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Hi Sir,
I refer to Example 1 from Chapter 9.
When we did the revaluation,the depreciation charge on the revalued asset was different to the depreciation that would have been charged based on the historical cost of the asset.
I understand that IAS 16 permits a transfer to be made of the amount equal to the excess depreciation from the revaluation reserve to retained earnings, however this was the first time the asset was being revalued. There was no reserves, therefore why did we still do a transfer for the excess depreciation from OCI to Retained Earnings?
Regards,
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