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Ind As 40 Revision Notes HW

1. IND AS 40 provides guidance on accounting for investment property, which is property held to earn rentals or for capital appreciation rather than for sale in the ordinary course of business. 2. Investment property is initially measured at cost and subsequently measured using the cost model, with no option to use the revaluation model. Fair value is only disclosed. 3. Transfers to or from investment property involve assessment of change in use, such as commencement or end of owner occupation or development for sale.

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38 views

Ind As 40 Revision Notes HW

1. IND AS 40 provides guidance on accounting for investment property, which is property held to earn rentals or for capital appreciation rather than for sale in the ordinary course of business. 2. Investment property is initially measured at cost and subsequently measured using the cost model, with no option to use the revaluation model. Fair value is only disclosed. 3. Transfers to or from investment property involve assessment of change in use, such as commencement or end of owner occupation or development for sale.

Uploaded by

Satish Verma
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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IND AS 40 INVESTMENT PROPERTY 7 hand Building land Building

Heldfor rentals on capital Appreciation

if Lord Building is held for Business use then apply Ind As 16

Apply lost model for Investmentproperty initially and subsequently


No concept of Revaluation model
However for Disclosure purpose fail value is determined
Examples of Investment property

I land held for long term capital appreciation rather then short term sale
4 land Held for currently undetermined future use capital appreciation
3
A Vacant Building held to leased out under finance operating lease
4 Property being constructed fdeveloped for future use as Inu property

following are not Investment ddopanty Ind as 2 Inventories

Y Property acquired with a view to subsequent disposal in near future


sell kerne ke liye
Ad for development and resale BuyKiya
f
BuyKiya bindevelop Kathe sell banga
2 owned occupied property Business use Ind as 16 PPE

3 Property heed for future use as owned occupied property


4 Property held fon future development and subsequent use as owned
occupied property

5 Property occupied by employees whether Rentpaid at market rates


Property held for more than one purpose

When property held partly bad Rental Capital appreciation and partly
for Prod supply ofhoods services on Admin purpose the two parts
accounted separately if sold ceased under finance lease separately

Example
out of 15 floors 10floors held for Rentals 3 floods held for
Prod 2 floors held for Admin purpose
if Each floors can be sold financelease separately then Accounting
is done as follows
1st 10 floods 3 floors 2 floors
Investment property owner occupied property owner occupied property

if Cannot be sold fleased under Finance lease separate they accountentirely as owner
occupied property

It only insignificant portion used for prod supply they accountas Investment property

Ancillary services I e.g security and maintenance service


Investmentproperty I
g if services are Insignificant then securityservices
provided in an appointment building

if services are significant then owner occupied property 1Hotel service

Property leased to other Group members

Consolidated F s y owner occupied property


Separate Fls of Investment property
RECOGNITION CRITERIA Investmentproperty recognised as an asset when
a Probability of FEB b cost measured reliably

Reval model not


Initial Measurement Almostsame as ind As 161 Except that
followed in Ind
As no
measured initially at its cost Any Transaction cost are included
cost includes Purchaseprice Directly attributable lost taxes legal fees
professional fees property transfer tax

lost not included startup lost operating losses Abnormal wasted material
labour other Resources

subsequent measurement a depriciable


asset
Building is
measured at cost Depaiciation if applicable Impairmentloss if any
No Revaluation model

DAY TO DAY SERVICING COST recognised in PIL


lost concept same as Ind As 16
Replacement

Deferred Payments 7 Same as Ied As 16

Exchange of Assets 7 Same as Ind As 16

FAIR VALUE MEASUREMENT FOR DISCLOSURE PURPOSE

An Entity is Encouraged to measure fairvalue by Independent valuer


There is Rebuttable presumption that fair value can be measured
reliably
In few situation fail value not reliably measurable
TRANSFERS prop to ownedoccupied Inventory or
Investment

vice versa
only when there is Evidence of change in
Change occurs use

Mere change in management's intention does not provide evidence


of change in use Action needed

Examples Action Action


1 Transfer from Inu prop to owned occupied commencement of
owned occupation on Development for owned occupation
2 Transfer from Inu prop to Inventories Commencement
of
development for sale

LaganInu property ko direct classify kina as held for sale


without Development then Ind As 105 applies

3 Transfer from owner occupied property to Inv prop End of


owned occupation

4 Transfer from Inventories to Inu prop Inception of operating lease

DISPOSAL Eikance
lease
Investmentproperty is derecognised on Disposal or when Inv prop

is permanently withdrawn from future use and NO FEB Expected


Gainsflosses net sale proceeds carrying Amount
I recognised in PIL

Denecognition of Replaced parts same concept as Ind As 16

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