Investment property revaluation in accounts

Investment property revaluation in accounts

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Company has investment properties let to commercial enterprises. I believe that having adopted a fair value method of reporting and used previous valuations it should be applied consistently with relevant properties revalued annually. Company has valuation reports confirming uplift in values from previous year but has not adjusted as not material in their view. Uplift is 8% of assets value, 20% of shareholders funds and 200% of profit for year. Is materiality a factor?
steven grey

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By User deleted
27th Nov 2007 15:57

Not an excuse
You are right to state that they should reflect latest values in their balance sheet and 20% of net assets is fairly significant .... I would suggest this is material. (I would also suggest that comparisons to profit are not relevant as the uplift does not pass through the P&L under UK GAAP).

However, they probably realise that values are now falling away post balance sheet so maybe prudence is in their minds?

Reiterate reporting standards to the Directors to see if you can change their mind?

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