Costs incurred unevenly

Learning objectives

• Determine that a cost incurred unevenly during the financial year is anticipated or deferred at the interim date only if it would also be appropriate to anticipate or defer that type of cost at the end of the financial year.L2

Normative references

• IAS 34 §39Costs that are incurred unevenly during an entity's financial year are anticipated or deferred for interim reporting purposes if, and only if, it is also appropriate to anticipate or defer that type of cost at the end of the financial year.

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

2 questions

• Which statements about the treatment, in an interim report, of a cost incurred unevenly during the year are correct? More than one answer is possible.L2
• Merkan SA carries out in September the annual scheduled maintenance of its production lines, for EUR 240,000 (case data). Case assumptions: the maintenance is performed and invoiced in the third quarter; before it is performed, Merkan SA has no obligation to carry it out, and the cost does not meet the definition of an asset at the annual closing. Management proposes to recognise EUR 60,000 per quarter "to smooth the quarters". What must Merkan SA do?L2