Page 223 - F1 Integrated Workbook STUDENT 2018

IAS 20 Government Grants and IAS 40 Investment Properties

2.2 Accounting treatment

IAS 40 Investment Property gives a choice between the following.

Fair Value Model
Cost Model
 The asset is revalued to its
Under the Cost Model the asset
should be accounted for in line fair value at the end of each
year
with the cost model laid out in

IAS 16 Property, Plant and  The gain or loss is shown
Equipment. An entity that directly in the statement of
chooses the cost model must profit or loss

disclose the fair value of its  No depreciation is charged
investment property. on the asset

Once the model is chosen it should be used for all investment properties.

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