09-25-2003, 08:30 PM
Hi Nauman,
Interesting question, I dont there is any 'speicific' restriction on revaluation of leased assets in law or IAS, but if u look at the sec 235 of ordinance, it says " where the company has revalued ITS assets", which impliedly means the assets owned by the company.
The question is interesting in manner why any company will revalue its leased assets? as leases are available nowadays for 3 to 5 years, and i think every asset has useful life of at least 5 years (except computers)
and the second situation which comes into my mind is the Sale lease back trasaction, i.e. if a company purchases an old asset and then get it leased by sale lease back, then why should a company will lease the assets on its old value, it will revalue the asset first and then get it leased on its revalued amount. In this case the owned asset first revalued and then it was converted into leased asset.
S M R
Interesting question, I dont there is any 'speicific' restriction on revaluation of leased assets in law or IAS, but if u look at the sec 235 of ordinance, it says " where the company has revalued ITS assets", which impliedly means the assets owned by the company.
The question is interesting in manner why any company will revalue its leased assets? as leases are available nowadays for 3 to 5 years, and i think every asset has useful life of at least 5 years (except computers)
and the second situation which comes into my mind is the Sale lease back trasaction, i.e. if a company purchases an old asset and then get it leased by sale lease back, then why should a company will lease the assets on its old value, it will revalue the asset first and then get it leased on its revalued amount. In this case the owned asset first revalued and then it was converted into leased asset.
S M R
