Revaluation surplus
A revaluation surplus is an equity component that normally records an upward revaluation recognised in other comprehensive income. Keep the surplus as a separate equity component and show movements in the statement of changes in equity. An increase is not a cash receipt. On use or disposal, a transfer to retained earnings may be permitted, subject to the relevant rules; it is not automatically mandatory.
Worked example
An upward revaluation of 100 with no previous relevant loss adds 100 to surplus.
Common mistake
An increase first reverses a previous loss recognised in profit or loss to that extent; decreases have corresponding rules.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | FA | Direct | September 2026–June 2027 |
| ACCA | FR | Direct | Official assessment-window verification pending |
| ACCA | K1 | Direct | July 2027–August 2028 |
| CIMA | BA3 | Direct | Official assessment-window verification pending |
| CIMA | F1 | Direct | Official assessment-window verification pending |
| FIA | FFA | Direct | September 2026–June 2027 |