{"fr":"","en":"To prepare its notes, Rivoire has the following data on its general borrowings: borrowing costs for the year {total_costs}; weighted average amount outstanding {weighted_borrowings}. The weighted average expenditure on the qualifying asset is {weighted_expenditure} (cap not reached, case data). Calculate the capitalisation rate to disclose and the amount of borrowing costs capitalised to disclose.","es":""},"explanation":{"fr":"","en":"The capitalisation rate is the weighted average of the borrowing costs of the period (IAS 23, para. 14): 270,000 / 4,500,000 = 6%. The amount capitalised is 2,000,000 × 6% = 120,000. These two items, the amount capitalised and the rate used, are to be disclosed (IAS 23, para. 26). Trap: reporting total borrowing costs (270,000) as the amount capitalised. Rule to remember: The amount capitalised (weighted expenditure × rate) and the capitalisation rate used are disclosed.","es":""},"common_error":{"fr":"","en":"Confusing total borrowing costs with the amount actually capitalised.","es":""},"format":"CALCULATION","placeholders":[{"id":"total_costs","value":"270000","unit":"EUR"},{"id":"weighted_borrowings","value":"4500000","unit":"EUR"},{"id":"weighted_expenditure","value":"2000000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"Borrowing costs of general borrowings","es":""},"value":"270000","unit":"EUR"},{"label":{"fr":"","en":"Weighted average amount outstanding","es":""},"value":"4500000","unit":"EUR"},{"label":{"fr":"","en":"Weighted average expenditure on the asset","es":""},"value":"2000000","unit":"EUR"}],"steps":[{"id":"DISCLOSED_RATE","label":{"fr":"","en":"Capitalisation rate to disclose","es":""},"answer":6,"tolerance":0,"unit":"PERCENT"},{"id":"DISCLOSED_AMOUNT","label":{"fr":"","en":"Amount capitalised to disclose","es":""},"answer":120000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"DISCLOSED_RATE","meaning":{"fr":"","en":"Capitalisation rate to disclose","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Borrowing costs of general borrowings","es":""},"value":270000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Weighted average amount outstanding","es":""},"value":4500000,"unit":"EUR"}],"result":6,"unit":"PERCENT","rationale":{"fr":"","en":"The capitalisation rate is the weighted average of the borrowing costs of the period (IAS 23, para. 14): 270,000 / 4,500,000 = 6%.","es":""}},{"step":"DISCLOSED_AMOUNT","meaning":{"fr":"","en":"Amount capitalised to disclose","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Weighted average expenditure on the asset","es":""},"value":2000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Capitalisation rate to disclose","es":""},"value":6,"unit":"PERCENT"}],"result":120000,"unit":"EUR"}],"rationale":{"fr":"","en":"The amount capitalised (weighted expenditure × rate) and the capitalisation rate used are disclosed.","es":""},"references":["REF.IAS23.26","REF.IAS23.14"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000060","standard_id":"IAS23","concept_ids":["IAS23.TRANSITION.ORIGINAL","IAS23.SCOPE.GENERAL"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000060","tested_point":"QST.IAS23.000060","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000002","section_id":"rule-scope"},"references":["IAS 23 §27","IAS 23 §28","IAS 23 §29","IAS 23 §2","IAS 23 §3"],"exercise":{"prompt":{"fr":"","en":"The original transition and effective date provisions of the standard (2007 revision) accompanied a substantive change in the treatment of borrowing costs. Which one?","es":""},"explanation":{"fr":"","en":"The standard in force is the one that removed the option to expense the borrowing costs of a qualifying asset (IAS 23, para. 8); its original transition and effective date provisions date from that 2007 revision (IAS 23, paras. 27 to 29). Approach: link the transition provisions to the change they accompany. Trap: confusing this revision with a change of scope or of rate. Rule to remember: The 2007 revision removed the option to expense the borrowing costs of a qualifying asset.","es":""},"common_error":{"fr":"","en":"Confusing the original revision with an extension of the scope of the standard.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The introduction of an option allowing all the borrowing costs of a qualifying asset to be expensed.","es":""},"correct":false,"feedback":{"fr":"","en":"It is the reverse: the standard in force results from the removal of the option to expense, not from its introduction (IAS 23, para. 8). The original transition provisions accompanied that removal (IAS 23, paras. 27 to 29). Rule to remember: The 2007 revision removed the option to expense the borrowing costs of a qualifying asset.","es":""}},{"id":"B","text":{"fr":"","en":"The removal of the option to expense borrowing costs directly attributable to a qualifying asset.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The extension of the scope of the standard to assets measured at fair value.","es":""},"correct":false,"feedback":{"fr":"","en":"An entity is not required to apply the standard to a qualifying asset measured at fair value (IAS 23, para. 4): the substantive change of 2007 concerns the option to expense (IAS 23, para. 8). The original transition provisions do not concern that scope. Rule to remember: The 2007 revision removed the option to expense the borrowing costs of a qualifying asset.","es":""}},{"id":"D","text":{"fr":"","en":"The creation of a single capitalisation rate for all borrowings, specific and general.","es":""},"correct":false,"feedback":{"fr":"","en":"The standard keeps two approaches: actual costs for a specific borrowing and a capitalisation rate for general borrowings (IAS 23, paras. 