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@chally said:
True research is expensed when incurred. however the plant depreciation used on development is capitalisedReally capitalizing depreciation? How can that be? Common man PPE are assets and depreciation on them are expensed as incurred no IAS or IFRS supported the capitalization of depreciation…maybe you should come clear on this!
@chally said:
True research is expensed when incurred. however the plant depreciation used on development is capitalisedIdeally Development cost is capitalised when some conditions are met and which I believe we all know and remember we don’t depreciate Development cost og not completed yet??? as depreciation starts from the date it is substantially completed so are you saying depreciation of plant should be added and re-depreciated? pls come clear
@hayor said:
Ideally Development cost is capitalised when some conditions are met and which I believe we all know and remember we don’t depreciate Development cost og not completed yet??? as depreciation starts from the date it is substantially completed so are you saying depreciation of plant should be added and re-depreciated? pls come clearRelated to Depreciation of plant used for development project, somewhere I read that Depreciation should be charged to profit or loss, unless it is included in the carrying amount of another asset. Since we are capitalizing development cost as an asset, we can capitalize those depreciation expense rather than charging to P&L
@denny1 said:
Related to Depreciation of plant used for development project, somewhere I read that Depreciation should be charged to profit or loss, unless it is included in the carrying amount of another asset. Since we are capitalizing development cost as an asset, we can capitalize those depreciation expense rather than charging to P&LSo technically by adding depreciation to development cost the implication is that we are adding part of cost of an asset if not all to development cost????
please did any IAS or IFRS support that…..in my opinion not making it general….depreciation on capital asset should be expensed regardless of what purpose it serves as we do not recapitalize depreciation.
Any opinion to the contrary will be welcomed….pls lets b clear…..i need to learn more
Oh maybe now I get it…..according to the standard “research cost other than on capital asset should be expensed” meaning an asset acquired for for research purpose should not be expensed but instead capitalized as PPE of an entity and depreciated in accordance with the provison of the standard…….No where did the standard supported the capitalization of depreciation of asset in relation to research…..
@hayor said:
Ideally Development cost is capitalised when some conditions are met and which I believe we all know and remember we don’t depreciate Development cost og not completed yet??? as depreciation starts from the date it is substantially completed so are you saying depreciation of plant should be added and re-depreciated? pls come clearThe kaplan text book stated that yes.
@hayor said:
Oh maybe now I get it…..according to the standard “research cost other than on capital asset should be expensed” meaning an asset acquired for for research purpose should not be expensed but instead capitalized as PPE of an entity and depreciated in accordance with the provison of the standard…….No where did the standard supported the capitalization of depreciation of asset in relation to research…..Future ecomic benefits will flow through the entity when the development capitalised is ready for sale and its intended use. so the depreciation on the plant used to prepare that development cost should be realised when the asset is read for use. hence the capitalisation.
@hayor said:
So technically by adding depreciation to development cost the implication is that we are adding part of cost of an asset if not all to development cost????please did any IAS or IFRS support that…..in my opinion not making it general….depreciation on capital asset should be expensed regardless of what purpose it serves as we do not recapitalize depreciation.
Any opinion to the contrary will be welcomed….pls lets b clear…..i need to learn more
You need to capitalize depreciation because it’s a cost that needs yo be incurred to make an asset(intangibles) to current location and condition.
Its in accordance to IAS 38.Section A was alright except for some tricky questions.
Question 31 was a little tricky on my end with the ratios. I am not so sure about whether I had anything correct.
Question 32 was a good question. I was able to prepare a Statement of profit or loss with workings and the Statement of Changes in equity.
I totally messed up the first section C question (CBE version of F7), I panicked during the disposal of the sub. I messed up the calc totally which left me in a very bad mental space for the rest of the question. My interps were not well thought out, ratios miscalculated, gosh what a horrible experience. The problem was I was then left with 25 minutes to complete the last sec C question which I was more comfortable with, but I did not have enough time to finish the question…my SOCIE was half complete, I could not attempt the Case Flow extracts..what a shame, I could have gained 3 or 4 marks which I did not have time to even put something down for. Felt totally upset for days after, hence only posting now!!! Probable resit for me 🙁
Yup, totally agree: very wide syllabus and timing in the exam is everything. As a result, I did not practise enough past papers in any particular area. I panicked during beginning of section C (saw disposal of sub and lost it), which meant my timing totally went off. Spent far too much on first question of sec C (getting very little right) and then, had just over 20 min to complete the last question (single entity) which I could have scored far better in, and did not manage to complete the SOCIE and left out Cash Flow extracts (not time). Going to do Paper version next time, the CBE format for section C caused me to work more slowly…I feel more in control when I’m writing on paper and can make notes on the Question paper. If I have to resit F7, I’ll do the paper version. Still getting over disappointment of the whole experience! Was very upset after!
Did anyone please save the June 2017 questions? ACCA replaced the doc originally uploaded.
Depreciation is never capitalised……development costs are amortised due to they are intangible
Both depreciation and amortisation are expensed whatever the condition@mubeenjuma said:
Depreciation is never capitalised……development costs are amortised due to they are intangible
Both depreciation and amortisation are expensed whatever the conditionunder IAS 38 intangible asset depreciation is capitalised when production expenditure meers the PIRATE criteria
@kumboo said:
Did anyone please save the June 2017 questions? ACCA replaced the doc originally uploaded.Please anyone?
@chally said:
under IAS 38 intangible asset depreciation is capitalised when production expenditure meers the PIRATE criteriaWhich book says this maybe I can go check it up
@mubeenjuma said:
Which book says this maybe I can go check it upHi, its in the Kaplan study text. Read the chapter about intangible assets. theres also an exercise carried out to fully support this
@chally said:
Hi, its in the Kaplan study text. Read the chapter about intangible assets. theres also an exercise carried out to fully support thisThanks I’ll check it out
hope i did my exams pretty well. i found mcqs more easier ever. hope everyone did that part well. section c seems to be ok where you’ll be able to do it right with proper evaluation of question as it seems straight question but with some twists.
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