Non-depreciable assets

Learning objectives

• Analyse how a grant related to a non-depreciable asset is recognised in profit or loss over the periods that bear the cost of meeting the obligations attached to it.L3

Normative references

• IAS 20 §18Grant related to a non-depreciable asset with attached obligations: it is recognised over the periods that bear the cost of meeting those obligations (example: land granted on condition that a building is erected, recognised over the life of the building).

Original summaries of the paragraphs (reference register), never a quotation of the standard.

1 question

• Vidal receives EUR 500,000 to acquire a plot of land, on condition that an industrial building is built on it within three years. The land is not depreciated. In three to five sentences, justify how you would analyse the matching of this grant to profit or loss.L3