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that same property has been the subject of an earlier upwards revaluation, then this subsequent revaluation deficit will be debited to the Revaluation Reserve in so far as the balance in that reserve matches the downwards revaluation
Any excess over the relevant figure in the Revaluation Reserve will be debited to other comprehensive income
OK?
Sir, that is your reply on a question tagged Leasehold property posted on December 2017.
About your last statement of excess deficit going to Other Comprehensive Income, I thought that it should be taken to Statement of Profit or Loss.
Clarify please!
Are you sure that this is a thread dealing with leasehold property?
When an asset is carried under the valuation model, any decrease in fair value that exceeds previous upwards revaluation surpluses in the Revaluation Reserve should be treated as expenses in so far as they exceed those earlier surpluses
If I have responded by stating that that surplus deficit should be debited to other comprehensive income, it’s because I have previously treated statements of profit or loss and of comprehensive income as a single statement rather than as two separate statements … as is allowable presentation
But under IAS 16, any excess deficits over previous revaluation surpluses should be expensed – if we’re preparing financial statements showing separate statements for profit or loss and for other comprehensive income, then the expense will go through profit or loss
If we’re showing a single combined statement, then the expensing of the excess deficit will be within the profit or loss section of the combined statement
Is that better?
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