13 analyze and interpret financial statement

13. Analyze and interpret financial statement
disclosures regarding property, plant, and equipment
and intangible assets.
b. Three useful calculations
14. Compare the financial reporting of investment
property with that of property, plant, and equipment.

b. IFRS give choice of using method when value
investment property and disclose the method,
but must use the same valuation model for all
investment property.
i. Cost model the same for value PPE, must
disclose the fair value along with other
disclosures for LLA.
ii. Fair value, if reliable, must stat how
determine fair value and reconcile
beginning and ending value.. Differ from
revaluation model. For revaluation model
,any revaluation above historical cost is
recognized as revaluation surplus in owner’s
equity. For investment property, revaluation
above historical cost is recognized as gain in
P/L.
c. firm may change use of property that it become
investment property or no longer classified as
investment property. If use fair value mode, the
fin. State. Treatment of the assets’ value
depends on nature of the change (table 2) , if
use cost model, the carrying amount doesn’t
change when it is transferred into or out of
investment property
Transfer
from
Transfer to Fin. State. treatment
Owner-
occupied
Investmen
t property
As revaluation:
recognize gain only if it
reverses previously
recognized loss

inventory Investmen
t property
Recognized gain or
loss if fair value is
different from carrying
amount
Investment
property
Owner-
occupied
or
investmen
t
Fair value of asset at
date of transfer will be
its cost under new
classification.