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Thursday 28 August 2014

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IFRS Interpretations Committee

Variable payments for the separate acquisition of PPE and intangible assets


 IFRS Interpretations Committee work in progress

IAS 16 Property, Plant and Equipment, IAS 38 Intangible Assets and IFRIC 12 Service Concession Arrangements: Variable payments for the separate acquisition of PPE and intangible assets

The Interpretations Committee received a request to address an issue that is related to contractual payments that are made by an operator under a service concession arrangement that is within the scope of IFRIC 12. Specifically, the submitter requested that the Interpretations Committee should clarify in what circumstances (if any) those payments should:

  1. be included in the measurement of an asset and liability at the start of the concession; or
  2. be accounted for as executory in nature (ie be recognised as expenses as they are incurred over the term of the concession arrangement).
     

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