{"entries":[{"key":"LX.IAS16.000001","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.MEASUREMENT_AT_COST"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"LOGISTICS","tested_point":"MEASUREMENT_AT_COST","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"starting-point"},"references":["IAS 16 §15"],"exercise":{"prompt":{"fr":"","en":"Case data: a logistics company buys automated racking for EUR 310,000 from a supplier in financial difficulty, while an expert values it at EUR 360,000. The racking meets the recognition criteria. True or false: it must initially be recognised at EUR 360,000, its fair value.","es":""},"explanation":{"fr":"","en":"False. Steps: (1) the item meets the recognition criteria, so we move on to measurement; (2) on initial recognition it is measured at its cost (IAS 16, para. 15); (3) here, cost is the price actually paid, EUR 310,000, plus any directly attributable costs (IAS 16, para. 16). The expert's estimate (EUR 360,000) is therefore not the starting measurement, and no EUR 50,000 gain is recognised on purchase. Main trap: confusing cost on initial recognition with fair value. Rule to remember: on initial recognition, an item of property, plant and equipment is measured at its cost, not at its fair value.","es":""},"common_error":{"fr":"","en":"Believing that a bargain purchase justifies recording the asset at fair value and recognising a gain on acquisition.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000002","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PURCHASE_PRICE"],"dimension":"RECOGNITION","format":"TRUE_FALSE","context":"RETAIL","tested_point":"RECOVERABLE_VAT_EXCLUDED","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"included-costs"},"references":["IAS 16 §16"],"exercise":{"prompt":{"fr":"","en":"Case data: a supermarket chain buys refrigerated display cabinets for EUR 80,000 excluding tax, plus EUR 16,000 of VAT that it fully deducts in its VAT return. True or false: the cost of the cabinets is EUR 96,000.","es":""},"explanation":{"fr":"","en":"False. Steps: (1) the purchase price includes non-refundable purchase taxes, after trade discounts (IAS 16, para. 16); (2) so the question is whether the VAT is recoverable; (3) here it is fully deducted in the VAT return: the entity recovers it rather than bearing it. It is recorded as a receivable from the tax authority, and the cost of the display cases stays at EUR 80,000, not EUR 96,000. Main trap: automatically taking the VAT-inclusive invoice amount. Rule to remember: non-refundable taxes are part of cost, whereas recoverable VAT is excluded (IAS 16, para. 16).","es":""},"common_error":{"fr":"","en":"Using the VAT-inclusive invoice total as the asset's cost without checking whether the VAT is recoverable.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000003","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PURCHASE_PRICE"],"dimension":"RULE_KNOWLEDGE","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"TRADE_DISCOUNT","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"included-costs"},"references":["IAS 16 §16"],"exercise":{"prompt":{"fr":"","en":"Case data: a manufacturer of mechanical parts obtains, on the invoice for a hydraulic press, an 8% trade discount linked to the size of its order. How is this discount treated on initial recognition of the press?","es":""},"explanation":{"fr":"","en":"The purchase price is stated after deducting trade discounts and rebates (IAS 16, para. 16). Steps: start from the invoiced price, deduct the 8% volume discount, and the result is the basis for the cost of the press. The discount is therefore neither income, nor deferred income, nor finance income: it simply reduces the amount given up to obtain the asset, and with it future depreciation. Main trap: recording the list price and treating the discount as a separate gain. Rule to remember: trade discounts and rebates are deducted from the cost of the item.","es":""},"common_error":{"fr":"","en":"Recording the asset at list price and treating the discount as a separate gain.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It is deducted from the purchase price, and therefore from the cost of the press.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"It is recognised as other income at the purchase date.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer treats the discount as a gain recognised on purchase. But a trade discount creates no income: it reduces the amount actually given up to obtain the press, and so its cost (IAS 16, para. 16). Example: on a price of EUR 100,000 with an 8% discount, the press enters at EUR 92,000, not at EUR 100,000 with EUR 8,000 of income. Rule to remember: a trade discount is deducted from cost; it does not go to profit or loss.","es":""}},{"id":"C","text":{"fr":"","en":"It is recorded as deferred income and spread over the useful life of the press.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer spreads the discount over the useful life as deferred income. The standard provides for no such thing: the purchase price is defined after deducting discounts (IAS 16, para. 16), so the discount is absorbed immediately in the initial cost. Its effect on profit or loss comes through lower depreciation, not through spread-out income. Rule to remember: the discount reduces cost from day one; there is no deferred income.","es":""}},{"id":"D","text":{"fr":"","en":"It is recognised as finance income.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer confuses a trade discount with finance income. A discount granted on order volume rewards the buyer for quantity, not for advancing funds: no financing is involved. It therefore reduces the purchase price, and so the cost of the press (IAS 16, para. 16). Rule to remember: a trade discount reduces the purchase price, and therefore the cost (IAS 16, para. 16).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000004","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.CESSATION_OF_CAPITALISATION"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"HOSPITALITY","tested_point":"CAPITALISATION_STOPS","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"excluded-costs"},"references":["IAS 16 §17","IAS 16 §20"],"exercise":{"prompt":{"fr":"","en":"Case data: a hotel fits out the kitchen of its new restaurant. Assembly of the equipment ends on 20 February; the cooking trials, which are successful, are signed off by the supplier's technician on 5 March. Because staff have not yet been hired, the restaurant only opens on 1 May, and it will not be fully booked until July. On what date does capitalisation of costs into the carrying amount of the equipment stop?","es":""},"explanation":{"fr":"","en":"Testing proper functioning is part of getting the asset ready (IAS 16, para. 17). Once the tests are signed off on 5 March, the equipment is in the location and condition necessary to operate as intended: capitalisation stops, and later waiting or under-capacity costs are expensed (IAS 16, para. 20).","es":""},"common_error":{"fr":"","en":"Confusing the date the asset is ready with the commercial opening date.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"20 February","es":""},"correct":false,"feedback":{"fr":"","en":"20 February is the end of assembly, but assembly is not the last step of getting the asset ready: testing that it functions properly is part of it (IAS 16, para. 17). The cooking trials, still to be done on that date, are directly attributable costs that remain capitalisable until they are validated on 5 March. Rule to remember: capitalisation stops when the asset is in the location and condition necessary to operate, not when physical installation ends (IAS 16, para. 20).","es":""}},{"id":"B","text":{"fr":"","en":"5 March","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"1 May","es":""},"correct":false,"feedback":{"fr":"","en":"1 May is the opening date, but it is not what bounds capitalisation. From 5 March, the equipment is in the location and condition necessary to operate as intended; costs incurred while it waits to be used are no longer capitalised (IAS 16, para. 20). Example: energy and maintenance for March and April are expensed, not added to the cost of the equipment. Rule to remember: an asset that is ready but not yet used does not keep absorbing costs.","es":""}},{"id":"D","text":{"fr":"","en":"In July, when the restaurant runs at full capacity","es":""},"correct":false,"feedback":{"fr":"","en":"This answer waits for full capacity in July. But using the asset below normal capacity does not extend the capitalisation period: initial operating losses and under-utilisation are costs of use and are excluded from cost (IAS 16, para. 20). Example: if the restaurant loses EUR 20,000 in May and June for lack of customers, that loss is an expense, not an addition to cost. Rule to remember: the commercial ramp-up does not push back the date capitalisation ends.","es":""}}]},"scope":"CORE_STUDENT","reserve":true},{"key":"LX.IAS16.000005","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE","IAS16.INITIAL_COST.EXCLUDED_COSTS"],"dimension":"RECOGNITION","format":"MULTIPLE_CHOICE","context":"AGRIFOOD","tested_point":"DIRECTLY_ATTRIBUTABLE_EXAMPLES","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"bakery-example"},"references":["IAS 16 §17","IAS 16 §19"],"exercise":{"prompt":{"fr":"","en":"Case data: an industrial biscuit maker installs a tunnel oven in its plant. Which of the following expenditures form part of the cost of the oven?","es":""},"explanation":{"fr":"","en":"Initial delivery and handling, site preparation, professional fees and employee benefits arising directly from the assembly are directly attributable costs (IAS 16, para. 17). Promoting a new range and general overheads are expensed (IAS 16, para. 19).","es":""},"common_error":{"fr":"","en":"Excluding internal wages because they would be paid anyway, although here they arise directly from the assembly.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Transport by a specialised carrier and unloading at the plant","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Strengthening the concrete slab that will support the oven","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Fees of an engineering firm for the layout plan and the gas connection","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"Wages of two maintenance technicians assigned for three weeks to assembling the oven","es":""},"correct":true},{"id":"E","text":{"fr":"","en":"Promotional campaign for the new biscuit range that the oven will produce","es":""},"correct":false,"feedback":{"fr":"","en":"This expense is tempting because the oven will make the new range, but the link is indirect: advertising a product is part of introducing a new product or service, expressly excluded from cost (IAS 16, para. 19). The oven does not need the campaign to be ready to operate; it is expensed. The expenditures that qualify (delivery, slab, fees, assembly wages) are directly necessary to get the oven ready (IAS 16, para. 17). Rule to remember: what is spent to sell or launch a product does not go into the cost of the equipment.","es":""}},{"id":"F","text":{"fr":"","en":"Share of the plant manager's salary allocated to the year's investments","es":""},"correct":false,"feedback":{"fr":"","en":"This share is a flat allocation of management overhead, not a cost incurred directly to bring the oven to the location and condition required. Administration and general overheads are excluded from cost (IAS 16, para. 19). By contrast, the two technicians' wages qualify because they arise directly from the assembly (IAS 16, para. 17). Rule to remember: a cost is capitalised if it is directly attributable, not merely because it can be allocated.","es":""}}]},"scope":"CORE_STUDENT","reserve":true},{"key":"LX.IAS16.000006","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.EXCLUDED_COSTS"],"dimension":"RULE_KNOWLEDGE","format":"MULTIPLE_CHOICE","context":"RETAIL","tested_point":"EXCLUDED_COSTS_EXAMPLES","difficulty":"BEGINNER","estimated_time_s":60,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"excluded-costs"},"references":["IAS 16 §17","IAS 16 §19"],"exercise":{"prompt":{"fr":"","en":"Case data: a chain of sports stores opens a new outlet and fits it with furniture and checkouts. Which expenditures must be excluded from the cost of this equipment and expensed?","es":""},"explanation":{"fr":"","en":"Costs of opening a new facility, costs of doing business in a new location (including staff training) and administration and general overheads are excluded from cost (IAS 16, para. 19). Delivery and assembly remain directly attributable costs (IAS 16, para. 17).","es":""},"common_error":{"fr":"","en":"Assuming that everything spent around the store opening adds to the cost of the equipment.