PAS 40 outlines the accounting treatment and disclosure requirements for investment properties, defining key terms such as carrying amount and distinguishing between investment property and owner-occupied property. It specifies measurement models, including the cost model and fair value model, and provides criteria for recognizing investment properties based on future economic benefits and reliable cost measurement. The document also addresses the disposal and retirement of properties, including gain/loss calculations and compensation for impaired or lost property.
PAS 40 outlines the accounting treatment and disclosure requirements for investment properties, defining key terms such as carrying amount and distinguishing between investment property and owner-occupied property. It specifies measurement models, including the cost model and fair value model, and provides criteria for recognizing investment properties based on future economic benefits and reliable cost measurement. The document also addresses the disposal and retirement of properties, including gain/loss calculations and compensation for impaired or lost property.
PAS 40 outlines the accounting treatment and disclosure requirements for investment properties, defining key terms such as carrying amount and distinguishing between investment property and owner-occupied property. It specifies measurement models, including the cost model and fair value model, and provides criteria for recognizing investment properties based on future economic benefits and reliable cost measurement. The document also addresses the disposal and retirement of properties, including gain/loss calculations and compensation for impaired or lost property.
PAS 40 outlines the accounting treatment and disclosure requirements for investment properties, defining key terms such as carrying amount and distinguishing between investment property and owner-occupied property. It specifies measurement models, including the cost model and fair value model, and provides criteria for recognizing investment properties based on future economic benefits and reliable cost measurement. The document also addresses the disposal and retirement of properties, including gain/loss calculations and compensation for impaired or lost property.
OBJECTIVE & KEY DEFINITIONS CLASSIFICATION SCOPE OF PROPERTIES Objective Carrying Amount (CA): Amount at which Prescribe accounting treatment and an asset is recognized in the statement of Investment Property: disclosure requirements for investment financial position (SFP). Land/buildings for rentals or property. Investment Property: Property generating appreciation. Scope income independently, held for rentals or PPE (per PAS 16): Applies to: capital appreciation. Equipment, machinery held for rental Recognition, measurement, and disclosure Owner-Occupied Property: Property used (non-land/building). of investment property. for production, services, or administrative Cell/radio towers, billboards. Excludes: purposes, classified under PPE (Property, Biological assets (IAS 41 and IAS 16). Owner-Occupied Property: Plant, and Equipment). Mineral rights and reserves (oil, gas, Used by employees or for business etc.). operations, classified as PPE.
MEASUREMENT MODELS Cost Model: JUDGMENTS IN COSTS EXCLUDED TRANSFERS Historical cost adjusted for depreciation and CLASSIFICATION RECOGNITION FROM CARRYING BETWEEN AMOUNT impairment. CRITERIA CATEGORIES Complies with IFRS 5 (NCA held for sale), IFRS Factors to Assess: Day-to-day servicing 16 (if leased), IAS 16. Whether property Recognize investment costs (expensed in P&L). Fair Value Model: qualifies as investment Change in Use: property if: property. Start-up costs unless Transfer when Annual updates to reflect current fair value in Future economic If acquisition is an asset necessary for intended property usage profit/loss. purchase or business benefits probable. use. changes to/from Gain/loss from fair value changes recognized in combination. Cost can be reliably Operating losses, investment P&L. Significant/insignificant measured abnormal wasted property. Rebuttable presumption of reliable FV ancillary services. resources. measurement.
DISPOSAL AND RETIREMENT PROPERTY HELD BY COMPENSATION FOR LESSEE Gain/Loss Calculation: IMPAIRED OR LOST Net disposal proceeds - CA recognized in PROPERTY Measure right-of-use asset initially at cost, profit/loss. Recognize third-party compensation in P&L when then per relevant measurement model. Remove revaluation surplus from OCI to receivable. retained earnings upon disposal.
