IAS 16 · Workpapers (Step 4 of 5)
Workpaper assignment
- Course
- Exercises
- Case studies
- Workpapers
- Exams
Useful life and residual value
Professional file: construction and commissioning of a production site
Section 1 of 8
Objective
Section brief
- What to document
- The engagement, its scope and the working mode chosen.
- Why
- A workpaper answers one precise question: framing it avoids off-topic work.
- How
- Read the objective and the assignment, then choose the mode (guided, semi-guided, professional).
- Expected result
- You know which question the workpaper must settle, and for which reporting date.
- Your role
- Preparer of the IAS 16 workpaper
- Level
- Expert
- Estimated time
- ≈ 40 min
- Progress
- 0 / 4 steps done (review excluded)
Context
Céramiques de la Haute Vallée (a fictitious company) has a 31 December reporting date and measures its property, plant and equipment under the cost model; its policy deducts grants related to assets from their carrying amount. In 20X1, it built an industrial building with its own teams and bought a tunnel kiln from a foreign supplier; the site is commissioned during the year. You are in charge of the year-end file for 20X1 and 20X2: preparation of the workpapers, proposed entries, review of the notes, answers to the reviewer's notes and conclusion of the file.
Assignment
'Useful life and residual value' workpaper: 20X2 year-end review and revision of the dismantling liability.
Purpose of the workpaper
Review the useful life and residual value at year-end: document the factors considered, conclude on each estimate and, if revised, calculate the revised charge prospectively from the carrying amount at the date of the change. No entry is recorded here: the charge is recorded in the depreciation workpaper.
Questions of the file covered by this workpaper
- 20X2 year-end review: estimates and dismantling liability; calculate the prospective effect on the lining.
Documents in the file
Open the documents to pick out the relevant information.