12 and 14). The 2007 change concerns the option to expense (IAS 23, para. 8). Rule to remember: The 2007 revision removed the option to expense the borrowing costs of a qualifying asset.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000061","standard_id":"IAS23","concept_ids":["IAS23.TRANSITION.AIP_2015_2017","IAS23.GENERAL.CAPITALISATION_RATE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000061","tested_point":"QST.IAS23.000061","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000006","section_id":"rule-rate"},"references":["IAS 23 §14","IAS 23 §28A","IAS 23 §29D"],"exercise":{"prompt":{"fr":"","en":"What is the scope of the 2015-2017 annual improvements on the calculation of the capitalisation rate, and how do they apply?","es":""},"explanation":{"fr":"","en":"Since the 2015-2017 improvements, a specific borrowing still outstanding after its asset is complete joins general borrowings for the calculation of the rate (IAS 23, para. 14); the amendment applies prospectively to annual periods beginning on or after 1 January 2019 (IAS 23, para. 28A and 29D). Approach: check the treatment and the effective date separately. Trap: confusing the improvements cycle (2015-2017) with the effective date, or prospective with retrospective application. Rule to remember: The 2015-2017 amendment applies prospectively to annual periods beginning on or after 1 January 2019.","es":""},"common_error":{"fr":"","en":"Taking 2015 as the effective date of the amendment.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"A specific borrowing still outstanding after its asset is complete is excluded from the capitalisation rate; prospective application to annual periods beginning on or after 1 January 2019.","es":""},"correct":false,"feedback":{"fr":"","en":"The date and the prospective nature are right (IAS 23, para. 28A and 29D), but the treatment is reversed: the specific borrowing still outstanding after completion joins general borrowings in the calculation of the rate (IAS 23, para. 14). It is not excluded from it. Rule to remember: The 2015-2017 amendment applies prospectively to annual periods beginning on or after 1 January 2019.","es":""}},{"id":"B","text":{"fr":"","en":"A specific borrowing still outstanding after its asset is complete joins general borrowings; retrospective application with restatement of prior years.","es":""},"correct":false,"feedback":{"fr":"","en":"The treatment is right (IAS 23, para. 14), but the application is not retrospective: the amendment applies prospectively (IAS 23, para. 28A and 29D). No restatement of prior years is provided for. Rule to remember: The 2015-2017 amendment applies prospectively to annual periods beginning on or after 1 January 2019.","es":""}},{"id":"C","text":{"fr":"","en":"A specific borrowing still outstanding after its asset is complete joins general borrowings; prospective application to annual periods beginning on or after 1 January 2019.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"A specific borrowing still outstanding after its asset is complete joins general borrowings; prospective application to annual periods beginning on or after 1 January 2015.","es":""},"correct":false,"feedback":{"fr":"","en":"The treatment and the prospective nature are right, but the effective date is 1 January 2019, not 2015 (IAS 23, para. 28A and 29D). 2015-2017 names the improvements cycle, not the application date. Rule to remember: The 2015-2017 amendment applies prospectively to annual periods beginning on or after 1 January 2019.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000062","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS36_NRV"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000062","tested_point":"QST.IAS23.000062","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-ias36"},"references":["IAS 23 §16"],"exercise":{"prompt":{"fr":"","en":"An entity has capitalised borrowing costs in the cost of a qualifying asset. What must it check before keeping the carrying amount so obtained?","es":""},"explanation":{"fr":"","en":"After capitalisation, the carrying amount of the asset is compared with its recoverable amount (or with net realisable value for inventory) and reduced to that amount if it exceeds it, under the applicable standards (IAS 23, para. 16). Approach: compute the carrying amount including the costs capitalised, then compare it. Trap: thinking that capitalising borrowing costs removes the need for the value test. Rule to remember: Capitalised borrowing costs are part of the carrying amount, which remains subject to comparison with the recoverable amount or net realisable value.","es":""},"common_error":{"fr":"","en":"Considering that capitalised borrowing costs are immune from any write-down.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"That the carrying amount does not exceed the recoverable amount or, for inventory, the net realisable value.