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Opening evening of the store for local customers","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Training of the sales staff hired for this new store","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Share of head office accounting department costs","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"Assembly of the shelving by the contractor","es":""},"correct":false,"feedback":{"fr":"","en":"This expenditure should not be excluded: assembling the shelving is an installation needed to put it in the location and condition required, so it is a directly attributable cost included in cost (IAS 16, para. 17). The fact that an outside contractor invoices it changes nothing. The exclusions target, instead, opening events, training and general overheads (IAS 16, para. 19). Rule to remember: installation and assembly are added to the cost of the equipment.","es":""}},{"id":"E","text":{"fr":"","en":"Delivery of the checkouts to the store","es":""},"correct":false,"feedback":{"fr":"","en":"This expenditure should not be excluded: the initial delivery of the tills to the store is one of the directly attributable costs (IAS 16, para. 17). Without it, the tills would not be where they are meant to operate. Rule to remember: initial delivery and handling are part of cost.","es":""}}]},"scope":"CORE_STUDENT","reserve":true},{"key":"LX.IAS16.000007","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PURCHASE_PRICE"],"dimension":"APPLICATION","format":"FILL_BLANK","context":"ENERGY","tested_point":"RECOVERABLE_VAT_EXCLUDED","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"included-costs"},"references":["IAS 16 §16"],"exercise":{"prompt":{"fr":"","en":"Complete the treatment applied to the purchase of an imported wind turbine.","es":""},"explanation":{"fr":"","en":"Steps: (1) the purchase price comprises import duties and non-refundable taxes, after trade discounts and rebates (IAS 16, para. 16). (2) Customs duties are non-refundable and are a final cost: they are included in cost. (3) Import VAT is fully recovered: it is not a cost borne, it is recorded as a receivable from the tax authority, outside cost. (4) The trade discount is deducted from cost, neither recognised as income nor ignored. Main trap: treating customs duties and VAT in the same way. Rule to remember: non-refundable duties and taxes are added to cost, recoverable VAT is excluded and the discount is deducted (IAS 16, para. 16).","es":""},"common_error":{"fr":"","en":"Treating customs duties and import VAT the same way, although only the duties are a definitive cost.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"Case data: an electricity producer imports a wind turbine. The customs duties, which are non-refundable, are {{duties}}; the import VAT, which the producer recovers in full, is {{vat}}; the trade discount granted on the invoice by the manufacturer is {{discount}}.","es":""},"blanks":[{"id":"duties","mode":"CHOICE","choices":[{"id":"INCLUDED","text":{"fr":"","en":"included in cost","es":""}},{"id":"EXPENSED","text":{"fr":"","en":"expensed","es":""}}],"answer":"INCLUDED"},{"id":"vat","mode":"CHOICE","choices":[{"id":"INCLUDED","text":{"fr":"","en":"included in cost","es":""}},{"id":"RECEIVABLE","text":{"fr":"","en":"recognised as a receivable, outside cost","es":""}},{"id":"EXPENSED","text":{"fr":"","en":"expensed","es":""}}],"answer":"RECEIVABLE"},{"id":"discount","mode":"CHOICE","choices":[{"id":"DEDUCTED","text":{"fr":"","en":"deducted from cost","es":""}},{"id":"INCOME","text":{"fr":"","en":"recognised as income","es":""}},{"id":"IGNORED","text":{"fr":"","en":"ignored until payment","es":""}}],"answer":"DEDUCTED"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000008","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PURCHASE_PRICE"],"dimension":"CALCULATION","format":"FILL_BLANK","context":"LOGISTICS","tested_point":"TRADE_DISCOUNT","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"laser-calculation"},"references":["IAS 16 §16"],"exercise":{"prompt":{"fr":"","en":"Calculate the purchase price to be used for a fleet of forklift trucks.","es":""},"explanation":{"fr":"","en":"Steps: (1) start from the list price of EUR 180,000 and deduct the 10% trade discount, i.e. EUR 18,000, giving EUR 162,000; (2) add the import duties of EUR 4,860 and the non-refundable purchase tax of EUR 2,400: EUR 169,260; (3) leave out the VAT of EUR 32,400, fully recoverable and recorded as a receivable (IAS 16, para. 16). Purchase price included in cost: EUR 169,260. Main trap: starting from the list price or adding the recoverable VAT. Rule to remember: purchase price = price after discounts + non-refundable duties and taxes, without recoverable VAT.","es":""},"common_error":{"fr":"","en":"Starting from the list price (EUR 187,260), leaving out the non-refundable tax (EUR 166,860) or adding the recoverable VAT (EUR 201,660).","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"Case data: list price EUR 180,000; 10% trade discount obtained on the invoice; import duties EUR 4,860; non-refundable purchase tax EUR 2,400; VAT EUR 32,400, fully recoverable. Purchase price included in cost: EUR {{price}}.","es":""},"blanks":[{"id":"price","mode":"NUMBER","answer":169260,"tolerance":0}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000009","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PURCHASE_PRICE","IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE","IAS16.INITIAL_COST.EXCLUDED_COSTS","IAS16.INITIAL_COST.CESSATION_OF_CAPITALISATION"],"dimension":"RECOGNITION","format":"MATCHING","context":"TELECOM","tested_point":"PURCHASE_PRICE_COMPONENTS","difficulty":"ADVANCED","estimated_time_s":120,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"how"},"references":["IAS 16 §16","IAS 16 §17","IAS 16 §19","IAS 16 §20"],"exercise":{"prompt":{"fr":"","en":"Case data: a telecom operator deploys a new antenna site. Match each expenditure with the basis for its treatment.","es":""},"explanation":{"fr":"","en":"Steps: for each expenditure, identify whether it is part of the purchase price, a directly attributable cost, or excluded. Non-refundable duties are part of the purchase price (IAS 16, para. 16). Engineering fees are professional fees, directly attributable (IAS 16, para. 17). Advertising for a new service and the share of head office IT costs are excluded, as introduction costs and general overheads (IAS 16, para. 19). Energy and maintenance for a site that is already operational but little used are incurred after it is ready and are no longer capitalised (IAS 16, para. 20). No expenditure matches 'Deducted from the purchase price': that is the treatment of a trade discount. Main trap: linking the first months of operation to getting the asset ready. Rule to remember: cost stops once the asset is ready, even when traffic is still low.","es":""},"common_error":{"fr":"","en":"Treating the costs of the first operating months as part of getting the asset ready because the site is ramping up.","es":""},"format":"MATCHING","left":[{"id":"L1","text":{"fr":"","en":"Non-refundable customs duties on the imported radio equipment","es":""}},{"id":"L2","text":{"fr":"","en":"Fees of an engineering firm validating the mast's anchoring","es":""}},{"id":"L3","text":{"fr":"","en":"Advertising campaign announcing the new 5G coverage in the region","es":""}},{"id":"L4","text":{"fr":"","en":"Share of the head office IT department's costs","es":""}},{"id":"L5","text":{"fr":"","en":"Energy and maintenance for the three months when the site, already operational, still carries little traffic","es":""}}],"right":[{"id":"R1","text":{"fr":"","en":"Included: part of the purchase price","es":""}},{"id":"R2","text":{"fr":"","en":"Included: directly attributable cost","es":""}},{"id":"R3","text":{"fr":"","en":"Expense: introducing a new service","es":""}},{"id":"R4","text":{"fr":"","en":"Expense: administration and general overheads","es":""}},{"id":"R5","text":{"fr":"","en":"Expense: cost incurred after the asset is ready","es":""}},{"id":"R6","text":{"fr":"","en":"Deducted from the purchase price","es":""}}],"pairs":[{"left":"L1","right":"R1"},{"left":"L2","right":"R2"},{"left":"L3","right":"R3"},{"left":"L4","right":"R4"},{"left":"L5","right":"R5"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000010","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE","IAS16.INITIAL_COST.EXCLUDED_COSTS"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"MANUFACTURING","tested_point":"DIRECTLY_ATTRIBUTABLE_EXAMPLES","difficulty":"BEGINNER","estimated_time_s":90,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"bakery-example"},"references":["IAS 16 §12","IAS 16 §17","IAS 16 §19","IAS 16 §20"],"exercise":{"prompt":{"fr":"","en":"Case data: an aerospace subcontractor acquires a CNC machining centre. Classify each expenditure.","es":""},"explanation":{"fr":"","en":"Steps: for each expenditure, ask whether it is directly attributable to getting the machine ready or falls under an exclusion. Delivery, installation, wages of technicians assigned to the assembly and machining of test pieces to check accuracy are directly attributable costs (IAS 16, para. 17): they go into cost. Operator training and the share of administrative costs are excluded (IAS 16, para. 19). The annual maintenance contract, which starts after commissioning, is day-to-day servicing and is expensed (IAS 16, paras. 12 and 20). Main trap: classifying training as cost because the machine cannot run without trained operators. Rule to remember: training, general overheads and day-to-day servicing stay in expenses.","es":""},"common_error":{"fr":"","en":"Putting operator training into cost because the machine cannot be used without trained operators.","es":""},"format":"CLASSIFICATION","categories":[{"id":"COST","text":{"fr":"","en":"Included in the cost of the machine","es":""}},{"id":"EXPENSE","text":{"fr":"","en":"Expensed","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Delivery and handling to the workshop","es":""},"category":"COST"},{"id":"I2","text":{"fr":"","en":"Installation and floor anchoring","es":""},"category":"COST"},{"id":"I3","text":{"fr":"","en":"Wages of in-house technicians assigned to the assembly","es":""},"category":"COST"},{"id":"I4","text":{"fr":"","en":"Machining test pieces to check accuracy before commissioning","es":""},"category":"COST"},{"id":"I5","text":{"fr":"","en":"Training operators in programming","es":""},"category":"EXPENSE"},{"id":"I6","text":{"fr":"","en":"Share of the plant's administrative costs","es":""},"category":"EXPENSE"},{"id":"I7","text":{"fr":"","en":"Annual maintenance contract starting after commissioning","es":""},"category":"EXPENSE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000011","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.CESSATION_OF_CAPITALISATION","IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE"],"dimension":"APPLICATION","format":"CLASSIFICATION","context":"LOGISTICS","tested_point":"CAPITALISATION_STOPS","difficulty":"ADVANCED","estimated_time_s":120,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"excluded-costs"},"references":["IAS 16 §16","IAS 16 §17","IAS 16 §20"],"exercise":{"prompt":{"fr":"","en":"Case data: a parcel hub installs an automated sorting system. The acceptance certificate, signed on 31 August, states that the system works according to specification. Classify each expenditure.","es":""},"explanation":{"fr":"","en":"Steps: (1) identify the reference date, 31 August, when the acceptance report states that the system works as specified: the asset is then in the location and condition necessary (IAS 16, para. 20); (2) before that date, the dedicated power supply (installation), the non-refundable customs duties (purchase price) and the acceptance tests (testing) are capitalised (IAS 16, paras. 16 and 17); (3) after that date, waiting for a contract, running at 30% of capacity and dismantling and relocation are costs of use or redeployment, expensed (IAS 16, para. 20). Main trap: extending capitalisation until the first contract or full capacity. Rule to remember: capitalisation stops when the asset is ready, and everything after that is expensed.","es":""},"common_error":{"fr":"","en":"Extending capitalisation until the first customer contract is signed or full capacity is reached.","es":""},"format":"CLASSIFICATION","categories":[{"id":"COST","text":{"fr":"","en":"Included in the cost of the system","es":""}},{"id":"EXPENSE","text":{"fr":"","en":"Expensed","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"July: dedicated power supply installed for the system","es":""},"category":"COST"},{"id":"I2","text":{"fr":"","en":"Non-refundable customs duties on the imported conveyors","es":""},"category":"COST"},{"id":"I3","text":{"fr":"","en":"August: acceptance tests with test parcels","es":""},"category":"COST"},{"id":"I4","text":{"fr":"","en":"September-October: security and energy for the system, ready but idle while awaiting a customer contract","es":""},"category":"EXPENSE"},{"id":"I5","text":{"fr":"","en":"November: operating losses while the system runs at 30% of capacity","es":""},"category":"EXPENSE"},{"id":"I6","text":{"fr":"","en":"The following year: dismantling and moving the system to another hub","es":""},"category":"EXPENSE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000012","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.MEASUREMENT_AT_COST","IAS16.INITIAL_COST.PURCHASE_PRICE","IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE","IAS16.INITIAL_COST.EXCLUDED_COSTS"],"dimension":"DOCUMENTATION","format":"ORDERING","context":"YEAR_END_CLOSE","tested_point":"MEASUREMENT_AT_COST","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"how"},"references":["IAS 16 §7","IAS 16 §15","IAS 16 §16","IAS 16 §17","IAS 16 §19","IAS 16 §20"],"exercise":{"prompt":{"fr":"","en":"You are preparing the working paper supporting the initial cost of equipment acquired during the year. Put the steps in logical order.","es":""},"explanation":{"fr":"","en":"Steps: follow the standard's logic. (1) First check that the item meets the recognition criteria (IAS 16, para. 7). (2) Then measure it at cost (IAS 16, para. 15), starting with the net purchase price: discounts deducted, non-recoverable duties and taxes added, recoverable VAT left out (IAS 16, para. 16). (3) Fix the date the asset is ready, with evidence, because it bounds the capitalisation period (IAS 16, para. 20). (4) Add the directly attributable costs incurred up to that date (IAS 16, para. 17). (5) List and document the excluded or later expenditures (IAS 16, paras. 