During 2021 the IFRS Interpretations Committee (the IFRIC) considered the accounting treatment of non-recoverable VAT by lessees. The committee decided not to issue explanatory guidance or undertake standard setting activities in this regard. The accounting treatment of non-recoverable VAT does however seem to be contentious, even if its effect is not necessarily material and does not result in widespread diversity. This article highlights the areas that the comment letters submitted to the IFRIC and the commentary published by accounting firms suggest require some interpretation.
Source Pieter van der Zwan
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