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Nothing more: capitalising the borrowing costs validates the carrying amount of the asset.","es":""},"correct":false,"feedback":{"fr":"","en":"Capitalising borrowing costs does not exempt the asset from the value check: if the carrying amount exceeds the recoverable amount or net realisable value, it is reduced to that amount under the applicable standards (IAS 23, para. 16). The costs capitalised are part of the carrying amount tested. Rule to remember: Capitalised borrowing costs are part of the carrying amount, which remains subject to comparison with the recoverable amount or net realisable value.","es":""}},{"id":"C","text":{"fr":"","en":"That the borrowing costs capitalised are below 10% of the total cost of the asset.","es":""},"correct":false,"feedback":{"fr":"","en":"No 10% threshold is provided for: the check is a comparison of the carrying amount with the recoverable amount or net realisable value (IAS 23, para. 16). A percentage of capitalised interest does not replace that comparison. Rule to remember: Capitalised borrowing costs are part of the carrying amount, which remains subject to comparison with the recoverable amount or net realisable value.","es":""}},{"id":"D","text":{"fr":"","en":"That the carrying amount equals the fair value of the asset at the reporting date.","es":""},"correct":false,"feedback":{"fr":"","en":"The comparison is with the recoverable amount (or net realisable value), not an equality with fair value: the carrying amount is reduced only if it exceeds that amount (IAS 23, para. 16). Equality is not required. Rule to remember: Capitalised borrowing costs are part of the carrying amount, which remains subject to comparison with the recoverable amount or net realisable value.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000063","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS36_NRV"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000063","tested_point":"QST.IAS23.000063","difficulty":"ADVANCED","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-ias36"},"references":["IAS 23 §16"],"exercise":{"prompt":{"fr":"","en":"A hotel under construction of Pelissier is carried at {carrying_amount}, including {capitalised_borrowing_costs} of capitalised borrowing costs. Its recoverable amount is estimated at {recoverable_amount} (case data). Calculate the carrying amount after comparison with the recoverable amount, then the loss to recognise.","es":""},"explanation":{"fr":"","en":"If the carrying amount exceeds the recoverable amount, it is reduced to that amount under the applicable standards (IAS 23, para. 16). Carrying amount after comparison = minimum (9,400,000; 8,900,000) = 8,900,000; loss = 9,400,000 − 8,900,000 = 500,000. The 420,000 of capitalised borrowing costs is part of the amount tested. Trap: setting the capitalised costs aside from the test and comparing only 8,980,000. Rule to remember: The carrying amount, including capitalised borrowing costs, is reduced to the recoverable amount if it exceeds it.","es":""},"common_error":{"fr":"","en":"Excluding capitalised borrowing costs from the carrying amount compared with the recoverable amount.","es":""},"format":"CALCULATION","placeholders":[{"id":"carrying_amount","value":"9400000","unit":"EUR"},{"id":"capitalised_borrowing_costs","value":"420000","unit":"EUR"},{"id":"recoverable_amount","value":"8900000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"Carrying amount","es":""},"value":"9400000","unit":"EUR"},{"label":{"fr":"","en":"Capitalised borrowing costs (included)","es":""},"value":"420000","unit":"EUR"},{"label":{"fr":"","en":"Estimated recoverable amount","es":""},"value":"8900000","unit":"EUR"}],"steps":[{"id":"CARRYING_AFTER_TEST","label":{"fr":"","en":"Carrying amount after comparison","es":""},"answer":8900000,"tolerance":0,"unit":"EUR"},{"id":"LOSS","label":{"fr":"","en":"Loss to recognise","es":""},"answer":500000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"LOSS","meaning":{"fr":"","en":"Loss to recognise","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount","es":""},"value":9400000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Estimated recoverable amount","es":""},"value":8900000,"unit":"EUR"}],"result":500000,"unit":"EUR"}],"rationale":{"fr":"","en":"The carrying amount, including capitalised borrowing costs, is reduced to the recoverable amount if it exceeds it.","es":""},"references":["REF.IAS23.16"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000065","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS16"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000065","tested_point":"QST.IAS23.000065","difficulty":"ADVANCED","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-ias16"},"references":["IAS 23 §8"],"exercise":{"prompt":{"fr":"","en":"Cardin has constructed an item of equipment whose eligible expenditure amounts to {eligible_expenditure}. It has capitalised {capitalised_borrowing_costs} of borrowing costs in it. Case convention: straight-line depreciation over {useful_life}, with no residual value. Calculate the cost of the asset, then the annual depreciation charge.","es":""},"explanation":{"fr":"","en":"Capitalised borrowing costs form part of the cost of the asset (IAS 23, para. 8). Cost = 5,200,000 + 310,000 = 5,510,000. Case convention: straight-line depreciation over 20 years with no residual value; charge = 5,510,000 / 20 = 275,500. Trap: depreciating only the 5,200,000 of expenditure, that is 260,000 a year. Rule to remember: The cost of the asset includes capitalised borrowing costs, and depreciation is calculated on that cost.","es":""},"common_error":{"fr":"","en":"Calculating depreciation on construction expenditure alone, without the capitalised interest.","es":""},"format":"CALCULATION","placeholders":[{"id":"eligible_expenditure","value":"5200000","unit":"EUR"},{"id":"capitalised_borrowing_costs","value":"310000","unit":"EUR"},{"id":"useful_life","value":"20","unit":"YEARS"}],"data":[{"label":{"fr":"","en":"Eligible