19 and 20). (6) Reconcile the total with the general ledger and post the entry. Main trap: adding up every invoice before fixing the date the asset is ready. This order is a pedagogical working method, not a sequence imposed by the standard. Rule to remember: criteria, net price, ready date, attributable costs, exclusions, then the entry.","es":""},"common_error":{"fr":"","en":"Adding up all project invoices before fixing the ready date, then forgetting to remove the later costs.","es":""},"format":"ORDERING","steps":[{"id":"S1","text":{"fr":"","en":"Check that the equipment meets the recognition criteria for property, plant and equipment","es":""}},{"id":"S2","text":{"fr":"","en":"Establish the net purchase price from the invoice: discounts deducted, non-recoverable duties and taxes added, recoverable VAT left out","es":""}},{"id":"S3","text":{"fr":"","en":"Once the net purchase price is established, determine, with supporting evidence (acceptance certificate), the date on which the equipment is ready to operate as intended","es":""}},{"id":"S4","text":{"fr":"","en":"Add the directly attributable costs incurred up to that date, with their supporting documents","es":""}},{"id":"S5","text":{"fr":"","en":"List the remaining expenditures (excluded costs, costs after the asset is ready) and document why they are expensed","es":""}},{"id":"S6","text":{"fr":"","en":"Reconcile the total with the general ledger and post the capitalisation entry","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000013","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PURCHASE_PRICE","IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE","IAS16.INITIAL_COST.EXCLUDED_COSTS","IAS16.INITIAL_COST.CESSATION_OF_CAPITALISATION"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"HOSPITALITY","tested_point":"EXCLUDED_COSTS_EXAMPLES","difficulty":"EXPERT","estimated_time_s":180,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"pitfalls"},"references":["IAS 16 §16","IAS 16 §17","IAS 16 §19","IAS 16 §20"],"exercise":{"prompt":{"fr":"","en":"Case data: a hotel group opens a new hotel and equips its laundry. The laundry is ready to operate on 1 March; the hotel opens on 1 May. The accountant proposes the cost schedule below. Spot the incorrect lines.","es":""},"explanation":{"fr":"","en":"Approach: take each expenditure in the file and place it in cost, among the excluded costs or after the asset is ready. Cost keeps the price net of discount (IAS 16, para. 16), the connection (installation) and the tests of proper functioning (IAS 16, para. 17). Recoverable VAT is excluded (IAS 16, para. 16), training and the inauguration are excluded costs (IAS 16, para. 19) and waiting costs after 1 March are no longer capitalised (IAS 16, para. 20). Correct cost: EUR 92,500. Trap: adding up every invoice of the project. Rule to remember: cost comprises the net price and directly attributable costs up to the point of readiness; the rest goes to expenses (IAS 16, paras. 16 to 20).","es":""},"common_error":{"fr":"","en":"Correcting only the VAT and leaving the hotel-opening costs, seen as part of the project.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"List price EUR 90,000, less trade discount EUR 5,000: EUR 85,000 included.","es":""},"erroneous":false},{"id":"S2","text":{"fr":"","en":"Deductible VAT on the invoice: EUR 17,000 included.","es":""},"erroneous":true,"correction":{"fr":"","en":"Recoverable VAT is not a cost: it is recorded as a receivable (IAS 16, para. 16).","es":""}},{"id":"S3","text":{"fr":"","en":"Connection of the machines to the water and power networks by a plumber: EUR 6,000 included.","es":""},"erroneous":false},{"id":"S4","text":{"fr":"","en":"Training of the laundry staff: EUR 2,500 included.","es":""},"erroneous":true,"correction":{"fr":"","en":"Staff training is an excluded cost and is expensed (IAS 16, para. 19).","es":""}},{"id":"S5","text":{"fr":"","en":"Hotel inauguration evening, part of which is attributed to the laundry: EUR 4,000 included.","es":""},"erroneous":true,"correction":{"fr":"","en":"Opening a new facility is an excluded cost and is expensed (IAS 16, para. 19).","es":""}},{"id":"S6","text":{"fr":"","en":"Trial wash cycles run in February to check the machines: EUR 1,500 included.","es":""},"erroneous":false},{"id":"S7","text":{"fr":"","en":"Energy and maintenance for March and April, laundry ready but hotel closed: EUR 1,200 included.","es":""},"erroneous":true,"correction":{"fr":"","en":"These costs arise after the asset is ready, while it waits to be used: expense (IAS 16, para. 20).","es":""}},{"id":"S8","text":{"fr":"","en":"Proposed initial cost: EUR 117,200.","es":""},"erroneous":true,"correction":{"fr":"","en":"Correct initial cost: 85,000 + 6,000 + 1,500 = EUR 92,500; the EUR 7,700 of training, inauguration and waiting costs are expensed, and the VAT is a receivable.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000014","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PURCHASE_PRICE","IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE","IAS16.INITIAL_COST.EXCLUDED_COSTS"],"dimension":"CALCULATION","format":"CALCULATION","context":"PACKAGING","tested_point":"PURCHASE_PRICE_COMPONENTS","difficulty":"INTERMEDIATE","estimated_time_s":240,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"laser-calculation"},"references":["IAS 16 §16","IAS 16 §17","IAS 16 §19"],"exercise":{"prompt":{"fr":"","en":"Case data: a packaging manufacturer acquires an imported packing line. VAT is fully recoverable. Calculate the initial cost of the line and the amount expensed.","es":""},"explanation":{"fr":"","en":"Steps: (1) Net purchase price: 400,000 − 5% discount (20,000) + 12,000 import duties = EUR 392,000; the recoverable VAT of EUR 76,000 is excluded (IAS 16, para. 16). (2) Directly attributable costs: freight and insurance 6,500 + installation 18,000 + functioning tests 4,200 = EUR 28,700 (IAS 16, para. 17). (3) Initial cost: 392,000 + 28,700 = EUR 420,700. (4) Expenses: training 3,800 + general overheads 9,000 = EUR 12,800 (IAS 16, para. 19). Main trap: adding training and overheads to reach a 'full cost' of EUR 433,500. Rule to remember: cost = net price + non-refundable duties + directly attributable costs; training and general overheads stay in expenses.","es":""},"common_error":{"fr":"","en":"Including training and overheads to obtain a full cost of EUR 433,500.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"List price","es":""},"value":"400000","unit":"EUR"},{"label":{"fr":"","en":"Trade discount on the invoice","es":""},"value":"5","unit":"PERCENT"},{"label":{"fr":"","en":"Import duties","es":""},"value":"12000","unit":"EUR"},{"label":{"fr":"","en":"Recoverable VAT","es":""},"value":"76000","unit":"EUR"},{"label":{"fr":"","en":"Transport and insurance to the plant","es":""},"value":"6500","unit":"EUR"},{"label":{"fr":"","en":"Installation by the integrator","es":""},"value":"18000","unit":"EUR"},{"label":{"fr":"","en":"Functional tests before commissioning","es":""},"value":"4200","unit":"EUR"},{"label":{"fr":"","en":"Training of line operators","es":""},"value":"3800","unit":"EUR"},{"label":{"fr":"","en":"Share of plant general overheads","es":""},"value":"9000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Net purchase price (discount deducted, duties included)","es":""},"answer":392000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Directly attributable costs","es":""},"answer":28700,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Initial cost of the line","es":""},"answer":420700,"tolerance":0,"unit":"EUR"},{"id":"S4","label":{"fr":"","en":"Amount expensed (excluding VAT)","es":""},"answer":12800,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S2","meaning":{"fr":"","en":"Directly attributable costs","es":""},"expression":"a + b + c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Transport and insurance to the plant","es":""},"value":6500,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Installation by the integrator","es":""},"value":18000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Functional tests before commissioning","es":""},"value":4200,"unit":"EUR"}],"result":28700,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Initial cost of the line","es":""},"expression":"a + b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Net purchase price (discount deducted, duties included)","es":""},"value":392000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Directly attributable costs","es":""},"value":28700,"unit":"EUR"}],"result":420700,"unit":"EUR"},{"step":"S4","meaning":{"fr":"","en":"Amount expensed (excluding VAT)","es":""},"expression":"a + b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Training of line operators","es":""},"value":3800,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Share of plant general overheads","es":""},"value":9000,"unit":"EUR"}],"result":12800,"unit":"EUR"}],"rationale":{"fr":"","en":"cost = net price + non-refundable duties + directly attributable costs; training and general overheads stay in expenses.","es":""},"references":["REF.IAS16.16","REF.IAS16.17","REF.IAS16.19"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000015","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PURCHASE_PRICE","IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE","IAS16.INITIAL_COST.EXCLUDED_COSTS","IAS16.INITIAL_COST.CESSATION_OF_CAPITALISATION"],"dimension":"CALCULATION","format":"CALCULATION","context":"HEALTHCARE","tested_point":"PURCHASE_PRICE_COMPONENTS","difficulty":"ADVANCED","estimated_time_s":300,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"laser-calculation"},"references":["IAS 16 §16","IAS 16 §17","IAS 16 §19","IAS 16 §20"],"exercise":{"prompt":{"fr":"","en":"Case data: a clinic acquires a sterilisation unit. Because its healthcare activity is exempt, it cannot recover the VAT on this purchase (case data: the tax status is given and does not need to be analysed). The unit is validated and ready on 1 February; the new wing that will use it only opens on 1 May. Calculate the initial cost and the expenses.","es":""},"explanation":{"fr":"","en":"Steps: (1) Net price: 300,000 − 4% (12,000) = EUR 288,000. Case data: the clinic cannot recover the VAT of EUR 57,600; it is therefore a non-refundable tax, included in the purchase price: EUR 345,600 (IAS 16, para. 16). (2) Directly attributable costs: delivery 3,400 + installation 11,000 + validation cycles before 1 February 5,600 = EUR 20,000 (IAS 16, para. 17). (3) Initial cost: EUR 365,600. (4) Expenses: maintenance and insurance from February to April, incurred after the asset was ready (2,700, IAS 16, para. 20), and training (4,500, IAS 16, para. 19) = EUR 7,200. Main trap: excluding VAT by reflex, without checking whether it is recoverable. Rule to remember: non-recoverable VAT is part of cost; costs after the asset is ready and training are expenses.","es":""},"common_error":{"fr":"","en":"Excluding VAT by reflex, without checking that here it cannot be recovered and is therefore a cost.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"List price","es":""},"value":"300000","unit":"EUR"},{"label":{"fr":"","en":"Trade discount","es":""},"value":"4","unit":"PERCENT"},{"label":{"fr":"","en":"Non-recoverable VAT, computed on the price net of discount","es":""},"value":"57600","unit":"EUR"},{"label":{"fr":"","en":"Delivery","es":""},"value":"3400","unit":"EUR"},{"label":{"fr":"","en":"Installation and connection to the water network","es":""},"value":"11000","unit":"EUR"},{"label":{"fr":"","en":"Validation cycles before 1 February","es":""},"value":"5600","unit":"EUR"},{"label":{"fr":"","en":"Maintenance and insurance from February to April","es":""},"value":"2700","unit":"EUR"},{"label":{"fr":"","en":"Training of nursing staff","es":""},"value":"4500","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Purchase price, including non-recoverable VAT","es":""},"answer":345600,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Directly attributable costs","es":""},"answer":20000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Initial cost of the unit","es":""},"answer":365600,"tolerance":0,"unit":"EUR"},{"id":"S4","label":{"fr":"","en":"Amount expensed","es":""},"answer":7200,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000016","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PURCHASE_PRICE"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"CONSTRUCTION","tested_point":"RECOVERABLE_VAT_EXCLUDED","difficulty":"INTERMEDIATE","estimated_time_s":150,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"entry"},"references":["IAS 16 §15","IAS 16 §16"],"exercise":{"prompt":{"fr":"","en":"Case data: a construction company buys a tower crane on credit. Invoice: price EUR 150,000, trade discount EUR 6,000, net EUR 144,000, recoverable VAT EUR 28,800, total payable EUR 172,800. Record the acquisition entry (the supplier line is partly pre-filled).","es":""},"explanation":{"fr":"","en":"Steps: (1) The crane is measured at cost (IAS 16, para. 15). (2) The purchase price is stated after trade discounts: 150,000 − 6,000 = EUR 144,000, debited to property, plant and equipment (IAS 16, para. 16). (3) The recoverable VAT of EUR 28,800 is not a cost: it is debited as a receivable from the tax authority. (4) The payable to the supplier covers the total invoiced, 144,000 + 28,800 = EUR 172,800, credited. The entry balances at EUR 172,800 and no income line is created for the discount. Main trap: debiting the asset with the gross or VAT-inclusive amount. Rule to remember: the asset is debited at the price net of discount, excluding recoverable VAT.","es":""},"common_error":{"fr":"","en":"Debiting the asset with EUR 150,000 and crediting the discount to other income, or debiting the asset with the VAT-inclusive amount.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"VAT_RECEIVABLE","text":{"fr":"","en":"Recoverable VAT","es":""}},{"id":"FIXED_ASSET_PAYABLES","text":{"fr":"","en":"Payables for fixed assets","es":""}},{"id":"OTHER_INCOME","text":{"fr":"","en":"Other income","es":""}},{"id":"PURCHASES_EXPENSE","text":{"fr":"","en":"Purchases expense","es":""}}],"lines":[{"id":"L1","account":"PPE","side":"DEBIT","amount":144000},{"id":"L2","account":"VAT_RECEIVABLE","side":"DEBIT","amount":28800},{"id":"L3","account":"FIXED_ASSET_PAYABLES","side":"CREDIT","amount":172800,"given":["account","side"]}]},"scope":"CORE_STUDENT","reserve":true},{"key":"LX.IAS16.000017","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE","IAS16.INITIAL_COST.EXCLUDED_COSTS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"ENERGY","tested_point":"EXCLUDED_COSTS_EXAMPLES","difficulty":"ADVANCED","estimated_time_s":210,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"entry"},"references":["IAS 16 §16","IAS 16 §17","IAS 16 §19"],"exercise":{"prompt":{"fr":"","en":"Case data: an operator of a small hydroelectric plant pays by bank the invoices relating to a new turbine-generator set: set EUR 600,000; installation EUR 45,000; commissioning tests EUR 15,000; operator training EUR 8,000; inauguration ceremony for the new set EUR 6,000. Teaching assumption: amounts exclude recoverable VAT, which is ignored. Record the entry, grouping the expenses in a single account.","es":""},"explanation":{"fr":"","en":"Steps: (1) Cost of the unit: price 600,000 + installation 45,000 + commissioning tests 15,000 = EUR 660,000, debited to property, plant and equipment (IAS 16, paras. 