I am building a factory and it is in construction on progress.

Question

I have a supplier account directly tied to this and it has exchange rate difference loss. What should i do with exchange rate difference? Capitalize or Expense? There is not any interest expense.

Answer 1

Expense it in the period it arises!
Read IAS 21.28:
"Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition during the period or in previous financial statements shall be recognised in profit or loss in the period in which they arise.."