What's the correct treatment in this case.
Part of a parcel of land and buildings has been sold. Prior to being sold the property was valued in its entirety and deemed to be slightly less than the carrying value in the books.
Now I'm looking at producing the entries in the books that sort this lot out. So how to do it.
Would you apportion the revaluation reserve according to the valuation and move to P&L reserve that bit related to the property sold, or would you revalue the properties down first to the new valuation before apportioning.
Or doesn't it matter in the grand scheme of things.
I just find it a bit strange posting a loss on disposal to the P&L followed by a large capital gains tax provision.
Neil Wilson