16 and 17). (2) Operator training 8,000 + inauguration ceremony 6,000 = EUR 14,000: these are excluded costs (activity in a new location, opening of a new facility), debited to expenses (IAS 16, para. 19). (3) The bank credit is the total paid, EUR 674,000; the entry balances. The training will probably benefit future periods, but that does not allow it to be added to cost or deferred as a prepaid expense. Main trap: capitalising everything. Rule to remember: directly attributable costs of getting the asset ready are added to cost (IAS 16, paras. 16 and 17); training and inauguration costs go to expenses (IAS 16, para. 19).","es":""},"common_error":{"fr":"","en":"Capitalising the full EUR 674,000, or deferring the training in the balance sheet as a prepaid expense.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"OPERATING_EXPENSES","text":{"fr":"","en":"Operating expenses","es":""}},{"id":"BANK","text":{"fr":"","en":"Bank","es":""}},{"id":"PREPAID_EXPENSES","text":{"fr":"","en":"Prepaid expenses","es":""}},{"id":"INTANGIBLE_ASSETS","text":{"fr":"","en":"Intangible assets","es":""}}],"lines":[{"id":"L1","account":"PPE","side":"DEBIT","amount":660000},{"id":"L2","account":"OPERATING_EXPENSES","side":"DEBIT","amount":14000},{"id":"L3","account":"BANK","side":"CREDIT","amount":674000}]},"scope":"CORE_STUDENT","reserve":true},{"key":"LX.IAS16.000018","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.MEASUREMENT_AT_COST","IAS16.INITIAL_COST.PURCHASE_PRICE","IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE","IAS16.INITIAL_COST.EXCLUDED_COSTS","IAS16.INITIAL_COST.CESSATION_OF_CAPITALISATION"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"AUTOMOTIVE","tested_point":"CAPITALISATION_STOPS","difficulty":"EXPERT","estimated_time_s":600,"lesson_id":"LS.IAS16.000001","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"judgment"},"references":["IAS 16 §15","IAS 16 §16","IAS 16 §17","IAS 16 §19","IAS 16 §20"],"exercise":{"prompt":{"fr":"","en":"Analyse the file for the robotic paint cell, then answer the four questions.","es":""},"explanation":{"fr":"","en":"Steps: (1) The cell is measured at cost (IAS 16, para. 15). (2) End of capitalisation: the unqualified acceptance report of 30 September shows the cell is in the location and condition necessary; what follows (shortage of orders, under-utilisation) is no longer capitalised (IAS 16, para. 20). (3) Cost: net price 820,000 + freight 12,000 + installation 58,000 + documented engineer time 30,000 + tests 22,000 = EUR 942,000 (IAS 16, paras. 16 and 17). (4) Expenses: training 9,000 and management overheads 15,000 (IAS 16, para. 19), under-utilisation losses 35,000 (IAS 16, para. 20) = EUR 59,000. Professional judgement: 'everything related to the project' is not a criterion; the direct link, evidenced by time sheets, and the date the asset is ready are. Main trap: choosing 15 October and capitalising start-up losses. Rule to remember: capitalise what is directly attributable up to the date the asset is ready, and nothing after.","es":""},"common_error":{"fr":"","en":"Using 15 October as the date capitalisation ends and capitalising start-up losses as project costs.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Case data: an automotive supplier installs a robotic paint cell in its plant. Assembly ends on 9 September. From 10 to 30 September, the integrator and the quality department run the painting tests; on 30 September, they sign an acceptance certificate without reservations. Owing to insufficient orders, commercial production only starts on 15 October, and the cell runs at 40% of capacity in October and November. The management controller wants to capitalise everything relating to the project.","es":""},"exhibits":[{"title":{"fr":"","en":"Exhibit 1 — Project expenditure (EUR, excluding recoverable VAT)","es":""},"body":{"fr":"","en":"- Robotic cell, price net of trade discount: 820,000\n- Transport and lifting: 12,000\n- Installation by the integrator: 58,000\n- In-house project engineer: 400 hours on timesheets × EUR 75 hourly cost = 30,000\n- Painting tests from 10 to 30 September: 22,000\n- Operator training: 9,000\n- Operating losses for October and November (under-capacity): 35,000\n- Share of plant management costs: 15,000","es":""}}],"parts":[{"prompt":{"fr":"","en":"On what date should capitalisation of costs into the carrying amount of the cell stop?","es":""},"explanation":{"fr":"","en":"Judgment based on the facts: the acceptance certificate without reservations on 30 September shows that the cell is in the location and condition necessary to operate as intended. Capitalisation stops on that date (IAS 16, para. 20).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"9 September, end of assembly","es":""},"correct":false,"feedback":{"fr":"","en":"End of assembly on 9 September: the functioning tests are still to be carried out and are part of getting the asset ready, so the cell is not yet in the condition necessary to operate as intended. Capitalisation continues until the unconditional acceptance (IAS 16, paras. 17 and 20). Rule to remember: capitalisation stops when the asset is in the location and condition necessary, not at the end of assembly alone (IAS 16, para. 20).","es":""}},{"id":"B","text":{"fr":"","en":"30 September, acceptance without reservations","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"15 October, start of commercial production","es":""},"correct":false,"feedback":{"fr":"","en":"15 October is the date commercial production starts, delayed for lack of orders: that delay does not extend the period of getting the asset ready, since the cell was ready on 30 September. Costs incurred afterwards relate to the use of the asset (IAS 16, para. 20). Rule to remember: the commercial start-up is not the criterion; getting the asset ready is (IAS 16, para. 20).","es":""}},{"id":"D","text":{"fr":"","en":"When the cell reaches full capacity","es":""},"correct":false,"feedback":{"fr":"","en":"Waiting for full capacity would mean capitalising under-utilisation costs. Operating below capacity relates to the use of the asset, not to getting it ready: costs incurred while a ready asset operates below capacity are excluded from cost (IAS 16, para. 20). Rule to remember: the ramp-up does not extend the capitalisation period (IAS 16, para. 20).","es":""}}],"id":"P1","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"True or false: the project engineer's cost can be capitalised for the 400 hours documented on timesheets as spent on the installation, with the rest of the engineer's annual cost remaining an expense.","es":""},"explanation":{"fr":"","en":"True. Approach: look for the direct link between the engineer's hours and the installation. Employee benefits arising directly from the acquisition or construction of the asset are directly attributable costs (IAS 16, para. 17). The timesheets establish this direct link; the rest of the salary, with no demonstrated link to the cell, remains an expense. Case convention: the hourly cost of EUR 75 contains no overheads. Rule to remember: hours whose direct link with the installation is shown by timesheets are included in cost (IAS 16, para. 17).","es":""},"common_error":{"fr":"","en":"Capitalising the engineer's whole annual salary, or none of it: only hours with a documented direct link to the installation are included in cost.","es":""},"format":"TRUE_FALSE","answer":true,"id":"P2","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"Using Exhibit 1, calculate the initial cost of the cell and the total project expenditure to be expensed.","es":""},"explanation":{"fr":"","en":"Approach: classify each item of expenditure in document 1. Cost: 820,000 + 12,000 + 58,000 + 30,000 + 22,000 = EUR 942,000 (IAS 16, paras. 16 and 17). Expenses: training 9,000 and management costs 15,000 (IAS 16, para. 19), under-utilisation losses 35,000 (IAS 16, para. 20), i.e. EUR 59,000. Check: 942,000 + 59,000 = 1,001,000. Rule to remember: cost includes directly attributable costs up to the point of readiness; training, management costs and under-utilisation losses go to expenses (IAS 16, paras. 19 and 20).","es":""},"common_error":{"fr":"","en":"Including training, management costs or initial operating losses in the cell's cost: they are expenses.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Total expenditure in Exhibit 1","es":""},"value":"1001000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Initial cost of the cell","es":""},"answer":942000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Expenditure expensed","es":""},"answer":59000,"tolerance":0,"unit":"EUR"}],"id":"P3","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Initial cost of the cell","es":""},"expression":"a + b + c + d + e","variables":[{"symbol":"a","meaning":{"fr":"","en":"- Robotic cell, price net of trade discount: 820,000","es":""},"value":820000},{"symbol":"b","meaning":{"fr":"","en":"- Transport and lifting: 12,000","es":""},"value":12000},{"symbol":"c","meaning":{"fr":"","en":"- Installation by the integrator: 58,000","es":""},"value":58000},{"symbol":"d","meaning":{"fr":"","en":"hourly cost = 30,000","es":""},"value":30000},{"symbol":"e","meaning":{"fr":"","en":"September: 22,000","es":""},"value":22000}],"result":942000,"unit":"EUR"}],"rationale":{"fr":"","en":"cost includes directly attributable costs up to the point of readiness; training, management costs and under-utilisation losses go to expenses (IAS 16, paras. 19 and 20).","es":""},"references":["REF.IAS16.16","REF.IAS16.17","REF.IAS16.19","REF.IAS16.20"]}},{"prompt":{"fr":"","en":"Which documents should the working paper contain to support the capitalised cost?","es":""},"explanation":{"fr":"","en":"The file must allow the calculation to be redone: invoices (price net of discount, IAS 16, para. 16), evidence of the direct link of internal costs (IAS 16, para. 17) and the document fixing the date capitalisation ends (IAS 16, para. 20). Choosing these documents is good documentation practice, not a list prescribed by the standard.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The acceptance certificate of 30 September","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The engineer's timesheets and the hourly cost calculation","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The supplier and integrator invoices, showing the discount","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"An expert valuation of the cell, to support the amount recorded","es":""},"correct":false,"feedback":{"fr":"","en":"An expert valuation does not support the amount recorded: the asset is measured at cost (IAS 16, para. 15), built up from invoices, the price net of discount and the proven directly attributable costs (IAS 16, paras. 16 and 17). A market value does not replace these documents. Rule to remember: a cost is supported by its documents, not by an expert valuation.","es":""}},{"id":"E","text":{"fr":"","en":"The sales forecasts for the new colour range","es":""},"correct":false,"feedback":{"fr":"","en":"Sales forecasts establish no element of the asset's cost: cost is made up of the net purchase price and the directly attributable costs of getting the asset ready (IAS 16, paras. 16 and 17). They prove neither an amount paid nor a direct link with the cell. Rule to remember: the file supports cost with costs actually incurred, not with commercial forecasts.","es":""}}],"id":"P4","dimension":"DOCUMENTATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000019","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.EXCLUSIONS"],"dimension":"RULE_KNOWLEDGE","format":"MATCHING","context":"GENERIC","tested_point":"EXCLUSIONS_APPLICABLE_STANDARD","difficulty":"BEGINNER","estimated_time_s":75,"lesson_id":"LS.IAS16.000002","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"exclusions"},"references":["IAS 16 §3"],"exercise":{"prompt":{"fr":"","en":"Match each asset excluded from IAS 16 with the standard that governs it.","es":""},"explanation":{"fr":"","en":"Steps: for each asset, identify the regime that applies instead of IAS 16. IAS 16 excludes in particular assets held for sale (IFRS 5), biological assets related to agricultural activity other than bearer plants (IAS 41) and the recognition and measurement of exploration and evaluation assets (IFRS 6) (IAS 16, para. 3). The warehouse classified as held for sale therefore falls under IFRS 5, the flock of ewes under IAS 41 and the exploration and evaluation assets under IFRS 6. IAS 2 (inventories) covers none of these three assets. Main trap: believing that an animal used for several years is an item of property, plant and equipment. Rule to remember: before applying IAS 16, check that the asset is not excluded by its scope.","es":""},"common_error":{"fr":"","en":"Thinking that livestock, used for several years, is property, plant and equipment.","es":""},"format":"MATCHING","left":[{"id":"L1","text":{"fr":"","en":"Warehouse classified as held for sale","es":""}},{"id":"L2","text":{"fr":"","en":"A sheep farm's flock of ewes","es":""}},{"id":"L3","text":{"fr":"","en":"A mining company's exploration and evaluation assets","es":""}}],"right":[{"id":"R1","text":{"fr":"","en":"IFRS 5","es":""}},{"id":"R2","text":{"fr":"","en":"IAS 41","es":""}},{"id":"R3","text":{"fr":"","en":"IFRS 6","es":""}},{"id":"R4","text":{"fr":"","en":"IAS 2","es":""}}],"pairs":[{"left":"L1","right":"R1"},{"left":"L2","right":"R2"},{"left":"L3","right":"R3"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000020","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.EXCLUSIONS","IAS16.SCOPE.GENERAL"],"dimension":"APPLICATION","format":"CLASSIFICATION","context":"MINING","tested_point":"EQUIPMENT_USED_FOR_EXCLUDED_ASSETS","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000002","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"exclusions"},"references":["IAS 16 §2","IAS 16 §3"],"exercise":{"prompt":{"fr":"","en":"Case data: a mining company operates a copper mine and is exploring a new deposit. Classify each asset.","es":""},"explanation":{"fr":"","en":"Steps: distinguish two levels. Mining rights, mineral reserves and exploration and evaluation assets are outside the scope of IAS 16 (IAS 16, para. 3). However, IAS 16 still applies to items of property, plant and equipment used to develop or maintain those assets, here the haul trucks, the concentration plant, the camp and the maintenance workshops (IAS 16, paras. 