What is the treatment of revaluation of fixed asset in financial statements? How do we treat the depreciation on revalued figure? Is there any new update on this with IFRS?

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Fixed assets is 400000 accumulated depreciation 100000 salvage value 100000 f...
Posted by:
Ahmed kandil
21-March-2015

Asset Allocation Financial Reporting IFRS Finance

Question added by Renu Jajoo , Finance Manager , Pyramid Pharma Limited
Date Posted: 2016/04/15

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by Sherif Mansour CMA , general finance manager , Scape Restaurant & Lounge - Burj Al Arab

Long-lived assets are recorded at historical cost or revalued amount(fair value).IAS NO 16.

This a very good question and still faced big challenged in todays financial world, IFRS said what mentioned above and FASB before request from the big company in USA, to provide a memo with financial statements to show the replacement cost of assets (current price)today, but I thing this will be complicated and depreciation expense will become huge and decrease profit.

On the other hand the company didn't pay the current or market price today! But paid the historical cost appeared in the books.

What is your opinion Renu Jajoo?

Regards,

sherif

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