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Deloitte comment letter on tentative agenda decision on IFRIC 21 — Levies raised on production property, plant, and equipment

Published on: Nov 25, 2014

Deloitte's IFRS Global Office has com­mented on the IFRS In­ter­pre­ta­tions Com­mit­tee ten­ta­tive decision not to take onto the Com­mit­tee’s agenda a request for guidance on whether the cost of a levy raised on production property, plant, and equipment is an administrative cost to be recognized as an expense when incurred or a fixed production overhead to be recognized as part of the cost of inventory.

Deloitte's IFRS Global Office agrees with the IFRS In­ter­pre­ta­tions Com­mit­tee’s analysis of IFRIC 21, however, the letter suggests that the wording on "matching costs" be deleted and replaced with the following:

“The Interpretations Committee noted that, consistent with the decision noted in paragraph BC14 of the Basis for Conclusions on IFRIC 21, it would be inappropriate to address the treatment of costs of a levy in the context of an interpretation of a standard that deals only with the recognition and measurement of liabilities.”

Download the full comment letter below.


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