2 and 3). Main trap: excluding the whole mining activity, equipment included. Rule to remember: the exclusion covers the right, the reserve and the exploration, not the equipment used to exploit them.","es":""},"common_error":{"fr":"","en":"Excluding all assets of a mining business from IAS 16, including the equipment.","es":""},"format":"CLASSIFICATION","categories":[{"id":"IAS16","text":{"fr":"","en":"Within IAS 16","es":""}},{"id":"EXCLUDED","text":{"fr":"","en":"Excluded from IAS 16","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"The ore reserves of the operating mine","es":""},"category":"EXCLUDED"},{"id":"I2","text":{"fr":"","en":"The haul trucks carrying the ore","es":""},"category":"IAS16"},{"id":"I3","text":{"fr":"","en":"The exploration and evaluation assets of the new deposit","es":""},"category":"EXCLUDED"},{"id":"I4","text":{"fr":"","en":"The ore concentration plant","es":""},"category":"IAS16"},{"id":"I5","text":{"fr":"","en":"The mineral rights obtained from the State","es":""},"category":"EXCLUDED"},{"id":"I6","text":{"fr":"","en":"The site camp and maintenance workshops","es":""},"category":"IAS16"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000021","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.BEARER_PLANTS"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"AGRICULTURE","tested_point":"BEARER_PLANT_VS_PRODUCE","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000002","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"bearer-plants"},"references":["IAS 16 §3","IAS 16 §6"],"exercise":{"prompt":{"fr":"","en":"Case data: an agri-business group runs a 25-year-old oil palm plantation. At year end, fruit bunches are ripening on the palms. Which analysis is correct?","es":""},"explanation":{"fr":"","en":"A living plant that bears produce for more than one period and has only a remote likelihood of being sold as agricultural produce is a bearer plant within IAS 16; the produce growing on it falls within IAS 41 (IAS 16, paras. 3 and 6).","es":""},"common_error":{"fr":"","en":"Applying IAS 41 to the whole plantation because palm trees are living things, without separating the bearer plant from the produce growing on it.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Palms and bunches fall within IAS 41, as they are biological assets.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer applies IAS 41 to both items because they are living assets. But a living plant that bears produce over more than one period and has a remote likelihood of being sold as agricultural produce is a bearer plant, excluded from IAS 41 and accounted for under IAS 16 (IAS 16, paras. 3 and 6). Rule to remember: being alive is not enough; it is the bearer-plant function that points to IAS 16.","es":""}},{"id":"B","text":{"fr":"","en":"The palms fall within IAS 16; the growing bunches fall within IAS 41.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Palms and bunches form a single asset within IAS 16.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer merges the plant and its produce into a single IAS 16 asset. The bearer plant falls within IAS 16; the produce growing on it, such as ripening bunches, is a separate biological asset that falls within IAS 41 (IAS 16, paras. 3 and 6). Example: at the reporting date, the ripening bunches are monitored separately from the carrying amount of the palms. Rule to remember: the bearer plant and the produce it carries are two assets, governed by two standards.","es":""}},{"id":"D","text":{"fr":"","en":"The palms are inventory, as they will eventually be felled.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer sees inventories because the palms will eventually be felled. But felling at end of life, with a possible incidental sale of scrap, does not prevent classification as a bearer plant: the definition rests on a remote likelihood of sale as agricultural produce (IAS 16, para. 6). The palms are used for 25 years to bear fruit, so they fall under IAS 16, not IAS 2. Rule to remember: removal at the end of its life does not turn a bearer plant into inventory.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000022","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.BEARER_PLANTS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"AGRICULTURE","tested_point":"BEARER_PLANT_ONLY_PLANTS","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS16.000002","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"bearer-plants"},"references":["IAS 16 §3","IAS 16 §6"],"exercise":{"prompt":{"fr":"","en":"A herd of dairy cows, kept for six years for its milk production, meets the definition of a bearer plant and therefore falls within IAS 16.","es":""},"explanation":{"fr":"","en":"False. Steps: (1) reread the definition of a bearer plant: it covers living plants only (IAS 16, para. 6); (2) dairy cows are animals, not plants; (3) they are therefore biological assets other than bearer plants, excluded from IAS 16 and governed by IAS 41 (IAS 16, para. 3). The fact that the herd produces milk for six years does not change the nature of the asset. Main trap: extending the 'produces over several periods' logic to every biological asset. Rule to remember: a bearer plant is a living plant; an animal is not one (IAS 16, para. 6).","es":""},"common_error":{"fr":"","en":"Extending the \"bears produce over several periods\" logic to all biological assets, including animals.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000023","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.BEARER_PLANTS"],"dimension":"ANALYSIS","format":"MINI_CASE","context":"AGRICULTURE","tested_point":"BEARER_PLANT_COSTS_BEFORE_MATURITY","difficulty":"EXPERT","estimated_time_s":300,"lesson_id":"LS.IAS16.000002","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"bearer-plants"},"references":["IAS 16 §19","IAS 16 §22","IAS 16 §22A","IAS 16 §55"],"exercise":{"prompt":{"fr":"","en":"Analyse the treatment of an apple orchard up to the point it starts producing.","es":""},"explanation":{"fr":"","en":"Steps: (1) Before maturity, an apple orchard is a bearer plant: it is accounted for as a self-constructed asset, on the same principles as an acquired asset (IAS 16, paras. 22 and 22A). (2) Directly attributable costs are therefore accumulated: plants 60,000 + planting labour 25,000 + irrigation, pruning and fertilisation of the young trees 45,000 = EUR 130,000. (3) The share of head office administrative costs (EUR 8,000) is an excluded cost, expensed (IAS 16, para. 19). (4) Depreciation starts only at maturity, when the orchard is ready for use, i.e. in N+3 (IAS 16, para. 55). Main trap: expensing growth costs, or depreciating from planting. Rule to remember: before maturity, directly attributable costs accumulate in the asset; depreciation starts when the asset is ready for use.","es":""},"common_error":{"fr":"","en":"Expensing the costs of young trees before the first harvest, or measuring them at fair value under IAS 41, instead of accumulating them as a self-constructed asset.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"A fruit grower plants a new apple orchard at the start of N. The trees will only give a usable harvest from N+3; they will then be used for about twenty years and only sold as firewood at the end of their life. The costs incurred from N to N+2, before maturity, are detailed below.","es":""},"exhibits":[{"title":{"fr":"","en":"Costs N to N+2","es":""},"body":{"fr":"","en":"Seedlings purchased: 60,000. Planting labour (timesheets): 25,000. Irrigation, pruning and fertilising directly related to the young trees: 45,000. Share of head office administrative costs: 8,000.","es":""}}],"parts":[{"prompt":{"fr":"","en":"How are the costs directly related to the young trees treated before maturity?","es":""},"explanation":{"fr":"","en":"Approach: look at the condition of the plant. Bearer plants are accounted for as self-constructed assets until they are in the location and condition for their intended operation (IAS 16, para. 22A). Rule to remember: before maturity, an orchard is accounted for as a self-constructed asset, with directly attributable costs accumulated (IAS 16, paras. 22 and 22A).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"They are accumulated as for a self-constructed asset.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"They are measured at fair value under IAS 41.","es":""},"correct":false,"feedback":{"fr":"","en":"Apple trees are bearer plants: before maturity they are accounted for as self-constructed assets (IAS 16, para. 22A), not measured at fair value under IAS 41. Their directly attributable costs therefore accumulate in their carrying amount. Rule to remember: a bearer plant follows IAS 16 as a self-constructed asset until it is in a condition to produce (IAS 16, para. 22A).","es":""}},{"id":"C","text":{"fr":"","en":"They are expensed until there is a harvest.","es":""},"correct":false,"feedback":{"fr":"","en":"Before maturity, the plant is under construction: its directly attributable costs accumulate in its carrying amount instead of being expensed (IAS 16, para. 22A). Expensing them would distort the cost of the orchard and the profit or loss of the growing years. Rule to remember: as long as the plant is not in a condition to produce, its directly attributable costs are accumulated in the asset (IAS 16, paras. 22 and 22A).","es":""}}],"id":"P1","dimension":"RULE_KNOWLEDGE"},{"prompt":{"fr":"","en":"Calculate the carrying amount of the orchard when it reaches maturity.","es":""},"explanation":{"fr":"","en":"Approach: add up the directly attributable costs and set aside general overheads. 60,000 + 25,000 + 45,000 = 130,000. General administrative costs stay in expenses: a self-constructed asset follows the same principles as an acquired one (IAS 16, paras. 19 and 22). Rule to remember: the cost of a self-constructed asset includes directly attributable costs, not administrative costs (IAS 16, paras. 19 and 22).","es":""},"common_error":{"fr":"","en":"Adding head office administrative costs to the orchard's cost: a self-constructed asset includes only directly attributable costs.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Seedlings","es":""},"value":"60000","unit":"EUR"},{"label":{"fr":"","en":"Planting labour","es":""},"value":"25000","unit":"EUR"},{"label":{"fr":"","en":"Irrigation, pruning, fertilising","es":""},"value":"45000","unit":"EUR"},{"label":{"fr":"","en":"Head office administrative costs","es":""},"value":"8000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Carrying amount at maturity","es":""},"answer":130000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Carrying amount at maturity","es":""},"expression":"a + b + c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Seedlings","es":""},"value":60000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Planting labour","es":""},"value":25000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Irrigation, pruning, fertilising","es":""},"value":45000,"unit":"EUR"}],"result":130000,"unit":"EUR"}],"rationale":{"fr":"","en":"the cost of a self-constructed asset includes directly attributable costs, not administrative costs (IAS 16, paras. 19 and 22).","es":""},"references":["REF.IAS16.19","REF.IAS16.22"]}},{"prompt":{"fr":"","en":"Depreciation of the orchard starts at planting, at the beginning of N.","es":""},"explanation":{"fr":"","en":"False. Approach: find the date on which the orchard is ready for use. Depreciation begins when the asset is available for use (IAS 16, para. 55), i.e. when the orchard can produce as intended, in N+3 in this case. Trap: depreciating from planting. Rule to remember: depreciation begins when the asset enters operation, not at planting (IAS 16, para. 55).","es":""},"common_error":{"fr":"","en":"Depreciating from planting: depreciation starts when the orchard is ready to produce as intended.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P3","dimension":"APPLICATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000024","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.INVESTMENT_PROPERTY_COST_MODEL"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"REAL_ESTATE","tested_point":"INVESTMENT_PROPERTY_COST_MODEL_REFERENCE","difficulty":"ADVANCED","estimated_time_s":75,"lesson_id":"LS.IAS16.000002","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"investment-property"},"references":["IAS 16 §5","IAS 16 §30"],"exercise":{"prompt":{"fr":"","en":"Case data: a property company owns an office building let to third parties, classified as investment property. It has chosen the IAS 40 cost model. How is this building measured after initial recognition?","es":""},"explanation":{"fr":"","en":"An entity applying the IAS 40 cost model applies the IAS 16 cost model to its owned investment property (IAS 16, para. 5): cost less accumulated depreciation and accumulated impairment losses (IAS 16, para. 30).","es":""},"common_error":{"fr":"","en":"Believing that the IAS 40 cost model freezes the property at its original cost, with no depreciation or impairment.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It is reclassified as property, plant and equipment and follows IAS 16 in full.