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IFRS 5 – NCA held for sale

Forums › ACCA Forums › ACCA FR Financial Reporting Forums › IFRS 5 – NCA held for sale

  • This topic has 3 replies, 2 voices, and was last updated 6 years ago by MikeLittle.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • April 19, 2016 at 5:56 pm #311748
    vuvietquang90
    Member
    • Topics: 36
    • Replies: 88
    • ☆☆

    Dear sir,

    I came across this obstacle, please make things clear for me sir 🙂
    ” Tourmaster PLC, a public limited company, has produced the following draft financial statements as at 31/03/2008

    NCA
    Ppe 900
    IA 200
    CA
    Inventories 80
    Trade receivables 120
    Cash and bank balances 42
    Ppe held for sale 28
    Total 1,370
    Equity
    Share capital 290
    Retained earnings 850
    CL
    Trade payables 150
    Income tax 80
    Total equity and liabilities 1,370

    Tourmastet had a ppty which it intended to sell on 31/03/2008
    The ppty is in a state of disrepair and atoutmaster intends to complete the repairs before it sells the ppty
    The repairs were completed on 28/04/2008
    The ppty was sold after costs for 28m on 15/05/2008
    The ppty was classified as held for sale at the year end at the net sale proceeds of 28m
    Before the reclassification as held for sale, the ppty was carried at 30m. Ppty is depreciated at 10% per annum using reducing bal method and no depreciation has been charged in the year

    I had CV as at 31/03/08 = 27m
    (30-30*0.1)
    Fv =28m
    So my thinking is followed to the lower of 28m and 27m, therefore the amount of ppty held for sale will be 27m
    But the answer didn’t revise the amount of ppty held for sale from 28m into 27m, instead it reclassify ppty held for sale (ca)into ppty (nca)with cost of 27m
    Can u explain for me why?

    From the date of reclassification until the sale was completed (31/03/08 -15/05/08) it’s still within 12 months , how can be reclassify like that?

    April 19, 2016 at 6:00 pm #311749
    vuvietquang90
    Member
    • Topics: 36
    • Replies: 88
    • ☆☆

    Or i think
    did it fail the criteria “available for immediate sale in its present condition” ????
    Then we must put it back the nca

    April 20, 2016 at 4:47 pm #311926
    vuvietquang90
    Member
    • Topics: 36
    • Replies: 88
    • ☆☆

    Help me sir 🙂

    April 28, 2016 at 7:51 am #312912
    MikeLittle
    Keymaster
    • Topics: 26
    • Replies: 22714
    • ☆☆☆☆☆

    If you want a guarantee that I shall read your posts and answer them, then you must post your questions on the Ask ACCA Tutor page, not in the general forum!

    You know this! You have posted sufficient number of posts on Ask ACA Tutor F7 page just recently …. and I’ve answered every one of them!

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