Investment property - ACCA Financial Reporting (FR)

Investment property - ACCA Financial Reporting (FR)
Free lectures for the ACCA Financial Reporting (FR) Exam
To benefit from this lecture, visit OpenTuition to download the notes used in the lecture and access all ACCA free resources.
Access to all Financial Reporting lectures, and Ask the ACCA Tutor Forums
Please go to opentuition to post questions to our ACCA Tutor, we do not provide support on youtube comments section.
** Complete list of free ACCA lectures is available on opentuition.com/acca/fr/ **

[@DeborahAOwach]

Lecturer looks great in his clean shave presenting the concepts. thanks for your clarity and conciseness

[@artanis5163]

Great video! I'm prepping for September exams. It helps quite well. Like for mentioning Liverpool 🤣🤣 Let's gooooo.

[@toastie_za]

I love this guy XD The burb had me dead

[@kushhinduja9444]

@OpenTuition Amendments to IAS 40 in 2009 specifically require Properties that are being constructed or developed for future use as investment properties to be accounted for as investment properties, even during the construction or development phase.

[@NyashaSamukange]

thank you there. I also saw that and was thinking the amendment had happened after this video had been made in 2018 but there are no recent amendments to the standard. clearly, they made an error

[@chrisbarlow3598]

We'll get it updated, just an oversight.

[@AbdulRauf-tk9ng]

Will it not give any Revaluation Reserve of $600 on SOFP??

[@kudakwashemunjeri4940]

Very detailed explanation

[@liebhardturi-khob4331]

Great explanation Thank you very much 👍

[@opentuition]

You are welcome!

[@pgforextraders2995]

As a Barcelona fan that call_ 10:00 really disturbed me

[@km-1867]

😅😅😅

[@RahulSharma-mp9bj]

We have an Investment property transferred from PPE. The initial FV revaluation was taken to OCI and subsequent revaluation to P&L. Now there is downward valuation in the IP. Can we set off this against the revaluation surplus created at the initial recognition of the asset as IP?

[@akilaweerasuriya899]

NO, It should be recognized as an expense in SPL.

[@nancyissoverycool2vave616]

can you talk about the "cost associate with re-organising the business operations following expected disposal of assets"? whether this includes in the calculation of 'value in use' or not, thanks

[@opentuition]

Please ask in the free Ask the Tutor Forum on our website. Our tutors do not monitor posts here but always answer posts in our Ask the Tutor Forums.

[@aburoujal]

Is company’s owned hotels will be treated as investment properties or PPE

[@opentuition]

Our tutors do not monitor posts here. Please ask in the Ask the Tutor Forum on our free website and then our Paper FR tutor will reply to you.

[@adnanghori6217]

Why didnt we write reveluation reserve of 1500 in SFP? Kindly answer im confused

[@opentuition]

Please ask in the Ask the Tutor Forum on our free website. Tutors do not monitor comments here.

[@bekarare]

Revaluation reserve is an unrealised gain. Gain - income, it is from SPLOCI. Because it is unrealized it appears in OCI.

[@samehmohamed3396]

Why investment property under fair value the property isn't depreciated while assets under IFRS 16 under revelations model the assets depreciated

[@yourfavoritechannel5498]

IAS 16 not IFRS 16.

[@samehmohamed3396]

Why??

[@megaziz444]

Because for revaluation model for IP, a revaluation is done at each reporting date , thereby gain or loss is recognised in P/L instead of OCI , thus depreciation is compensated with gain or loss this way. Correct me if i am wrong.

[@brightmind5345]

​@@megaziz444 I think the question should be, whether or no it is acceptable to recognize temporary revaluation surplus about?. for me I would account it as following, While the asset under IAS 16, I would depreciate it and recognize 500 thousand as depreciation expenses, reducing asset value to 19.5 million. meanwhile, I would recognize a revaluation surplus at another comprehensive income statement with value of 1.5 million. at the end of Dec, I will transfer all revaluation surplus amount to retained earning, and the 600 thousand I will recognize it as a profit after the asset now should be treated under IAS 40. and will be there no depreciation recognized since the asset under IAS 40 at 31july date, the date of recognizing cheaper headquarter.

[@megaziz444]

@@brightmind5345 m sure you have departed from the question asked on the accounting for depreciation under these two standards. And revaluation surplus can only be transferred to retained earnings when the revalued asset has been realised, so till then the revaluation surplus is parked under revaluation reserve under equity. If there is a switch from IAS 16 to IAS 40, you have to revalue based on ias 16 and the corresponding surplus will be accounted for in the reserves and will then be classified as ias 40.

[@linduwinahamunyela8873]

Why did you use 6months over 12 for depreciation while the building was reorganised on the 1st of july which is the seventh month and not the sixth month?

[@akilananayakkara]

That particular asset was used only 6 months fully as PPE due to transformation of that as IP after 1st of July.therefore We cant claim depreciation for July since the asset was not owner occupied on 1st of july.

[@dr.faithadhiambo254]

July,,august,,September,, October,, November,,, December,,,, those are 6months

[@yourfavoritechannel5498]

It's the start of the month.