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CA Final · Financial Reporting · Ind AS 40 Investment Property

Which of the following statements about the subsequent measurement of investment property under Ind AS 40, as notified in India, is correct?

Ind AS 40 permits only the cost model for measuring investment property after initial recognition. Unlike IAS 40, which allows both cost and fair value models, the Indian standard deleted the fair value model paragraphs, so an entity has no choice of fair value measurement.

  1. AOnly the cost model is permitted; the fair value model of IAS 40 has been removedCorrect
  2. BThe entity may choose between the cost model and the fair value model as an accounting policy
  3. CThe fair value model is mandatory for all investment property
  4. DThe revaluation model is mandatory for investment property

Explanation

The comparison with IAS 40 states that IAS 40 permits both the cost and fair value models, whereas Ind AS 40 permits only the cost model. The paragraphs dealing with the fair value model were deleted, though their numbers are retained.

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