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Dear Sir,
I have read IAS 40 regarding investment property; however, I am concerned about some points:
1/ Is it correct that Investment property be land or building?
2/ I don’t see the difference between the recognition of IAS 16 and IAS 40. Does it mean IAS 40’s purpose is to classify the land or building as the investment property based on its purpose is capital appreciation and/or rental
3/ I understand the difference between IFRS 16 – Lease and IAS40 is when the lessee leased out the property that have rented from other entity, the right-of-use-asset may subject to revalued to fair value (if they choose to apply fair value method). However, IFRS 16 does not specify the fair value method for the right-of-use of asset? Is my understanding correct?
1. Land and/or building.
2. Only IP if, as you say, purpose of holding is for investment purposes. Not IP if owner occupied.
3. Sub-leasing creates endless complications. I don’t think that the intermediate lessor would ever revalue the right of use asset in practice. There is a discussion in the link below but it doesn’t get as far as considering revaluations – so I wouldn’t worry about it.https://www.bdo.nz/en-nz/ifrs-16-creates-complexity-in-subleasing-arrangements
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