How is the revaluation of an investment property treated differently from the revaluation of an item...

How is the revaluation of an investment property treated differently from the revaluation of an item of property, plant and equipment?

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1	The big difference is where there is a gain in the value of an asset
2	If it’s an investment property, that gain will go through profit or loss whereas if it’s a gain for a non-investment asset held under the valuation model the gain will be credited to a revaluation reserve.
3	Treatment of losses – investment property the loss goes to profit or loss
4	If it’s a non-investment property held under the valuation model the loss goes initially against earlier surpluses still in revaluation reserve and then any excess is expensed through profit or loss.
5	Depreciation is different.
6	Treatment of gains is different (as I have just pointed out).
7	Treatment of losses is also different (again, as I have just pointed out)
8	Different from revaluation model used for PPE. In revaluation model, if fair value is more than historical cost, no gain is reported in income statement.
	For investment property, the gain is recorded in the income statement and there is no revaluation surplus account.

ekkarill92 answered 1 year ago

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