If a company chooses the revaluation model permitted in IAS 16 for fixed asset measurement:
A) annual revaluations must be performed on each class of assets.
B) it must update the valuation so that the balance sheet represents fair value on the balance sheet date.
C) appraisals must be performed by an official of the IASB.
D) the depreciated replacement cost must be used as the fair value of the fixed asset.

Question

Quizplus · Accepted Answer

If a company chooses the revaluation model permitted in IAS 16 for fixed asset measurement, it must update the valuation so that the balance sheet represents fair value on the balance sheet date. However, there is no requirement for annual revaluations or for appraisals to be performed by an official of the IASB, and the depreciated replacement cost is not necessarily the fair value of the fixed asset.

If a Company Chooses the Revaluation Model Permitted in IAS