IFRIC 18 - Transfers of Assets from Customers
- Published in the Official Journal
- Isabel Batista
In January 2008, the IFRIC published D24 addressing Customer Contributions.
In December 2008, the IFRIC concluded its deliberations on D24 and published a final Interpretation on 29 January 2009 - IFRIC 18 Transfers of Assets from Customers. IFRIC 18 addresses the accounting for arrangements in which an entity receives from a customer an item of PPE (or cash to construct or to acquire an item of PPE) that the entity must then use either to connect the customer to a network or to provide the customer with on-going access to a supply of goods or services (such as a supply of power, gas or water) or both. It is expected that IFRIC 18 will mostly impact the utility sector. However, the scope of IFRIC 18 is not limited to the utility sector and other industries and arrangements that might be impacted include telecommunication companies and outsourcing arrangements.
IFRIC 18 shall be applied prospectively to transfers of assets from customers received on or after 1 July 2009. Earlier application is permitted provided that the valuations and the information needed to apply the Interpretation was available at the time the transfers were made.
EFRAG has issued its endorsement advice and the IFRIC has now been published in the Official Journal.