11-01-2009, 02:58 PM
Dear
If you (you means the entity) have intention to sell it then all the conditions of IFRS 5 should have been met provided the fixed asset is not used by you.
If you have intention to sell but are not committed to such a plan/intention; are not locating a buyer actively; and don't look forward to sell within next reporting period (12 months); then logically it means you have no current plan or intention of doing so. Rather, you simply wish to window dress the balance sheet for strengthening the current ratio.
So, if there is no intention (which should meet IFRS 5 criteria) it will not be treated under IFRS 5 or in current assets by any means. Resultantly, it is non current asset.
Just to draw attention that land, buildings, properties if acquired by a trader of such assets for trading purpose, he will present such assets under IAS 2 as inventories instead of property, plant and equipment. However, this has nothing to do with the query under discussion.
Regards,
Kamran.
If you (you means the entity) have intention to sell it then all the conditions of IFRS 5 should have been met provided the fixed asset is not used by you.
If you have intention to sell but are not committed to such a plan/intention; are not locating a buyer actively; and don't look forward to sell within next reporting period (12 months); then logically it means you have no current plan or intention of doing so. Rather, you simply wish to window dress the balance sheet for strengthening the current ratio.
So, if there is no intention (which should meet IFRS 5 criteria) it will not be treated under IFRS 5 or in current assets by any means. Resultantly, it is non current asset.
Just to draw attention that land, buildings, properties if acquired by a trader of such assets for trading purpose, he will present such assets under IAS 2 as inventories instead of property, plant and equipment. However, this has nothing to do with the query under discussion.
Regards,
Kamran.
