Hello Sirs
How to account in balance sheet or legally ,concealed money when prepared deed for land sale/ purchase. How to manage if full amount through bank a/c?
for eg. Original property value is
Rs 1 crore; as per deed Rs. 70L only,
how to account/ manage balance 30L in both sides ( seller and buyer). Expect reply from experts ASAP
thanks to all.
Revaluation of assets is one of the way to capitalise your, valuation.
Revaluation Model
Under Indian GAAP, AS 10 recognises revaluation of fixed assets. However, the revaluation approach adopted therein is adhoc in nature. It provides that when revaluations do not cover all the assets of the given class, it is appropriate that the selection of the asset to be revalued be made on a systematic basis, e.g., an entity may revalue a class of assets within one unit and ignore assets in the same class of another unit.
If the entity adopts the revaluation model under Ind AS 16, items of PPE whose fair value can be measured reliably are carried at a revalued amount, which is their fair value at the revaluation date less any subsequent accumulated depreciation and accumulated impairment losses. Ind AS 113 Fair Value Measurementis used to arrive at the fair value of the PPE. Though Ind AS does not mandate use of valuation professionals for arriving at fair value; in practice, entities obtain their help for arriving at fair value.
If an item of PPE is revalued, the entire class of PPE to which that asset belongs should be revalued. Ind AS 16 does not allow any pick and choose from a class of PPE for revaluation purposes. A class of PPE is a grouping of assets of similar nature and use in an entity’s operations. Examples of separate classes are: land and buildings; machinery; motor vehicles; furniture and fixtures; and office equipment.
If an asset’s carrying amount is increased as a result of revaluation, the increase is recognised in other comprehensive income (OCI) and accumulated in equity under the heading of revaluation surplus. However, the increase is recognised in P&L to the extent that it reverses a revaluation decrease of the same asset previously recognised in P&L.
CAclubindia
