Valuation - auditing process, Auditing

Assignment Help:

Valuation - Auditing Process

IAS 16 requires that all assets for use through the business have been valued on the basis of depreciated historic costs along with one exception. As IAS 16 states which freehold land should not be depreciated except in the event which the reduction in value is because of depletion through assuming an example mining or because of changed economic circumstances. The cause for not depreciating freehold land is simply apparent where one looks at the definition of depreciation.

Depreciation is the portion of historic costs over the needful life of the asset.  As freehold land has no finite needful life, then there is no basis for calculating depreciation.  Freehold buildings have been depreciated and the auditor might check which the estimated needful life is reasonable and which the calculations have to be correctly made. Therefore the split between freehold buildings and the land on such land must be established being reasonable.


Related Discussions:- Valuation - auditing process

Types of audit, what is statutory audit and private audit

what is statutory audit and private audit

Inclusion in a report of investigation, Question : (a) Describe the fol...

Question : (a) Describe the following terms: 1) Forensic Accounting; 2) Forensic Investigation; 3) Forensic Auditing. (b) Explain the basic elements to consider for

Ias 20 accounting for government grants and disclosures, IAS 20 Accounting ...

IAS 20 Accounting for Government Grants and Disclosures IAS 20 Accounting for government grants and disclosures of government assistance The auditor needs to verify the

Balance sheet and income statement, OBJECTIVES To apply certain st...

OBJECTIVES To apply certain steps in the audit planning process, with emphasis on risk identification and audit response (strategy) thereto. To provide you with the exp

Non-attendance at stock takes, Non-Attendance at Stock Takes Whether t...

Non-Attendance at Stock Takes Whether the auditor is unable to attend a stock take, since he has numerous clients along with the same accounting date, or stock is situate at r

Work related health problems, Work Related Health Problems The health ...

Work Related Health Problems The health of a person working on a specific job in a particular environment may be affected by both. It is valuable to have a clear understanding

Insurance companies, Insurance Companies Authoritative documents invol...

Insurance Companies Authoritative documents involved as: The Insurance Act The Companies Act IFRS 4 Insurance Contracts The major legislation governing insu

Auding , What are the are the advantages and disadvantages of auditing an I...

What are the are the advantages and disadvantages of auditing an IT firm

Fitri, The following situations involve a possible violation of the MIA ByL...

The following situations involve a possible violation of the MIA ByLaws (on professional ethics, conduct and practice). For each situation, (1) decide whether or not the Code has b

Explain the single audit act, Q. Explain the Single Audit Act? Single A...

Q. Explain the Single Audit Act? Single Audit Act - Single Audit Act of 1984 and Single Audit Act Amendments of 1996 establish requirements for audits of states, non-profit org

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd