Revaluation of land and buildings

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I have a client who has land and buildings. In 2019 the land was revalued downwards and the buildings revalued upwards to it's original cost under the 'depreciated replacemen cost basis'. Their previous auditor's advised them the land revaluation goes through the revaluation reserve and the buildings revaluation through the profit and loss reserve. In 2021, the buildings were revalued upwards again to it's original cost under the depreciated replacement cost basis after two years' of depreciation (the land valuation did not change). Can anyone point me to the standard which says this is correct? Anything I have read confirms both should go through a revaluation reserve. Many Thanks for your help in advance

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By paul.benny
06th Oct 2022 10:21

FRS102, specifically s17.15E/F deals with accounting for revaluation gains/losses. The prior treatment does not seem to make sense - revaluations go through Other Comprehensive Income or P&L - they've not gone directly to reserves for years.

The Standard can be downloaded for free from the FRC website.

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Replying to paul.benny:
By thomasallen629
06th Oct 2022 12:02

Thanks, I agreed but just trying to find rationale for the previous auditors treatment and can't do!

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By Bobbo
06th Oct 2022 14:31

Are the 'buildings' on the 'land'? I.e. these are the same asset, albeit different components of such?

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