FINANCIAL STATEMENTS AND IFRS 6

Financial Statements and IFRS 6



Financial Statements and IFRS 6

Assessment for the development and evaluation of mineral resources

IAS (IFRS) 6 permits the company to apply the existing accounting policies for the development and evaluation of mineral resources. This policy may apply even if it does not coincide with the treatment of such costs, consideration of existing IFRS (Cortese, 2009, Pp. 76). 

The company wishing to make changes to its accounting policies, may do so only if the result of these changes in accounting policy the company will be more consistent with the treatment of such costs in accordance with IFRS and with the Principles of preparation and reporting. Intangible assets include the costs of obtaining the rights for exploration and evaluation of mineral resources, the acquisition of licenses for various activities in specific areas. In addition, they include costs associated with the consumption of tangible assets in the works, as well as salaries of personnel associated with the consumption of the material resources. Tangible assets used in this case are presented as the material until the complete cessation of their recognition in the balance of the organization.

Reclassification of assets for exploration and evaluation of mineral resources must be made after receipt of reasonable evidence of technical capability and commercial viability of the explored deposits of raw materials. In this case, the assets of the exploration and evaluation go to a class of initial development costs of explored mineral deposits (Irvine, 2007, Pp. 1).

Scope

The assessment of technical feasibility and cost of extraction of mineral resources before making a decision on the development of mineral resources.

IAS (IFRS) 6 does not apply to:

(A) Costs arising from the exploitation of mineral resources after a specified return on deposits. (B) Expenses incurred by the company before it was obtained the right to development.

IAS (IAS) 16 and IFRS (IAS) 38 on the development and manufacture of fixed and intangible assets with a view to their subsequent use for the development and evaluation of mineral resources shall continue to apply. The main tools used for the operation of the company to develop and evaluate the mineral resources (assets), continue to be considered in accordance with IFRS (IAS) 16.

Recognition and initial assessment of the costs of development and evaluation of mineral resources

IAS (IFRS) 6 permits the company to apply the existing accounting policies for the development and evaluation of mineral resources. This policy may apply even if it does not coincide with the treatment of similar costs addressed by existing IFRS, or with the principles of preparation and reporting of IASB.

The company wishing to make changes to its accounting policies, may do so only if the result of these changes in accounting policy the company will be more consistent with the treatment of similar expenses in accordance with IFRS and with the Principles of preparation and reporting of IASB (ie . enterprise should be guided by the requirements of IFRS 8 in respect of changes in accounting policies) (Bryant, 2003, ...