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer infers a change of category. But paragraph 5 merely applies the IAS 16 cost measurement model to investment property held by the owner (IAS 16, para. 5): the building let to third parties remains investment property and does not become property, plant and equipment. Example: a property company that depreciates its office building does not thereby present it with its machinery. Rule to remember: IAS 16 supplies the measurement method here, not the asset's category.","es":""}},{"id":"B","text":{"fr":"","en":"It remains investment property, measured under the IAS 16 cost model: cost less accumulated depreciation and impairment losses.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"It is kept at historical cost, without depreciation.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer keeps historical cost with no depreciation. But the IAS 16 cost model measures the building at cost less accumulated depreciation and accumulated impairment losses (IAS 16, para. 30): cost is not frozen after initial recognition. Example: a EUR 1,000,000 building depreciated by EUR 20,000 a year stands at EUR 980,000 after one year, before any impairment. Rule to remember: cost model = cost less accumulated depreciation and accumulated impairment losses.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000025","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.EXCLUSIONS"],"dimension":"ANALYSIS","format":"MINI_CASE","context":"AUTOMOTIVE","tested_point":"HELD_FOR_SALE_CHANGE_OF_STANDARD","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000002","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"judgment"},"references":["IAS 16 §3","IAS 16 §55"],"exercise":{"prompt":{"fr":"","en":"Analyse the effect of classifying a production line as held for sale.","es":""},"explanation":{"fr":"","en":"Steps: (1) As the IFRS 5 conditions are met on 30 September N (case data), the line is classified as held for sale: it leaves the scope of IAS 16 and falls under IFRS 5 (IAS 16, para. 3). (2) Depreciation stops at the earlier of the date of that classification and derecognition (IAS 16, para. 55): here 30 September. (3) The IAS 16 charge for year N therefore covers 9 months: 12,000 × 9/12 = EUR 9,000. (4) The fact that the line is still physically used from October to December changes nothing. Main trap: continuing to depreciate while the asset is still in use. Rule to remember: IAS 16 depreciation stops on classification as held for sale, even if the asset is still in use.","es":""},"common_error":{"fr":"","en":"Continuing to depreciate the line as long as it is physically used, even though classification as held for sale has already stopped depreciation under IAS 16.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"An automotive supplier depreciates a stamping line on a straight-line basis, at 12,000 a year. On 30 September N, management decides to sell it and all the IFRS 5 conditions for classifying it as held for sale are met on that date (case data). The year end is 31 December.","es":""},"parts":[{"prompt":{"fr":"","en":"Which standard governs the line from 30 September N?","es":""},"explanation":{"fr":"","en":"Approach: find how the line is classified. IAS 16 excludes items of property, plant and equipment classified as held for sale, which fall under IFRS 5 (IAS 16, para. 3). Rule to remember: the line classified as held for sale falls under IFRS 5, no longer IAS 16 (IAS 16, para. 3).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"IAS 16","es":""},"correct":false,"feedback":{"fr":"","en":"IAS 16 excludes assets classified as held for sale (IAS 16, para. 3): from 30 September, the line falls under IFRS 5 and no longer under IAS 16. Still accounting for it under IAS 16 would ignore that classification. Rule to remember: an asset classified as held for sale falls outside the scope of IAS 16 (IAS 16, para. 3).","es":""}},{"id":"B","text":{"fr":"","en":"IFRS 5","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"IAS 2","es":""},"correct":false,"feedback":{"fr":"","en":"The line is not sold in the ordinary course of the equipment maker's business: it is an item of property, plant and equipment that management decides to sell, not inventory. It is classified as held for sale, which places it under IFRS 5 (IAS 16, para. 3). Rule to remember: deciding to sell an item of property, plant and equipment does not turn it into inventory; the IFRS 5 classification takes it out of IAS 16 (IAS 16, para. 3).","es":""}}],"id":"P1","dimension":"RECOGNITION"},{"prompt":{"fr":"","en":"Calculate the IAS 16 depreciation charge for N.","es":""},"explanation":{"fr":"","en":"Approach: depreciation stops at the date of classification, so count 9 months (January to September). Depreciation ceases at the date of classification as held for sale (IAS 16, para. 55): 12,000 × 9/12 = 9,000. Rule to remember: the IAS 16 charge stops at the date of classification as held for sale (IAS 16, para. 55).","es":""},"common_error":{"fr":"","en":"Charging 12 months of depreciation: IAS 16 depreciation stops at the date of classification as held for sale.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Annual charge","es":""},"value":"12000","unit":"EUR"},{"label":{"fr":"","en":"Classification date","es":""},"value":"30/09","unit":"TEXT"}],"steps":[{"id":"S1","label":{"fr":"","en":"N charge under IAS 16","es":""},"answer":9000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"N charge under IAS 16","es":""},"expression":"a * 9 / 12","variables":[{"symbol":"a","meaning":{"fr":"","en":"Annual charge","es":""},"value":12000,"unit":"EUR"}],"result":9000,"unit":"EUR","rationale":{"fr":"","en":"Depreciation ceases at the date of classification as held for sale (IAS 16, para. 55): 12,000 × 9/12 = 9,000.","es":""}}],"rationale":{"fr":"","en":"the IAS 16 charge stops at the date of classification as held for sale (IAS 16, para. 55).","es":""},"references":["REF.IAS16.55"]}},{"prompt":{"fr":"","en":"Since the line is still physically used until it is sold, the entity continues to depreciate it under IAS 16 from October to December.","es":""},"explanation":{"fr":"","en":"False. Approach: check whether the asset is classified as held for sale. Depreciation under IAS 16 ceases at the date on which the asset is classified as held for sale (IAS 16, para. 55); its treatment then falls under IFRS 5. Trap: continuing to depreciate because the asset is still in use. Rule to remember: physical use does not prolong depreciation under IAS 16 after classification (IAS 16, para. 55).","es":""},"common_error":{"fr":"","en":"Continuing to depreciate because the line is still in use: after classification as held for sale, IAS 16 depreciation stops.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P3","dimension":"RULE_KNOWLEDGE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000026","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.GENERAL","IAS16.SCOPE.EXCLUSIONS","IAS16.SCOPE.BEARER_PLANTS"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"AGRICULTURE","tested_point":"SCOPE_REVIEW_NOTE","difficulty":"INTERMEDIATE","estimated_time_s":150,"lesson_id":"LS.IAS16.000002","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"how"},"references":["IAS 16 §2","IAS 16 §3","IAS 16 §6"],"exercise":{"prompt":{"fr":"","en":"Case data: an assistant drafted the scope memo for a fruit cooperative. Spot the incorrect statements.","es":""},"explanation":{"fr":"","en":"Steps: for each statement, ask which asset is concerned and whether paragraph 3 takes it out of scope. The bearer plant falls within IAS 16, but growing fruit are biological assets other than bearer plants: they are excluded (IAS 16, para. 3). Tractors and sprayers are items of property, plant and equipment used to develop or maintain biological assets: IAS 16 applies (IAS 16, para. 3). Walnut trees planted to be felled and sold as timber are not bearer plants (IAS 16, para. 6). Trap: adding the fruit to the carrying amount of the tree, or excluding the equipment that serves an agricultural activity. Rule to remember: IAS 16 applies to property, plant and equipment unless excluded (IAS 16, paras. 2 and 3); equipment used to develop or maintain biological assets stays within it.","es":""},"common_error":{"fr":"","en":"Adding the fruit ripening on a tree to the tree's carrying amount, or excluding from IAS 16 the equipment that serves an agricultural activity.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The producing cherry trees are bearer plants and fall within IAS 16.","es":""},"erroneous":false},{"id":"S2","text":{"fr":"","en":"The cherries ripening on the trees are part of the carrying amount of the cherry trees.","es":""},"erroneous":true,"correction":{"fr":"","en":"The growing fruit are biological assets other than bearer plants: they fall within IAS 41 (IAS 16, para. 3).","es":""}},{"id":"S3","text":{"fr":"","en":"The tractors and sprayers serve biological assets: they are therefore excluded from IAS 16.","es":""},"erroneous":true,"correction":{"fr":"","en":"IAS 16 applies to property, plant and equipment used to develop or maintain biological assets (IAS 16, para. 3).","es":""}},{"id":"S4","text":{"fr":"","en":"The packing station and its cold rooms fall within IAS 16, as no other standard provides a different treatment.","es":""},"erroneous":false},{"id":"S5","text":{"fr":"","en":"An orchard of walnut trees planted solely to be felled and sold as timber is a bearer plant.","es":""},"erroneous":true,"correction":{"fr":"","en":"Trees intended to be sold as produce do not meet the condition of a remote likelihood of sale as agricultural produce (IAS 16, para. 6): they fall within IAS 41.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000027","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.OBJECTIVE"],"dimension":"RULE_KNOWLEDGE","format":"MULTIPLE_CHOICE","context":"HEALTHCARE","tested_point":"OBJECTIVE_QUESTIONS_ADDRESSED","difficulty":"BEGINNER","estimated_time_s":60,"lesson_id":"LS.IAS16.000002","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"understand"},"references":["IAS 16 §1"],"exercise":{"prompt":{"fr":"","en":"Case data: a clinic has just acquired an MRI scanner. Which of the following questions fall within the purpose of IAS 16? (Several answers possible.)","es":""},"explanation":{"fr":"","en":"IAS 16 deals with the recognition of assets, the determination of their carrying amounts, and the depreciation charges and impairment losses to be recognised (IAS 16, para. 1). Revenue falls within another standard.","es":""},"common_error":{"fr":"","en":"Confusing what IAS 16 covers (the asset and its depreciation) with what the asset generates (revenue), which falls under another standard.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Should the scanner be recognised in the balance sheet, and from what date?","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"At what amount is the scanner carried in the balance sheet at each year end?","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"What depreciation charge should be recognised each year?","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"When should the revenue from scans billed to patients be recognised?","es":""},"correct":false,"feedback":{"fr":"","en":"This question concerns the revenue from billing examinations to patients, not the machine itself. IAS 16 deals with the recognition of property, plant and equipment, its carrying amount, depreciation and impairment losses (IAS 16, para. 1), not with revenue. The MRI scanner is the asset that makes it possible to earn that revenue, but its recognition falls under another standard. Rule to remember: IAS 16 deals with the asset; the revenue it helps to generate falls under another standard (IAS 16, para. 1).","es":""}},{"id":"E","text":{"fr":"","en":"Should an impairment loss be recognised if the scanner becomes obsolete?","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000028","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.PPE"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"TELECOM","tested_point":"PPE_VS_INVENTORY_VS_INTANGIBLE","difficulty":"INTERMEDIATE","estimated_time_s":100,"lesson_id":"LS.IAS16.000003","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"ppe-boundaries"},"references":["IAS 16 §6","IAS 2 §6","IAS 38 §4","IAS 38 §8"],"exercise":{"prompt":{"fr":"","en":"Case data: a telecom operator lists its assets. Classify each one in the right category.","es":""},"explanation":{"fr":"","en":"Steps: for each asset, ask whether it is physical, whether it is held for sale or consumed in the business, and otherwise how long it is used. Towers and fibre optic cable are physical assets used over more than one period: property, plant and equipment (IAS 16, para. 6). Smartphones and SIM cards, held to be sold or supplied to customers, are inventories (IAS 2, para. 6). The spectrum licence and the billing software that can be separated from the hardware are assets without physical substance: intangible assets (IAS 38, paras. 