expenditure","es":""},"value":"5200000","unit":"EUR"},{"label":{"fr":"","en":"Capitalised borrowing costs","es":""},"value":"310000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"20","unit":"YEARS"}],"steps":[{"id":"ASSET_COST","label":{"fr":"","en":"Cost of the asset","es":""},"answer":5510000,"tolerance":0,"unit":"EUR"},{"id":"ANNUAL_DEPRECIATION","label":{"fr":"","en":"Annual depreciation charge","es":""},"answer":275500,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"ASSET_COST","meaning":{"fr":"","en":"Cost of the asset","es":""},"expression":"a + b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Eligible expenditure","es":""},"value":5200000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Capitalised borrowing costs","es":""},"value":310000,"unit":"EUR"}],"result":5510000,"unit":"EUR"},{"step":"ANNUAL_DEPRECIATION","meaning":{"fr":"","en":"Annual depreciation charge","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the asset","es":""},"value":5510000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Useful life","es":""},"value":20,"unit":"YEARS"}],"result":275500,"unit":"EUR"}],"rationale":{"fr":"","en":"The cost of the asset includes capitalised borrowing costs, and depreciation is calculated on that cost.","es":""},"references":["REF.IAS23.8"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000068","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS38"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS23.000068","tested_point":"QST.IAS23.000068","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-ias38"},"references":["IAS 23 §7"],"exercise":{"prompt":{"fr":"","en":"An entity develops software over 24 months in the development phase, financed by a dedicated loan. What can be said about applying the borrowing costs standard to this project?","es":""},"explanation":{"fr":"","en":"Among the examples of assets that can be qualifying are certain intangible assets (IAS 23, para. 7). Software whose development requires a substantial period, here 24 months (case data), can therefore be qualifying; its directly attributable borrowing costs are then capitalisable. Approach: apply the test of the preparation period, not the nature of the asset. Trap: excluding an intangible asset from the scope. Rule to remember: An intangible asset under development can be a qualifying asset if its preparation requires a substantial period.","es":""},"common_error":{"fr":"","en":"Excluding software from the scope on the ground that it is intangible.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Intangible assets are outside the scope of the standard: the project's interest is therefore an expense.","es":""},"correct":false,"feedback":{"fr":"","en":"Intangible assets are among the examples of assets that can be qualifying: they are not outside the scope (IAS 23, para. 7). The test is the substantial development period. Rule to remember: An intangible asset under development can be a qualifying asset if its preparation requires a substantial period.","es":""}},{"id":"B","text":{"fr":"","en":"The software is qualifying as soon as it is financed by a loan, whatever the development period.","es":""},"correct":false,"feedback":{"fr":"","en":"Financing by a loan does not make an asset qualifying: a substantial period is needed to get it ready, which is assessed on the facts (IAS 23, para. 7). The 24 months in the case are data, not an effect of the loan. Rule to remember: An intangible asset under development can be a qualifying asset if its preparation requires a substantial period.","es":""}},{"id":"C","text":{"fr":"","en":"Borrowing costs can be capitalised only after the software goes into production.","es":""},"correct":false,"feedback":{"fr":"","en":"Capitalisation concerns the preparation period of the asset and ceases when it is substantially ready: it does not begin at go-live. The borrowing costs of the development phase are the ones concerned. Rule to remember: An intangible asset under development can be a qualifying asset if its preparation requires a substantial period.","es":""}},{"id":"D","text":{"fr":"","en":"The software can be a qualifying asset, because it requires a substantial development period.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000069","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS20_GRANTS"],"dimension":"CALCULATION","context":"V1_QST.IAS23.000069","tested_point":"QST.IAS23.000069","difficulty":"ADVANCED","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-grants"},"references":["IAS 23 §18"],"exercise":{"prompt":{"fr":"","en":"Lucas is building a logistics platform. It paid {cash_paid} in cash and assumed interest-bearing liabilities of {interest_bearing_liabilities}; it received a grant related to the asset of {grant_received}. Case convention: a specific borrowing finances exactly the eligible expenditure, at {annual_rate} a year, for {months_financed}. Calculate the eligible expenditure, then the borrowing costs eligible for capitalisation.","es":""},"explanation":{"fr":"","en":"Eligible expenditure is net of grants received in respect of the asset (IAS 23, para. 18): 3,200,000 + 300,000 − 700,000 = 2,800,000. Under the case convention, the borrowing finances exactly that amount: costs eligible = 2,800,000 × 5% × 6/12 = 70,000. Effect: the grant reduces the financed base and therefore the borrowing costs capitalised. Trap: calculating on 3,500,000, that is 87,500. Rule to remember: An asset grant received reduces eligible expenditure, and therefore