SIC-23
Historical
Property, Plant and Equipment–Major Inspection or Overhaul Costs
Addressed whether major inspection or overhaul costs of PPE should be capitalised or expensed, allowing recognition as a replacement component. Withdrawn in 2003.
Historical Reference
SIC-23 was withdrawn in March 2003 when the IASB issued a revised IAS 16 Property, Plant and Equipment, which superseded SIC-23 by incorporating major inspection cost treatment directly into IAS 16.14 and .70 as part of component accounting.
This page is retained for historical and comparative reference. Entities should refer to the current standard that superseded this interpretation for authoritative guidance.
Current Standard
IAS 16 Property, Plant and Equipment 1
What SIC-23 Addressed (Historical)
What SIC-23 addressed
SIC-23 addressed whether major inspection or overhaul costs of property, plant and equipment should be capitalised or expensed. It considered whether such costs should be recognised as a separate component of an asset if they were incurred to replace part of an asset, or whether they should be treated as repairs and maintenance.
2
The Conclusion It Reached (Historical)
The conclusion it reached
SIC-23 concluded that major inspection or overhaul costs should be recognised as a replacement component of an asset, capitalised as part of the carrying amount of the asset, if the conditions for recognition were met. The cost should be depreciated over the intervals between inspections or overhauls, and any remaining carrying amount should be derecognised when the asset is inspected or overhauled.
3
Where This Guidance Lives Today
Where this guidance lives today
Superseded byIAS 16 Property, Plant and Equipment
Why withdrawnThe 2003 revision incorporated major inspection cost treatment directly into IAS 16.14 and .70
Current statusWithdrawn
Glossary
Component accounting
An approach under IAS 16 where an entity separately depreciates significant parts of an item of property, plant and equipment.
Inspection cost
A cost incurred to determine whether major servicing is required, or a cost that is part of a planned major inspection programme.
Financial statement key
BS Balance sheet
IS Income statement
SE Statement of changes in equity
OCI Other comprehensive income
SCF Statement of cash flows
History & Development
Jan-2000
In January 2000 the Standing Interpretations Committee issued SIC-23 Property, Plant and Equipment–Major Inspection or Overhaul Costs.
Apr-2001
In April 2001 the International Accounting Standards Board adopted SIC-23.
Minor consequential amendment to SIC-23
Mar-2003
In March 2003 the Board issued a revised IAS 16 Property, Plant and Equipment which superseded SIC-23.
Superseded by revised IAS 16