Financial Reporting Standards Rules for Fixed Asset Revaluation
An entity may adopt a policy of revaluation tangible fixed assets. Where this policy is adopted it must be applied consistently to all assets of the same class.
A class of fixed assets is a category of tangible fixed assets having a similar nature function of use in the business of an entity.
Where an asset is revalued its carrying amount should be its current value as at the balance sheet date current value being the lower of replacement cost and recoverable amount.
To achieve he above, the standard stats that a full valuation should be carried out at least every five years with an interim valuation in year3. If it is likely that there has been a material change in value, interim valuation in year 1, 2 and 4 should also be carried out.
A full valuation should be conducted by either a qualified external value or a qualified internal value, provided that the valuation has been subject to review by a qualified external assessor. An interim valuation may be carried out by either an external or internal assessor.
For certain types of assets, there may be an active second hand market for the asset or appropriate indices may exist, so that the directors can establish the assets value with reasonable reliability and therefore avoid the need to use the services of a qualified assessor.
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