AASB 123 - Borrowing Costs - July 2004
B.3 Identifying borrowing costsB.3 Identifying borrowing costs
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B.3 Identifying borrowing costs
Both AASB 123.5 and AASB 1036.11.1.2 comment that borrowing costs include, amongst other things, interest on bank overdrafts and short-term and long-term borrowings, amortisation of discounts or premiums relating to borrowings, and amortisation of ancillary costs incurred in connection with the arrangement of borrowings. AASB 1036.11.1.3 to 11.1.6 provide additional guidance on some of the items that would be regarded as falling within these types of borrowing costs. For example, AASB 1036.11.1.3 comments that, when borrowings have been discounted to determine their carrying amounts, the increase in those carrying amounts resulting from the expiry of time is in the nature of interest. AASB 123 does not include this additional guidance in its text.