the base on which borrowing costs are capitalised.","es":""},"common_error":{"fr":"","en":"Calculating the capitalisable interest on gross expenditure, without deducting the grant received.","es":""},"format":"CALCULATION","placeholders":[{"id":"cash_paid","value":"3200000","unit":"EUR"},{"id":"interest_bearing_liabilities","value":"300000","unit":"EUR"},{"id":"grant_received","value":"700000","unit":"EUR"},{"id":"annual_rate","value":"5","unit":"PERCENT"},{"id":"months_financed","value":"6","unit":"MONTHS"}],"data":[{"label":{"fr":"","en":"Cash paid","es":""},"value":"3200000","unit":"EUR"},{"label":{"fr":"","en":"Interest-bearing liabilities assumed","es":""},"value":"300000","unit":"EUR"},{"label":{"fr":"","en":"Asset grant received","es":""},"value":"700000","unit":"EUR"},{"label":{"fr":"","en":"Annual interest rate","es":""},"value":"5","unit":"PERCENT"},{"label":{"fr":"","en":"Financing period","es":""},"value":"6","unit":"MONTHS"}],"steps":[{"id":"ELIGIBLE_EXPENDITURE","label":{"fr":"","en":"Eligible expenditure","es":""},"answer":2800000,"tolerance":0,"unit":"EUR"},{"id":"ELIGIBLE_COSTS","label":{"fr":"","en":"Costs eligible for capitalisation","es":""},"answer":70000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"ELIGIBLE_EXPENDITURE","meaning":{"fr":"","en":"Eligible expenditure","es":""},"expression":"a + b - c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cash paid","es":""},"value":3200000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Interest-bearing liabilities assumed","es":""},"value":300000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Asset grant received","es":""},"value":700000,"unit":"EUR"}],"result":2800000,"unit":"EUR","rationale":{"fr":"","en":"Eligible expenditure is net of grants received in respect of the asset (IAS 23, para. 18): 3,200,000 + 300,000 − 700,000 = 2,800,000.","es":""}},{"step":"ELIGIBLE_COSTS","meaning":{"fr":"","en":"Costs eligible for capitalisation","es":""},"expression":"a * b * c / 12","variables":[{"symbol":"a","meaning":{"fr":"","en":"Eligible expenditure","es":""},"value":2800000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Annual interest rate","es":""},"value":5,"unit":"PERCENT"},{"symbol":"c","meaning":{"fr":"","en":"Financing period","es":""},"value":6,"unit":"MONTHS"}],"result":70000,"unit":"EUR"}],"rationale":{"fr":"","en":"An asset grant received reduces eligible expenditure, and therefore the base on which borrowing costs are capitalised.","es":""},"references":["REF.IAS23.18"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS23.000070","standard_id":"IAS23","concept_ids":["IAS23.INTERACTIONS.IAS20_GRANTS"],"dimension":"APPLICATION","context":"V1_QST.IAS23.000070","tested_point":"QST.IAS23.000070","difficulty":"EXPERT","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":140,"lesson_id":null,"review":{"standard_id":"IAS23","lesson_id":"LS.IAS23.000012","section_id":"rule-grants"},"references":["IAS 23 §18"],"exercise":{"prompt":{"fr":"","en":"Naval acquires equipment of 4,000,000 and receives an asset grant of 800,000. Case convention: straight-line depreciation over 10 years with no residual value; the entity chooses between two presentations, deferred income released over 10 years, or deduction of the grant from the cost of the asset. What is the difference in net annual effect on profit or loss between the two presentations?","es":""},"explanation":{"fr":"","en":"With deferred income, the asset stays at 4,000,000: depreciation 400,000, release of 800,000 / 10 = 80,000, net effect 320,000. With deduction from cost, the asset is at 3,200,000 (IAS 23, para. 18): depreciation 3,200,000 / 10 = 320,000. The net effect on profit or loss is the same; what changes is the balance sheet presentation and the detail of the income statement. Case convention: the entity chooses the presentation, the standard does not impose it. Trap: comparing gross depreciation with net depreciation without the release. Rule to remember: Both presentations of the grant give the same net annual effect on profit or loss; they differ in presentation.","es":""},"common_error":{"fr":"","en":"Comparing gross depreciation with depreciation on the net cost and forgetting the release of deferred income.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"None: the net annual effect on profit or loss is 320,000 under both presentations.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Deduction from cost gives 80,000 more net expense than deferred income.","es":""},"correct":false,"feedback":{"fr":"","en":"Both presentations give the same net effect: 400,000 − 80,000 = 320,000 with deferred income, and 3,200,000 / 10 = 320,000 with deduction from cost (IAS 23, para. 18). There is no 80,000 difference. Rule to remember: Both presentations of the grant give the same net annual effect on profit or loss; they differ in presentation.","es":""}},{"id":"C","text":{"fr":"","en":"Deferred income gives 80,000 more net expense than deduction from cost.