- This topic has 3 replies, 2 voices, and was last updated 10 years ago by
.
-
Posts
-
In the OpenTuition Lectures provided, there was a statement in chapter 7:
“Any upward revaluation should be credited to a revaluation reserve. Any downward revaluation should be charged as an expense in the Statement of Proft or Loss.”
1) Does this mean that, regarding the reporting in the SOCIE, there will be a gain for an upward revaluation but NOTHING for the downward revaluation?
2) What will be the Dr entry for the downward revaluation? For the expense.
3) Where will this expense be found in the SOPL? Is it under Other Expenses? As opposed to Other Comprehensive Income where the Upward Reval. will have a place in the SOPLOI?
4) This isn’t really a question – I would just like to thank you immensely for answering my tedious questions so succinctly, and also request you to bear with me for hardly a week more (concerning this subject at least) until I take my paper. I seriously consider myself lucky to have you solve my quandaries in this crucial time. *Salutes*
You will not have a downward revaluation in Paper F3.
As far as Paper F3 is concerned, revaluing downwards is effectively just charging higher depreciation – which is an expense in the Statement of profit or loss.
(It does effectively appear in the Statement of changes in equity, but not as a separate item – it means there is less profit, and the profit is what appeared in the SOCIE)
- You must be logged in to reply to this topic.