Question：IAS 40 covers investment properties.
 
Which one or more of the following is true of IAS 40?
 
A. If a company owns a whole building, but occupies 25% of it, the remaining 75% can be treated as investment property.
 
B. Investment property does not need to be depreciated.
 
C. Investment properties must be revalued every year.
 
D. Investment property cannot include assets held on finance leases.
 
The correct answers are: AB
 
An investment property can now include assets held on finance leases (this was a recent change). It can also be part of a property. Investment properties do not need to be depreciated, but can be held under the fair value model (which requires annual revaluation) or the historic cost model, which requires changes in value only if there is evidence of an impairment loss.
 
The cost model requires the property to be carried at historical cost less accumulated depreciation less impairment losses.


 
展开全文