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer forgets the annual release of 80,000 of deferred income, which offsets the gross depreciation of 400,000: the net effect is 320,000, as with deduction from cost (IAS 23, para. 18). No difference in net expense appears. Rule to remember: Both presentations of the grant give the same net annual effect on profit or loss; they differ in presentation.","es":""}},{"id":"D","text":{"fr":"","en":"Deferred income gives a net effect of 400,000 and deduction from cost a net effect of 320,000.","es":""},"correct":false,"feedback":{"fr":"","en":"With deferred income, the gross depreciation of 400,000 is offset by the annual release of 80,000: the net effect is 320,000, not 400,000 (IAS 23, para. 18). The two presentations converge. Rule to remember: Both presentations of the grant give the same net annual effect on profit or loss; they differ in presentation.","es":""}}]},"scope":"CORE_STUDENT"}],"reviewTitles":{"LX.IAS23.000001":"IAS 23: capitalise into the cost of the asset or expense — Understand: why capitalise interest?","LX.IAS23.000002":"IAS 23: capitalise into the cost of the asset or expense — The rule: capitalise or expense","LX.IAS23.000003":"IAS 23: capitalise into the cost of the asset or expense — Directly attributable: the avoidance test","LX.IAS23.000004":"IAS 23: capitalise into the cost of the asset or expense — Numerical example: the company Marvane","LX.IAS23.000005":"IAS 23: capitalise into the cost of the asset or expense — The entry: capitalised interest and interest expense","LX.IAS23.000006":"IAS 23: capitalise into the cost of the asset or expense — The rule: capitalise or expense","LX.IAS23.000007":"IAS 23: capitalise into the cost of the asset or expense — The conditions for capitalisation","LX.IAS23.000008":"IAS 23: capitalise into the cost of the asset or expense — Professional judgement: linking a loan to an asset","LX.IAS23.000009":"IAS 23: scope and exemption — The rule: scope and the mandatory nature","LX.IAS23.000010":"IAS 23: scope and exemption — The rule: scope and the mandatory nature","LX.IAS23.000011":"IAS 23: scope and exemption — Assets exempted from the standard","LX.IAS23.000012":"IAS 23: scope and exemption — Simple example: four assets of Calvane","LX.IAS23.000013":"IAS 23: scope and exemption — Points of attention","LX.IAS23.000014":"The qualifying asset and borrowing costs: the definitions — The rule: definition of a qualifying asset","LX.IAS23.000015":"The qualifying asset and borrowing costs: the definitions — Approach: is this asset qualifying?","LX.IAS23.000016":"The qualifying asset and borrowing costs: the definitions — What borrowing costs are","LX.IAS23.000017":"The qualifying asset and borrowing costs: the definitions — Examples of qualifying assets","LX.IAS23.000018":"The qualifying asset and borrowing costs: the definitions — Examples of qualifying assets","LX.IAS23.000019":"The qualifying asset and borrowing costs: the definitions — Approach: is this asset qualifying?","LX.IAS23.000020":"The qualifying asset and borrowing costs: the definitions — The rule: definition of a qualifying asset","LX.IAS23.000021":"The qualifying asset and borrowing costs: the definitions — Professional judgement: the substantial period","LX.IAS23.000022":"The qualifying asset and borrowing costs: the definitions — Professional judgement: the substantial period","LX.IAS23.000023":"The components of borrowing costs — The rule: three components","LX.IAS23.000024":"The components of borrowing costs — The rule: three components","LX.IAS23.000025":"The components of borrowing costs — Numerical example: the interest of a period","LX.IAS23.000026":"The components of borrowing costs — The rule: three components","LX.IAS23.000027":"The components of borrowing costs — Exchange differences regarded as interest","LX.IAS23.000028":"The components of borrowing costs — Professional judgement: the comparable exchange part","LX.IAS23.000029":"The specific borrowing: actual costs and temporary investment income — The rule: the actual cost of the period","LX.IAS23.000030":"The specific borrowing: actual costs and temporary investment income — The rule: the actual cost of the period","LX.IAS23.000031":"The specific borrowing: actual costs and temporary investment income — Numerical example: the company Prélane","LX.IAS23.000032":"The specific borrowing: actual costs and temporary investment income — Deducting temporary investment income","LX.IAS23.000033":"The specific borrowing: actual costs and temporary investment income — Numerical example: the company Prélane","LX.IAS23.000034":"The specific borrowing: actual costs and temporary investment income — The entry: capitalised interest and income deducted","LX.IAS23.000035":"The specific borrowing: actual costs and temporary investment income — Deducting temporary investment income","LX.IAS23.000036":"The specific borrowing: actual costs and temporary investment income — Numerical example: the company Prélane","LX.IAS23.000037":"The specific borrowing: actual costs and temporary investment income — Points of attention","LX.IAS23.000038":"The specific borrowing: actual costs and temporary investment income — Complements on specific borrowings","LX.IAS23.000039":"The specific borrowing: actual costs and temporary investment income — Complements on specific borrowings","LX.IAS23.000040":"General borrowings: capitalisation rate and cap — Understand: when no loan is dedicated to the asset","LX.IAS23.000041":"General borrowings: capitalisation rate and cap — The rule: the capitalisation rate","LX.IAS23.000042":"General borrowings: capitalisation rate and cap — Numerical example: the company Vandelle","LX.IAS23.000043":"General borrowings: capitalisation rate and cap — Numerical example: the company Vandelle","LX.IAS23.000044":"General borrowings: capitalisation rate and cap — The cap: not beyond the costs incurred","LX.IAS23.000045":"General borrowings: capitalisation rate and cap — Numerical example: the cap applied","LX.IAS23.000046":"General borrowings: capitalisation rate and cap — The entry: splitting the interest