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Stephen Widberg.
Stephen Widberg.-
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jareerabedin
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Dear sir,
Isn’t the main reason for classifying an asset under IAS 40, is that the asset should be held for rental payments or for Capital appreciation.However, in this question, they don’t mention that. Can you help me understand this? Whenever, there is a change in the application from IAS 16 to IAS 40, shouldn’t I mention the above requirement?
I’m trying to understand how a change in use from an office building to an industrial unit justifies classifying from PPE to Investment property. I thought industrial units are where good are made, so how are they being held for capital appreciation or rental income?
Thanks
Stephen Widberg
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Your logic sounds fine.
If they a business occupies property – PPE
If you don’t and you rent the property out – IP
Exam question normally makes this clear.
I don’t recognise the name Canto as a current syllabus question- tell me if I’m wrong.
jareerabedin
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