Property, Plant and Equipment

According to IAS 16.15, an item of property, plant and equipment that qualifies for recognition as an asset shall be measured at its COST.

According to IAS 16.25, the cost of an item of property, plant and equipment is the cash price equivalent at the recognition date.

According to IAS 16.24，one or more items of property, plant and equipment may be acquired in exchange for a non-monetary asset or assets, or a combination of monetary and non-monetary assets. The cost of such an item of property, plant and equipment is measured at fair value.

According to IAS 16.26，if an entity is able to measure reliably the fair value of either the asset received or the asset given up, then the fair value of the asset given up is used to measure the cost of the asset received unless the fair value of the asset received is more clearly evident.

According to IAS 16.29, an entity shall choose either the COST MODEL in paragraph 30 or the REVALUATION MODEL in paragraph 31 as its accounting policy.

According to IAS 16.30，after initial recognition as an asset, an item of property, plant and equipment shall be carried at its COST less any accumulated depreciation and any accumulated impairment losses.

According to IAS 16.31，after initial recognition as an asset, an item of property, plant and equipment whose fair value can be measured reliably shall be carried at a revalued amount, being its FAIR VALUE at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses, that the carrying amount does not differ materially from that which would be determined using fair value at the end of the reporting period.

According to IAS 16.39，if an asset’s carrying amount is INCREASED as a result of a REVALUATION, the increase shall be recognised in OTHER COMPREHENSIVE INCOME and accumulated in equity under the heading of revaluation surplus. However, the increase shall be recognised in profit or loss to the extent that it reverses a revaluation decrease of the same asset previously recognised in profit or loss.

According to IAS 16.40，if an asset’s carrying amount is DECREASED as a result of a REVALUATION, the decrease shall be recognised in PROFIT OR LOSS. However, the decrease shall be recognised in other comprehensive income to the extent of any credit balance in the revaluation surplus in respect of that asset. The decrease recognised in other comprehensive income reduces the amount accumulated in equity under the heading of revaluation surplus.

According to IAS 16.50，the depreciable amount of an asset shall be allocated on a systematic basis over its useful life.

According to IAS 16.52，depreciation is recognised even if the fair value of the asset exceeds its carrying amount, as long as the asset’s residual value does not exceed its carrying amount. Repair and maintenance of an asset do not negate the need to depreciate it.

According to IAS 16.62，depreciation methods include the straight-line method, the diminishing balance method and the units of production method. The entity selects the method that most closely reflects the expected pattern of consumption of the future economic benefits embodied in the asset.