incurred","LX.IAS23.000047":"General borrowings: capitalisation rate and cap — Points of attention","LX.IAS23.000048":"General borrowings: capitalisation rate and cap — A specific borrowing still outstanding after completion","LX.IAS23.000049":"General borrowings: capitalisation rate and cap — A specific borrowing still outstanding after completion","LX.IAS23.000050":"General borrowings: capitalisation rate and cap — Group borrowings","LX.IAS23.000051":"Commencement of capitalisation and eligible expenditure — The rule: three elements to begin","LX.IAS23.000052":"Commencement of capitalisation and eligible expenditure — The rule: three elements to begin","LX.IAS23.000053":"Commencement of capitalisation and eligible expenditure — Example: the timeline of the company Mervane","LX.IAS23.000054":"Commencement of capitalisation and eligible expenditure — Example: the timeline of the company Mervane","LX.IAS23.000055":"Commencement of capitalisation and eligible expenditure — The rule: eligible expenditure","LX.IAS23.000056":"Commencement of capitalisation and eligible expenditure — Numerical example: the eligible expenditure of the company Falvane","LX.IAS23.000057":"Commencement of capitalisation and eligible expenditure — Land held awaiting, with no activity","LX.IAS23.000058":"Commencement of capitalisation and eligible expenditure — Points of attention","LX.IAS23.000059":"Commencement of capitalisation and eligible expenditure — Professional judgement: when are preparation activities in progress?","LX.IAS23.000060":"Suspension of capitalisation — The rule: suspension during extended periods","LX.IAS23.000061":"Suspension of capitalisation — The rule: suspension during extended periods","LX.IAS23.000062":"Suspension of capitalisation — Numerical example: the effect of suspension","LX.IAS23.000063":"Suspension of capitalisation — The entry: capitalised and suspended interest","LX.IAS23.000064":"Suspension of capitalisation — The exceptions: no suspension","LX.IAS23.000065":"Suspension of capitalisation — The exceptions: no suspension","LX.IAS23.000066":"Suspension of capitalisation — Professional judgement: extended or temporary?","LX.IAS23.000067":"Suspension of capitalisation — Professional judgement: extended or temporary?","LX.IAS23.000068":"The end of capitalisation: substantial completion — The rule: substantially all activities complete","LX.IAS23.000069":"The end of capitalisation: substantial completion — The rule: substantially all activities complete","LX.IAS23.000070":"The end of capitalisation: substantial completion — Numerical example: the company Harvane","LX.IAS23.000071":"The end of capitalisation: substantial completion — The entry: transferring the cost to the asset in service","LX.IAS23.000072":"The end of capitalisation: substantial completion — The rule: substantially all activities complete","LX.IAS23.000073":"The end of capitalisation: substantial completion — Points of attention","LX.IAS23.000074":"The end of capitalisation: substantial completion — An asset completed in parts","LX.IAS23.000075":"The end of capitalisation: substantial completion — An asset completed in parts","LX.IAS23.000076":"Disclosures on borrowing costs — The rule: two disclosures","LX.IAS23.000077":"Disclosures on borrowing costs — The rule: two disclosures","LX.IAS23.000078":"Disclosures on borrowing costs — Numerical example: the note of the company Janelle","LX.IAS23.000079":"Disclosures on borrowing costs — Numerical example: the note of the company Janelle","LX.IAS23.000080":"Disclosures on borrowing costs — Points of attention","LX.IAS23.000081":"Transition and effective date — The 2015-2017 amendment","LX.IAS23.000082":"Transition and effective date — The 2015-2017 amendment","LX.IAS23.000083":"Transition and effective date — The original provisions (2007)","LX.IAS23.000084":"Transition and effective date — The 2015-2017 amendment","LX.IAS23.000085":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 16: the constructed asset","LX.IAS23.000086":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — Numerical example: depreciation of a constructed plant","LX.IAS23.000087":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 2: qualifying inventories","LX.IAS23.000088":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 2: qualifying inventories","LX.IAS23.000089":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 36 and IAS 2: recoverable amount","LX.IAS23.000090":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 36 and IAS 2: recoverable amount","LX.IAS23.000091":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 38: the intangible asset under development","LX.IAS23.000092":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 20: the asset grant","LX.IAS23.000093":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — Numerical example: the two presentations","LX.IAS23.000094":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — The annual entry under the deferred income presentation","LX.IAS23.000095":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — Professional judgement: the grant and the value of the asset","LX.IAS23.000096":"The components of borrowing costs — The rule: three components","LX.IAS23.000097":"Transition and effective date — The 2015-2017 amendment","QST.IAS23.000001":"IAS 23: capitalise into the cost of the asset or expense — Understand: why capitalise interest?","QST.IAS23.000002":"IAS 23: capitalise into the cost of the asset or expense — Understand: why capitalise interest?","QST.IAS23.000003":"IAS 23: capitalise into