When a non-depreciable non-current asset such as land is sold between entities within a group, the adjustment in relation to any gain or loss recognised on the transfer is carried forward until the asset is disposed of to an external party.

Question

Quizplus · Accepted Answer

This statement is true according to accounting standards. The gain or loss on transfer of a non-depreciable non-current asset within a group is not recognised immediately but is carried forward until the asset is disposed of to an external party, at which point the adjustment is recognised in the income statement.

When a Non-Depreciable Non-Current Asset Such as Land Is Sold