Initial and Subsequent Measurement

Question 1

Property, Plant, Equipment
- Initial Measurement (General, Lump Sum, Construction, Deferred, Donation)
- Subsequent Measurement

Answer 1

Initial Measurement
- General = Cost (net of discount, whether taken or not)
- Lump Sum = relative FV
- Construction = DM + DL + OH + Borrowing Costs
- Deferred = Cash Price Equivalent (if not → PV)
- Donation = Fair Value

SM = Cost Model or Revaluation Model

Question 2

Biological Assets
- Initial Measurement
- Subsequent Measurement

Answer 2

• IM = FVLCTS
• SM = FVLCTS

If FV is not reliable → cost model

On initial recognition → G/L (Cost vs FVLCTS)

Question 3

Agricultural Produce (Harvest)
- Initial Measurement
- Subsequent Measurement

Answer 3

• IM = FVLCTS
• SM = LCNRV (as if inventory)

Question 4

Wasting Assets
- Initial Measurement
- Subsequent Measurement

Answer 4

• IM = ADER (Acquisition, Development, Exploration, Restoration → discounted)
• SM = Cost Model or Revaluation Model (like PPE)

Question 5

Intangible Assets
- Initial Measurement (Buscom, Gov Grant, Internally Generated)
- Subsequent Measurement

Answer 5

Initial Measurement
- Business Combination = Fair Value
- Government Grant = Fair Value (or Zero + DACs)
- Internally Generated = DM + DL + OH + Amortization (like PPE)

SM = Cost Model or Revaluation Model (like PPE)

Question 6

Investment Property
- Initial Measurement
- Subsequent Measurement

Answer 6

• IM = Cost Model (just like PPE)
• SM = Cost Model or FV Model (different to PPE)

FV Model = at FV (not FVLCTS)

Question 7

NCAFS
- Initial Measurement
- Subsequent Measurement

Answer 7

• IM = lower of CA vs FVLCTS
• SM = lower of CA vs FVLCTS

With impairment if CA > RA

Question 8

Lessee (ROUA)
- Initial Measurement
- Subsequent Measurement

Answer 8

Initial Measurement = L-LBC-DC²
- Lease Liability
- Lease Bonus
- Lease Incentives (from lessor, thus deducted)
- Dismantling Cost (at PV)
- Initial Direct Cost (by lessee)

SM = Cost Model

Question 9

Lessee (Lease Liability)
- Initial Measurement
- Subsequent Measurement

Answer 9

Initial Measurement = LPT GO (implicit rate or incremental borrowing rate)
- Lease Payments (Fixed and Variable)
- Termination Penalties
- Guaranteed RV (by lessee)
- Purchase Option (expected to be exercised)

SM = Amortized Cost