IFRIC issues draft interpretation D2
04 Sep 2003
The International Financial Reporting Interpretations Committee has issued Draft Interpretation D2 'Changes in Decommissioning, Restoration and Similar Liabilities'.
Under IAS 37 Provisions, Contingent Liabilities and Contingent Assets, a provision must be recognised when an asset is acquired if the acquirer is obligated to incur costs for decommissioning, restoration, and similar future activities. The costs are included as part of the cost of the asset.
The proposed Interpretation deals with accounting for subsequent changes in the estimated cash flows relating to the provision. The proposed Interpretation concludes, among other things, that decommissioning, restoration, and similar liabilities should be remeasured at each balance sheet date using a current market-assessed discount rate.
Comments are due by 3 November 2003. Click for:
- More Information about D2
- Press Release (PDF 24k)
- Full Text of D2, which can be downloaded from IASB's website without charge starting 5 September.