the cost of the asset or expense — The rule: capitalise or expense","QST.IAS23.000004":"IAS 23: capitalise into the cost of the asset or expense — The rule: capitalise or expense","QST.IAS23.000006":"IAS 23: capitalise into the cost of the asset or expense — The conditions for capitalisation","QST.IAS23.000007":"IAS 23: capitalise into the cost of the asset or expense — Directly attributable: the avoidance test","QST.IAS23.000010":"IAS 23: scope and exemption — The rule: scope and the mandatory nature","QST.IAS23.000011":"IAS 23: scope and exemption — Assets exempted from the standard","QST.IAS23.000012":"The qualifying asset and borrowing costs: the definitions — The rule: definition of a qualifying asset","QST.IAS23.000014":"The qualifying asset and borrowing costs: the definitions — What borrowing costs are","QST.IAS23.000015":"The qualifying asset and borrowing costs: the definitions — What borrowing costs are","QST.IAS23.000016":"The qualifying asset and borrowing costs: the definitions — Examples of qualifying assets","QST.IAS23.000017":"The qualifying asset and borrowing costs: the definitions — Examples of qualifying assets","QST.IAS23.000018":"The components of borrowing costs — The rule: three components","QST.IAS23.000019":"The components of borrowing costs — The rule: three components","QST.IAS23.000020":"The components of borrowing costs — Exchange differences regarded as interest","QST.IAS23.000021":"The specific borrowing: actual costs and temporary investment income — The rule: the actual cost of the period","QST.IAS23.000022":"The specific borrowing: actual costs and temporary investment income — The rule: the actual cost of the period","QST.IAS23.000023":"The components of borrowing costs — The rule: three components","QST.IAS23.000024":"The specific borrowing: actual costs and temporary investment income — Deducting temporary investment income","QST.IAS23.000026":"The specific borrowing: actual costs and temporary investment income — Deducting temporary investment income","QST.IAS23.000027":"The specific borrowing: actual costs and temporary investment income — The rule: the actual cost of the period","QST.IAS23.000028":"General borrowings: capitalisation rate and cap — The rule: the capitalisation rate","QST.IAS23.000029":"General borrowings: capitalisation rate and cap — The rule: the capitalisation rate","QST.IAS23.000032":"General borrowings: capitalisation rate and cap — A specific borrowing still outstanding after completion","QST.IAS23.000034":"General borrowings: capitalisation rate and cap — Group borrowings","QST.IAS23.000035":"General borrowings: capitalisation rate and cap — The rule: the capitalisation rate","QST.IAS23.000036":"General borrowings: capitalisation rate and cap — The cap: not beyond the costs incurred","QST.IAS23.000037":"General borrowings: capitalisation rate and cap — The cap: not beyond the costs incurred","QST.IAS23.000038":"General borrowings: capitalisation rate and cap — The rule: the capitalisation rate","QST.IAS23.000039":"Commencement of capitalisation and eligible expenditure — The rule: three elements to begin","QST.IAS23.000040":"IAS 23: capitalise into the cost of the asset or expense — The rule: capitalise or expense","QST.IAS23.000042":"Commencement of capitalisation and eligible expenditure — The rule: eligible expenditure","QST.IAS23.000043":"General borrowings: capitalisation rate and cap — The rule: the capitalisation rate","QST.IAS23.000045":"Commencement of capitalisation and eligible expenditure — The rule: eligible expenditure","QST.IAS23.000046":"Commencement of capitalisation and eligible expenditure — Land held awaiting, with no activity","QST.IAS23.000047":"Suspension of capitalisation — The rule: suspension during extended periods","QST.IAS23.000048":"Suspension of capitalisation — The rule: suspension during extended periods","QST.IAS23.000050":"Suspension of capitalisation — The exceptions: no suspension","QST.IAS23.000051":"Suspension of capitalisation — The exceptions: no suspension","QST.IAS23.000052":"Suspension of capitalisation — The rule: suspension during extended periods","QST.IAS23.000053":"The end of capitalisation: substantial completion — The rule: substantially all activities complete","QST.IAS23.000055":"IAS 23: capitalise into the cost of the asset or expense — The rule: capitalise or expense","QST.IAS23.000056":"The end of capitalisation: substantial completion — An asset completed in parts","QST.IAS23.000057":"Disclosures on borrowing costs — The rule: two disclosures","QST.IAS23.000058":"Disclosures on borrowing costs — The rule: two disclosures","QST.IAS23.000059":"General borrowings: capitalisation rate and cap — The rule: the capitalisation rate","QST.IAS23.000060":"IAS 23: scope and exemption — The rule: scope and the mandatory nature","QST.IAS23.000061":"General borrowings: capitalisation rate and cap — The rule: the capitalisation rate","QST.IAS23.000062":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 36 and IAS 2: recoverable amount","QST.IAS23.000063":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 36 and IAS 2: recoverable amount","QST.IAS23.000065":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 16: the constructed asset","QST.IAS23.000068":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 38: the intangible asset under development","QST.IAS23.000069":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 20: the asset grant","QST.IAS23.000070":"At the boundaries: IAS 16, IAS 2, IAS 36, IAS 38 and IAS 20 — With IAS 20: the asset grant"}}