Investment property IAS 40




Investment property IAS 40

Overview of IAS 40


  • Issued: in 2000; re-issued in 2003, followed by amendments

  • Effective date: 1 January 2005

  • What it does:


    • IAS 40 defines investment property as property (land, building, part of a building or both) held to earn rentals or for capital appreciation or both, regardless the way of holding it (by the owner or under the finance lease as the lessee).

    • It brings examples of what the investment property is and what it is not.

    • Further classification issues are addressed, e.g.:

      • Property partially earning rentals and partially held for own use,

      • Ancillary services,

      • Intercompany rentals, etc.

    • It prescribes rules for recognition and measurement of investment property.

    • Investment property shall be at its recognition measured at cost.

    • For subsequent measurement, 2 models are allowed:

      1. Fair value model – investment property is carried at fair value; or

      2. Cost model – investment property is carried in line with IAS 16.

      3. IAS 40 deals also with transfers of investment property, disposals of investment property and prescribes number of disclosures.


  • IAS 40 Investment Property applies to the accounting for property (land and/or buildings) held to earn rentals or for capital appreciation (or both). Investment properties are initially measured at cost and, with some exceptions. may be subsequently measured using a cost model or fair value model, with changes in the fair value under the fair value model being recognised in profit or loss.

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International financial reporting standards (IAS 40)

Url: View Details

What you will learn
  • Definition of investment property
  • Examples of investment property
  • Other classification issues

Rating: 0

Level: Beginner Level

Duration: 2 hours

Instructor: Mohamed Elsayed CA, CMA, CertIFR, MSSTE


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