4 and 8). Main trap: classifying every physical item held as an asset, without checking whether it is meant to be sold. Rule to remember: the nature of the asset (physical or not) and its use (sale or use over several periods) determine the standard.","es":""},"common_error":{"fr":"","en":"Classifying every physical item held by the entity as an asset, without checking whether it is held for sale.","es":""},"format":"CLASSIFICATION","categories":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"INVENTORY","text":{"fr":"","en":"Inventory","es":""}},{"id":"INTANGIBLE","text":{"fr":"","en":"Intangible asset","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Mobile network masts and antennas, used for 15 years","es":""},"category":"PPE"},{"id":"I2","text":{"fr":"","en":"Smartphones in shops, to be sold to subscribers","es":""},"category":"INVENTORY"},{"id":"I3","text":{"fr":"","en":"Spectrum licence granted for 20 years","es":""},"category":"INTANGIBLE"},{"id":"I4","text":{"fr":"","en":"Fibre-optic cables laid in the network","es":""},"category":"PPE"},{"id":"I5","text":{"fr":"","en":"Billing software bought separately, installable on any server","es":""},"category":"INTANGIBLE"},{"id":"I6","text":{"fr":"","en":"SIM cards in stock, for new customers","es":""},"category":"INVENTORY"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000029","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.PPE"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"MANUFACTURING","tested_point":"PPE_MORE_THAN_ONE_PERIOD","difficulty":"BEGINNER","estimated_time_s":40,"lesson_id":"LS.IAS16.000003","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"understand"},"references":["IAS 16 §6","IAS 2 §6"],"exercise":{"prompt":{"fr":"","en":"Case data: a furniture maker buys saw blades that wear out and are thrown away within three months. These blades do not meet the definition of property, plant and equipment.","es":""},"explanation":{"fr":"","en":"True. Steps: (1) one of the conditions for an item of property, plant and equipment is that it is expected to be used during more than one period (IAS 16, para. 6); (2) saw blades worn out and discarded within three months do not meet that condition; (3) they are supplies consumed in production, hence inventories, expensed as they are used (IAS 2, para. 6). The fact that they are a production tool is not enough. Main trap: assuming every production tool is an asset. Rule to remember: without use over more than one period, an item is not property, plant and equipment.","es":""},"common_error":{"fr":"","en":"Assuming every tool used in production is property, plant and equipment, whatever its period of use.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000030","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.MEASUREMENT_TERMS"],"dimension":"RULE_KNOWLEDGE","format":"ORDERING","context":"GENERIC","tested_point":"MEASUREMENT_TERMS_SEQUENCE","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000003","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"how"},"references":["IAS 16 §6","IAS 16 §30","IAS 16 §50","IAS 16 §53"],"exercise":{"prompt":{"fr":"","en":"Put in order the steps that lead from the cost of an item to its carrying amount.","es":""},"explanation":{"fr":"","en":"Steps: follow the path from cost to carrying amount. (1) Determine the cost of the asset. (2) Deduct the residual value to obtain the depreciable amount (IAS 16, para. 53). (3) Allocate that amount systematically over the useful life (IAS 16, para. 50). (4) Accumulate the charges of the years elapsed. (5) Deduct accumulated depreciation and impairment losses from cost: this is the carrying amount (IAS 16, paras. 6 and 30). Main trap: applying the residual value a second time when computing the carrying amount. This order is a teaching working approach, not a sequence imposed by the standard. Rule to remember: the residual value sets the depreciable amount, and the carrying amount is computed from cost.","es":""},"common_error":{"fr":"","en":"Deducting the residual value from cost to obtain the carrying amount, instead of using it only to determine the depreciable amount.","es":""},"format":"ORDERING","steps":[{"id":"S1","text":{"fr":"","en":"Determine the cost of the asset","es":""}},{"id":"S2","text":{"fr":"","en":"Deduct residual value to obtain the depreciable amount","es":""}},{"id":"S3","text":{"fr":"","en":"Allocate the depreciable amount over the useful life","es":""}},{"id":"S4","text":{"fr":"","en":"Accumulate the charges of the elapsed periods","es":""}},{"id":"S5","text":{"fr":"","en":"Deduct accumulated depreciation and impairment losses from cost","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000031","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.MEASUREMENT_TERMS"],"dimension":"CALCULATION","format":"CALCULATION","context":"FOOD_INDUSTRY","tested_point":"DEPRECIABLE_AMOUNT_AND_CARRYING_AMOUNT","difficulty":"INTERMEDIATE","estimated_time_s":150,"lesson_id":"LS.IAS16.000003","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"numeric-chain"},"references":["IAS 16 §30","IAS 16 §50","IAS 16 §53"],"exercise":{"prompt":{"fr":"","en":"Case data: a dairy acquires a packaging machine on 1 January N. Teaching assumption: straight-line method, no impairment loss. Calculate the amounts requested.","es":""},"explanation":{"fr":"","en":"Steps: (1) Depreciable amount = cost − residual value = 90,000 − 6,000 = EUR 84,000 (IAS 16, para. 53). (2) Annual straight-line charge = 84,000 / 7 years = EUR 12,000 (IAS 16, para. 50). (3) After 3 years (end of N+2), accumulated depreciation = 3 × 12,000 = EUR 36,000; carrying amount = cost − accumulated depreciation = 90,000 − 36,000 = EUR 54,000, with no impairment (IAS 16, para. 30). Main trap: deducting the residual value a second time, which gives EUR 48,000. Rule to remember: the residual value reduces the depreciable amount, but the carrying amount starts from the full cost.","es":""},"common_error":{"fr":"","en":"Deducting residual value a second time from the carrying amount (48,000 instead of 54,000).","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost","es":""},"value":"90000","unit":"EUR"},{"label":{"fr":"","en":"Estimated residual value","es":""},"value":"6000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"7","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Depreciable amount","es":""},"answer":84000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Annual depreciation charge","es":""},"answer":12000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Carrying amount at the end of N+2 (after 3 years)","es":""},"answer":54000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Depreciable amount","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":90000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Estimated residual value","es":""},"value":6000,"unit":"EUR"}],"result":84000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Annual depreciation charge","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Depreciable amount","es":""},"value":84000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Useful life","es":""},"value":7,"unit":"YEARS"}],"result":12000,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Carrying amount at the end of N+2 (after 3 years)","es":""},"expression":"a - (3 * b)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":90000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Annual depreciation charge","es":""},"value":12000,"unit":"EUR"}],"result":54000,"unit":"EUR"}],"rationale":{"fr":"","en":"the residual value reduces the depreciable amount, but the carrying amount starts from the full cost.","es":""},"references":["REF.IAS16.30","REF.IAS16.50","REF.IAS16.53"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000032","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.MEASUREMENT_TERMS"],"dimension":"CALCULATION","format":"FILL_BLANK","context":"CONSTRUCTION","tested_point":"RESIDUAL_VALUE_EFFECT_ON_CHARGE","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS16.000003","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"numeric-chain"},"references":["IAS 16 §50","IAS 16 §53"],"exercise":{"prompt":{"fr":"","en":"Case data: a construction company buys a tower crane for 300,000. It estimates its residual value at 60,000 and its useful life at 8 years. Teaching assumption: straight-line method.","es":""},"explanation":{"fr":"","en":"Steps: (1) Depreciable amount = 300,000 − 60,000 = 240,000 (IAS 16, para. 53). (2) Annual straight-line charge = 240,000 / 8 = 30,000 (IAS 16, para. 50). (3) With a nil residual value, the depreciable amount would be 300,000 and the charge 300,000 / 8 = 37,500: it would be higher. The lower the estimated residual value, the higher the depreciable amount and the charge. Main trap: forgetting to deduct the residual value and depreciating the full cost. Rule to remember: the straight-line charge is computed on cost less residual value.","es":""},"common_error":{"fr":"","en":"Forgetting to deduct the residual value and computing the charge on the full cost (37,500 instead of 30,000).","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"Depreciable amount: {{da}}; annual charge: {{dep}}. Had residual value been estimated at zero from the outset, the annual charge would have been {{dir}}.","es":""},"blanks":[{"id":"da","mode":"NUMBER","answer":240000,"tolerance":0},{"id":"dep","mode":"NUMBER","answer":30000,"tolerance":0},{"id":"dir","mode":"CHOICE","choices":[{"id":"HIGHER","text":{"fr":"","en":"higher","es":""}},{"id":"LOWER","text":{"fr":"","en":"lower","es":""}},{"id":"SAME","text":{"fr":"","en":"the same","es":""}}],"answer":"HIGHER"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000033","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.MEASUREMENT_TERMS"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"LOGISTICS","tested_point":"MEASUREMENT_TERMS_MISCONCEPTIONS","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000003","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"pitfalls"},"references":["IAS 16 §6","IAS 16 §30","IAS 16 §52","IAS 16 §53","IAS 16 §57","IAS 36 §18"],"exercise":{"prompt":{"fr":"","en":"Case data: you are reviewing a colleague's working paper on a logistics company's truck fleet. Spot the incorrect statements.","es":""},"explanation":{"fr":"","en":"Steps: compare each statement with the matching concept. The depreciable amount is cost less residual value (IAS 16, paras. 6 and 53); the carrying amount is cost less accumulated depreciation and accumulated impairment losses, with no further deduction of residual value (IAS 16, para. 30); useful life depends on the asset's expected utility to the entity and may be shorter than its technical life (IAS 16, para. 57); the recoverable amount is the higher of fair value less costs of disposal and value in use (IAS 36, para. 18). Careful maintenance does not remove the need to depreciate (IAS 16, para. 52). Trap: confusing depreciable amount and carrying amount, or using the technical life. Rule to remember: depreciable amount = cost − residual value; carrying amount = cost − accumulated depreciation − accumulated impairment losses (IAS 16, paras. 30 and 53). Effect on the financial statements: a useful life that is too long would spread cost too slowly and overstate profit and carrying amount.","es":""},"common_error":{"fr":"","en":"Using the technical life as the useful life, or taking the lower of the two amounts as the recoverable amount.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The depreciable amount equals cost less residual value.","es":""},"erroneous":false},{"id":"S2","text":{"fr":"","en":"The carrying amount equals cost less accumulated depreciation and residual value.","es":""},"erroneous":true,"correction":{"fr":"","en":"Carrying amount = cost − accumulated depreciation − accumulated impairment losses; residual value is not deducted on top (IAS 16, para. 30).","es":""}},{"id":"S3","text":{"fr":"","en":"The useful life used is 12 years, the technical life of a truck, whereas the entity renews its fleet every 5 years.","es":""},"erroneous":true,"correction":{"fr":"","en":"Useful life depends on the expected utility to the entity and may be shorter than economic life: here 5 years (IAS 16, para. 57).","es":""}},{"id":"S4","text":{"fr":"","en":"Recoverable amount is the lower of fair value less costs of disposal and value in use.","es":""},"erroneous":true,"correction":{"fr":"","en":"It is the higher of the two (IAS 36, para. 18).","es":""}},{"id":"S5","text":{"fr":"","en":"The trucks have been carefully maintained; this care does not exempt them from depreciation.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000034","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.MEASUREMENT_TERMS"],"dimension":"CALCULATION","format":"CALCULATION","context":"PRINTING","tested_point":"RECOVERABLE_AMOUNT_AND_IMPAIRMENT_LOSS","difficulty":"ADVANCED","estimated_time_s":120,"lesson_id":"LS.IAS16.000003","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"measurement-terms"},"references":["IAS 16 §6","IAS 36 §18","IAS 36 §59"],"exercise":{"prompt":{"fr":"","en":"Case data: demand for paper catalogues collapses. At year end, a printer tests its rotary press. Calculate the recoverable amount and any impairment loss.","es":""},"explanation":{"fr":"","en":"Steps: (1) Recoverable amount is the higher of fair value less costs of disposal (52,000) and value in use (61,000): EUR 61,000 (IAS 36, para. 18). (2) Compare it with the carrying amount before the test, EUR 70,000. (3) The carrying amount exceeds the recoverable amount: the impairment loss is 70,000 − 61,000 = EUR 9,000 (IAS 36, para. 59; definition used in IAS 16, para. 6). Main trap: taking the lower of the two amounts, which would give a loss of EUR 18,000. Rule to remember: recoverable amount is the higher of the two amounts.","es":""},"common_error":{"fr":"","en":"Taking the lower of the two values and recognising a loss of 18,000.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Carrying amount before the test","es":""},"value":"70000","unit":"EUR"},{"label":{"fr":"","en":"Fair value less costs of disposal","es":""},"value":"52000","unit":"EUR"},{"label":{"fr":"","en":"Value in use","es":""},"value":"61000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Recoverable amount","es":""},"answer":61000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Impairment loss","es":""},"answer":9000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S2","meaning":{"fr":"","en":"Impairment loss","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount before the test","es":""},"value":70000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Value in use","es":""},"value":61000,"unit":"EUR"}],"result":9000,"unit":"EUR"}],"rationale":{"fr":"","en":"recoverable amount is the higher of the two amounts.","es":""},"references":["REF.IAS16.6","REF.IAS36.18","REF.IAS36.59"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000035","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.PPE"],"dimension":"APPLICATION","format":"MULTIPLE_CHOICE","context":"EQUIPMENT_RENTAL","tested_point":"PPE_RENTAL_AND_ADMINISTRATIVE_USE","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000003","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"understand"},"references":["IAS 16 §6","IAS 2 §6","IAS 38 §8"],"exercise":{"prompt":{"fr":"","en":"Case data: a construction equipment rental company that also does some trading lists its assets. Which are property, plant and equipment? (Several answers possible.)","es":""},"explanation":{"fr":"","en":"The definition covers physical items held for use in production or supply of services, rental to others or administrative purposes, used during more than one period (IAS 16, para. 6). Items held for resale are inventory (IAS 2, para. 6); the software is intangible (IAS 38, para. 8).","es":""},"common_error":{"fr":"","en":"Excluding assets let to third parties or the head office building from property, plant and equipment, or including assets bought for resale.