Sarmiento, Jefferson D.

List down 5 things you've learned from IAS 40. Explain briefly
1. I have learned that IAS 40 or the Investment Property applies to the accounting for
property such as land and/or buildings held to earn rentals or for capital appreciation (or
both). Investment properties are initially measured at cost and, with some exceptions.
May be subsequently measured using a cost model or fair value model, with changes in
the fair value under the fair value model being recognized in profit or loss.
2. Also, if the owner uses part of the property for its own use, and part to earn rentals or
for capital appreciation, and the portions can be sold or leased out separately, they are
accounted for separately. Therefore the part that is rented out is investment property. If
the portions cannot be sold or leased out separately, the property is investment property
only if the owner-occupied portion is insignificant.
3. I have learned that Investment property is remeasured at fair value, which is the price
that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. Gains or losses
arising from changes in the fair value of investment property must be included in net
profit or loss for the period in which it arises.4. A grant receivable as compensation for
costs already incurred or for immediate financial support, with no future related costs,
should be recognized as income in the period in which it is receivable.
5. Lastly, If an entity determines that the fair value of an investment property under
construction is not reliably determinable but expects the fair value of the property to be
reliably determinable when construction is complete, it measures that investment
property under construction at cost until either its fair value becomes reliably
determinable or construction is completed.