Consider the following two independent scenarios:

Scenario A. Acehil owns and manages a consortium of apartments in the Edmonton Metropolitan Region. As part of a recent inspection by the fire department, Acehil has been mandated to upgrade the fire monitoring and sprinkler systems in 6 of their older buildings. In the 4 newer apartments, management decided to also upgrade the sprinkler systems. The total cost to bring all buildings to code is estimated to be $450,000. These costs must be completed by the end of the year.

Scenario B. Apexe Inc., a retail store, leases 5 stores in Eastern Canada. Each store is leased for a period of 10 years. The lease agreement requires that, at the end of the lease, Apexe Inc. return the store to its original condition. The 

work includes repairs to both the interior and exterior of the buildings. The cost of the repairs is estimated to be $60,000 per store. Apexe has an incremental borrowing rate of 5.75%.

Required:

1. Prepare a supported discussion around the requirements for each of the above scenarios. Include the proposed journal entries required for each of the above scenarios under IFRS.

2. Discuss the difference in reporting requirements under ASPE.