I am preparing some FS for a property company that in the prior year held a property within fixed assets at market value. The gains/losses on revaluation were taken to the revaluation reserve as the entity reports under FRSSE.
The property is now no longer held for investment purposes and is being developed with a view to sale. Consequently it seems appropriate to reclassify the property to stock.
Ignoring the tax implications of this which I've already dealt with, what value should the property be transferred to stock at? Clearly stock would normally be held at the lower of cost / NRV but it seems odd to have to reverse any revaluation gain arising in prior years. Should it be transferred at market value instead?
Any help would be much appreciated.