Ind AS - 023 - Borrowing Costs

Borrowing costs capitalisation: directly attributable borrowing costs must be capitalised to qualifying assets, with disclosure of amounts and rate.

Borrowing costs directly attributable to acquiring, constructing or producing a qualifying asset must be capitalised as part of that asset's cost; other borrowing costs are expensed. Eligible capitalised costs include interest and specified related items; for specific borrowings the actual borrowing costs less investment income on temporary investments are capitalised, while for general borrowings a weighted average capitalisation rate is applied to expenditures. Capitalisation begins when expenditures, borrowing costs and preparatory activities commence, is suspended for extended development stoppages, and ceases when substantially all activities to ready the asset are complete. Entities must disclose capitalised amounts and the capitalisation rate.