IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine

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Standard 2021 Issued
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IFRIC 20 deals with accounting for the costs of removing waste materials to gain access to mineral ore deposits. This waste removal activity is known as ‘stripping’. Some stripping activity produces saleable inventory while also improving access to further quantities of mineral ore.

An entity accounts for the costs of stripping activity applying the principles of IAS 2 to the extent that the stripping activity results in inventory. The entity recognises the costs of stripping activity that improves access to ore as a non-current ‘stripping activity asset’ if specified criteria are met; otherwise it recognises those costs as an expense. IFRIC 20 provides cost allocation guidance for when the costs of the stripping activity asset and the inventory produced are not separately identifiable.

Standard history

In October 2011 the International Accounting Standards Board issued IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine. It was developed by the Interpretations Committee.

Other Standards have made minor consequential amendments to IFRIC 20, including Amendments to References to the Conceptual Framework in IFRS Standards (issued March 2018).

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