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CA Final · Financial Reporting · Ind AS 105 Non-current Assets Held for Sale and Discontinued Operations

Meera Properties Ltd measures its investment property under Ind AS 40 and plans to sell one building, which meets the held-for-sale criteria. Which statement about Ind AS 105 is correct as compared with IFRS 5?

Paragraph 5(d) of IFRS 5, covering investment property under the fair value model, is deleted in Ind AS 105. The reason is that Ind AS 40 prohibits the fair value model, so the carve-out has no relevance in the Indian standard.

  1. AThe IFRS 5 paragraph 5(d) on investment property at fair value model is deleted in Ind AS 105 because Ind AS 40 prohibits the fair value modelCorrect
  2. BInd AS 105 retains paragraph 5(d), so investment property at fair value is exempt from the measurement requirements
  3. CInd AS 105 allows the fair value model for investment property classified as held for sale only
  4. DParagraph 5(d) is deleted because investment property can never be held for sale

Explanation

Appendix 1 states that paragraph 5(d) of IFRS 5, dealing with assets under the fair value model in IAS 40, is deleted in Ind AS 105 since Ind AS 40 prohibits that model. So the building is not covered by any such carve-out. Option D wrongly claims investment property can never be held for sale.

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