Holding costs

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In accounting for inventories under IAS 2 storage or holding costs are generally expensed as they are incurred unless:

  • storage is necessary before a further stage in the production process,
  • the inventory is produced as a discrete project – e.g custom-built furnishings when the storage will be charged to the customer, or
  • the inventory requires a maturation process to bring it into a saleable – e.g. whiskey, wine or cheese.
IFRS Synonyms:
Storage and holding costs, Storage and holding cost, Storage cost, Storage costs