Scope of the standard

Learning objectives

• Identify the scope of the Standard, which applies in accounting for borrowing costs and does not deal with the cost of equity.L1, L2

Normative references

• IAS 23 §2The Standard applies in accounting for borrowing costs.
• IAS 23 §3The Standard does not deal with the actual or imputed cost of equity, including preferred capital not classified as a liability.

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

2 questions

• 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.L2
• The original transition and effective date provisions of the standard (2007 revision) accompanied a substantive change in the treatment of borrowing costs. Which one?L3