The fair value model of accounting for PP&E assets
A) recognizes changes in the asset's fair value in other comprehensive income.
B) should be applied to investment property only.
C) once chosen for one investment property does not have to be applied to all investment property.
D) is acceptable under both IFRS and ASPE.

Question

Quizplus · Accepted Answer

The fair value model, as specified in the International Financial Reporting Standards (IFRS), is primarily applied to investment property. This model allows for the revaluation of investment property at fair value, with changes in fair value recognized in profit or loss. It is not a model applied under Accounting Standards for Private Enterprises (ASPE) in Canada, which does not allow for the fair value model for property, plant, and equipment (PP&E).

The Fair Value Model of Accounting for PP&E Assets