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IAS 16 Fair value higher than book value


What is the treatment if the Fair value is higher than the book value.

asked Nov 7, 2016 in IAS 16 - Property, Plant and Equipment by Ahmed Wazeer

2 Answers

+1 vote
According to IAS 16,there are two method of treating the items of PP&E ;

- Cost model

-Revaluation model

under Cost model, an item of PP&E will be recorgnized at cost less any accumulated depreciation and  accumulated impairment loss.

under revaluation model,  the fair value/revaluation amount will be used to recognized the item of PP&E . The increase in the carrying amount as a result of fair value shall be recognized in other comprehensive income as Revaluation surplus.
answered Nov 8, 2016 by majorprof
0 votes
The fair value/revaluation amount will be used. The increase in the carrying amount as a result of fair value shall be recognized in other comprehensive income as Revaluation surplus.
answered Nov 12, 2016 by sheroze1 Level 2 Member (3,000 points)


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