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ias 16
1. in accordance with IAS 16 PPE, an entity may choose to make an annual transfer of excess depreciation from revaluation reserve to retained earnings. However my question is how an can result into excess depreciation… ?
2. moreover, this annual transfer refer to class of assets (like revaluation model) ? or simply just an ‘item’ ?
ifrs 15
in accordance with IFRS 15, an entity controls an asset if it can direct is use and obtain most of its remaining benefits. This control have indicators which are
1. entity has a present right to payment for the asset
2. customer has legal title to the asset
3. entity has transferred physical possession of the asset
4. customer has significant risks and rewards of ownership of the asset
5. customer has accepted the asset.According to Kaplan textbooks, there are five indicators for the transfer of control. Does this mean that this all five has to be met ? or just one among the five to conclude that the control has been transferred ?
1. The asset is revalued upwards, so has a higher value and so a higher depreciation charge than was previously charged.
2. It will only apply to those revalued assets and is a policy that the company can choose to do or not, but it should be consistent.
3. Any of them, as they are indicators.
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