09-D, “Application of Topic 946, Financial Services—Investment Companies, by Real Estate Investment Companies.” Due Process Documents investment property accounting problems; Finance. Page 1 of 4 FAR.2908 FAR OCAMPO/OCAMPO FAR.2908-Investment Property DISCUSSION PROBLEMS 1. Accounting treatment under FRS 102 . As part of this project, the Board also plans to address Emerging Issues Task Force (EITF) Issue No. This site uses cookies. Using a straight line depreciation method for a commercial property costing $2 million dollars, for example, you would receive … theory discussion notes – related link (please click the button. Back to Course Next Lesson. IAS 40 Investment Property Overview. When preparing financial statements, it is easy to get confused between what is an investment property and what is property, plant and equipment (PPE). This distinction is important because if we incorrectly classify a property at the outset, the accounting that follows will also be wrong. To earn rentals or for capital appreciation or both. If you are a property rental owner, then real estate depreciation may be very advantageous for you. Good property management accounting lets you see how much profit each property is making. If the property is a commercial property, then the depreciation period is 39 years (as opposed to 27.5 years for residential property). If that is not possible, the property should be accounted for as ‘property, plant and equipment’, and not as investment property. Pantelis Stylianides Institute of Accountancy (Ps) is a long established private provider of professional accountancy courses in Cyprus. But to properly take care of your investment, you need an accounting system. chapter 22 – investment property (problem sets) posted on november 1, 2020 by reiborn. Examples of items that are not investment property include: [IAS 40:9] Property that is being held for sale in the ordinary course of business, or that is under construction or development for such sale (within the scope of IAS 2 Inventories). IAS 40 Investment Property, defines and sets out rules on accounting for Investment Property.In summary Investment Property differs from other property, which is used in the production or supply of goods or for administrative proposes or held for sale in ordinary course of business. It allows you to manage and reduce the costs of taxes of buying and improving a property over its useful life. It allows you to accurately record your expenses, so you can make the most of tax deductions. Posted on November 18, 2020. Investment property is property (land or a building—or part of a building—or both) held (by the owner or by the lessee as a right-of-use asset) a. 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