PPE – Property Plant & Equipment

PAS 16

PPE Measurement is at cost.

Subsequent Measurement;

Cost Model – the asset is carried at it’s cost less any accumulated depreciation and any accumulated any impairment loss.

Revaluation  Model – the asset is carried at revalued amount, being it’s fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent impairment losses. Revaluation will be done every 3 – 5 years or every one year regularly.

*Regardless of model any accumulated depreciation and impairment losses recognized. In choosing the measurement is one time decision and cannot be change later.

If a revaluation results in an increase in value, it should be credited to equity under the heading “Revaluation Surplus”, unless represents reversal of previous expense.

A decrease arising as a result of revaluation should be recognized as expense to the extent of surplus.

*Realization of surplus, if asset is non-depreciable upon disposal.

 

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About Jonathan Ruiz CPA

Newbie Mentor and one of the influential author in the Philippines setting. His also the founder of PAM Academy and Developer of PAM PSE TRACKER application.
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