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Mini excavators rented to customers over their 6 years of service","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Head office building occupied by the administrative teams","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"New generators bought to be resold as they are","es":""},"correct":false,"feedback":{"fr":"","en":"This answer picks generators that are bought to be resold as they are. An item of property, plant and equipment is held for use in production, supply of services, rental to others or administrative purposes, and is expected to be used during more than one period (IAS 16, para. 6). Goods held for sale in the ordinary course of business are inventories (IAS 2, para. 6). Rule to remember: the purpose for which the item is held (resale or use) determines the category.","es":""}},{"id":"D","text":{"fr":"","en":"Online booking software acquired from a publisher","es":""},"correct":false,"feedback":{"fr":"","en":"This answer selects the booking software because it serves the business. But the definition of property, plant and equipment concerns physical items held for production, the supply of services, rental or administrative purposes (IAS 16, para. 6): software acquired from a publisher is intangible (IAS 38, para. 8). That it is used over several years is not enough to make it tangible. Rule to remember: software is intangible and falls under IAS 38, not IAS 16 (IAS 38, para. 8).","es":""}},{"id":"E","text":{"fr":"","en":"Low-loader trucks used to deliver the rented equipment","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000036","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.MEASUREMENT_TERMS","IAS16.DEFINITIONS.PPE"],"dimension":"APPLICATION","format":"MINI_CASE","context":"LOGISTICS","tested_point":"COST_TO_CARRYING_AMOUNT_CHAIN","difficulty":"ADVANCED","estimated_time_s":300,"lesson_id":"LS.IAS16.000003","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"entries"},"references":["IAS 16 §6","IAS 16 §30","IAS 16 §48","IAS 16 §50","IAS 16 §52","IAS 16 §53"],"exercise":{"prompt":{"fr":"","en":"Follow a fleet of forklift trucks from purchase to carrying amount.","es":""},"explanation":{"fr":"","en":"Steps: (1) Depreciable amount = 64,000 − 4,000 = EUR 60,000; straight-line charge = 60,000 / 5 = EUR 12,000 a year (IAS 16, paras. 50 and 53). (2) Carrying amount at end of N+1 = 64,000 − 2 × 12,000 = EUR 40,000 (IAS 16, para. 30). (3) The year N entry debits the depreciation charge, recognised in profit or loss (IAS 16, para. 48), and credits accumulated depreciation, cost staying unchanged: 12,000 on each side. (4) A rise in fair value does not stop depreciation as long as the residual value stays below the carrying amount (IAS 16, para. 52). Main trap: stopping depreciation because the asset is 'worth more'. Rule to remember: depreciation allocates the depreciable amount over the useful life, regardless of how fair value moves. The notions of depreciable amount and carrying amount are defined by the standard (IAS 16, para. 6).","es":""},"common_error":{"fr":"","en":"Stopping depreciation because the asset's fair value has risen, or posting the depreciation entry directly against the asset's cost.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"A warehousing company buys a fleet of forklift trucks on 1 January N for use in its warehouses. Cost: 64,000. Estimated residual value: 4,000. Useful life: 5 years. Teaching assumption: straight-line method; depreciation tracked in an accumulated account.","es":""},"parts":[{"prompt":{"fr":"","en":"Calculate the annual charge and the carrying amount at the end of N+1.","es":""},"explanation":{"fr":"","en":"Approach: depreciable amount = 64,000 − 4,000 = 60,000; charge = 60,000 / 5 = 12,000 (IAS 16, paras. 50 and 53); carrying amount at the end of N+1 = 64,000 − 2 × 12,000 = 40,000 (IAS 16, para. 30). Trap: forgetting the residual value in the charge calculation (64,000 / 5 = 12,800). Rule to remember: the charge spreads the depreciable amount over the useful life (IAS 16, paras. 50 and 53); the carrying amount is calculated by deducting accumulated depreciation from cost (IAS 16, para. 30).","es":""},"common_error":{"fr":"","en":"Forgetting residual value (64,000 / 5 = 12,800): depreciation spreads the depreciable amount, cost less residual value.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost","es":""},"value":"64000","unit":"EUR"},{"label":{"fr":"","en":"Residual value","es":""},"value":"4000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"5","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Annual charge","es":""},"answer":12000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Carrying amount at the end of N+1","es":""},"answer":40000,"tolerance":0,"unit":"EUR"}],"id":"P1","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Annual charge","es":""},"expression":"(a - b) / c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":64000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Residual value","es":""},"value":4000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Useful life","es":""},"value":5,"unit":"YEARS"}],"result":12000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Carrying amount at the end of N+1","es":""},"expression":"a - 2 * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":64000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Annual charge","es":""},"value":12000,"unit":"EUR"}],"result":40000,"unit":"EUR"}],"rationale":{"fr":"","en":"the charge spreads the depreciable amount over the useful life (IAS 16, paras. 50 and 53); the carrying amount is calculated by deducting accumulated depreciation from cost (IAS 16, para. 30).","es":""},"references":["REF.IAS16.30","REF.IAS16.50","REF.IAS16.53"]}},{"prompt":{"fr":"","en":"Record the depreciation entry for N.","es":""},"explanation":{"fr":"","en":"Approach: the depreciation charge is an expense of the period; the credit goes to accumulated depreciation, without touching cost. The charge is recognised in profit or loss (IAS 16, para. 48); cost remains unchanged (IAS 16, para. 30). Rule to remember: the depreciation entry debits depreciation expense and credits accumulated depreciation, not the cost of the asset (IAS 16, paras. 30 and 48).","es":""},"common_error":{"fr":"","en":"Crediting the asset's cost directly: depreciation is credited to accumulated depreciation, cost remaining unchanged.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"DEPRECIATION_EXPENSE","text":{"fr":"","en":"Depreciation expense","es":""}},{"id":"ACCUMULATED_DEPRECIATION","text":{"fr":"","en":"Accumulated depreciation","es":""}},{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment (cost)","es":""}},{"id":"IMPAIRMENT_LOSS","text":{"fr":"","en":"Impairment loss","es":""}}],"lines":[{"id":"L1","account":"DEPRECIATION_EXPENSE","side":"DEBIT","amount":12000},{"id":"L2","account":"ACCUMULATED_DEPRECIATION","side":"CREDIT","amount":12000}],"id":"P2","dimension":"JOURNAL_ENTRY"},{"prompt":{"fr":"","en":"At the end of N+1, prices of used forklifts have risen sharply: their fair value exceeds 40,000 but residual value is still lower than the carrying amount. The entity may therefore stop depreciating them.","es":""},"explanation":{"fr":"","en":"False. Approach: compare residual value with the carrying amount, not fair value. Depreciation is recognised even if fair value exceeds the carrying amount, as long as residual value does not exceed the carrying amount (IAS 16, para. 52). Trap: stopping depreciation because the asset is \"worth more\". Rule to remember: depreciation continues as long as residual value stays below the carrying amount (IAS 16, para. 52).","es":""},"common_error":{"fr":"","en":"Stopping depreciation because fair value exceeds carrying amount: all that matters is that residual value stays below carrying amount.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P3","dimension":"RULE_KNOWLEDGE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000037","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.CRITERIA"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"MANUFACTURING","tested_point":"RECOGNITION_CRITERIA_CUMULATIVE","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"criteria"},"references":["IAS 16 §7"],"exercise":{"prompt":{"fr":"","en":"Once the cost of a piece of equipment is known precisely from the invoice, that alone is enough to recognise the equipment as an asset.","es":""},"explanation":{"fr":"","en":"False. Steps: (1) the standard sets two recognition criteria (IAS 16, para. 7): it is probable that future economic benefits associated with the item will flow to the entity, and the cost of the item can be measured reliably; (2) the criteria are cumulative, so both must be met; (3) a precise invoice establishes only the second one. Without probable future economic benefits, the item is not recognised as an asset. Main trap: checking only the cost, the easiest criterion to document. Rule to remember: recognition requires both probable future economic benefits and a reliably measured cost (IAS 16, para. 7).","es":""},"common_error":{"fr":"","en":"Keeping only the reliable cost criterion, the easiest one to check.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000038","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.CRITERIA"],"dimension":"DOCUMENTATION","format":"MINI_CASE","context":"ENERGY","tested_point":"RECOGNITION_CRITERIA_WORKPAPER","difficulty":"ADVANCED","estimated_time_s":270,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"judgment"},"references":["IAS 16 §7","IAS 16 §10"],"exercise":{"prompt":{"fr":"","en":"Prepare the \"recognition criteria\" section of the working paper.","es":""},"explanation":{"fr":"","en":"Steps: the working paper must evidence each of the two recognition criteria (IAS 16, para. 7). (1) Probable future economic benefits: the 20-year power purchase agreement and the board-approved operating plan show the entity's intended use; the manufacturer's brochure says nothing about this entity. (2) Cost measured reliably: the signed purchase contract and the invoice give EUR 850,000; the internal email 'about 900,000' is only an estimate. (3) Future expenditure on the transformer is assessed separately when it is incurred (IAS 16, para. 10). Professional judgement: choose entity-specific evidence over general documents. Main trap: believing that the analysis made at purchase exempts later expenditure from analysis. Rule to remember: one piece of evidence per criterion, and a fresh analysis for each later expenditure.","es":""},"common_error":{"fr":"","en":"Documenting cost with an informal estimate rather than the invoice, or assuming that the decision to capitalise applies to all future expenditure.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"An electricity producer acquires an 850,000 transformer to connect a new solar plant, already in operation, to the grid. You must document the recognition of the transformer as an asset.","es":""},"exhibits":[{"title":{"fr":"","en":"Available documents","es":""},"body":{"fr":"","en":"1. Signed purchase contract and supplier invoice. 2. 20-year power purchase agreement with a distributor. 3. Plant operating plan approved by the board. 4. Manufacturer's sales brochure praising its performance. 5. Internal email estimating the transformer at \"about 900,000\".","es":""}}],"parts":[{"prompt":{"fr":"","en":"Which documents provide persuasive evidence that future economic benefits are probable? (Several answers possible.)","es":""},"explanation":{"fr":"","en":"Approach: select the documents that establish the entity's intended use. Probable benefits are assessed against that use: a contract to sell the electricity produced and an approved operating plan (IAS 16, para. 7). Professional judgement: favour entity-specific documents over general ones. Rule to remember: the probable future economic benefits criterion rests on documents relating to the entity's intended use (IAS 16, para. 7).","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"20-year power purchase agreement","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Operating plan approved by the board","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Manufacturer's sales brochure","es":""},"correct":false,"feedback":{"fr":"","en":"A brochure describes the product in general terms: it proves nothing about the benefits this entity will derive from this transformer. Probable benefits are assessed against the entity's intended use, for example a contract to sell the electricity produced and an approved operating plan (IAS 16, para. 7). Rule to remember: the probable future economic benefits criterion is assessed for the entity concerned (IAS 16, para. 7).","es":""}}],"id":"P1","dimension":"DOCUMENTATION"},{"prompt":{"fr":"","en":"Which document supports the criterion of cost measured reliably?","es":""},"explanation":{"fr":"","en":"Approach: look for the documents that fix the exact amount. Cost is reliably measured by the contractual documents: 850,000 (IAS 16, para. 7). Rule to remember: the signed contract and the invoice demonstrate the reliably measured cost criterion (IAS 16, para. 7).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The signed purchase contract and the invoice","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The internal email \"about 900,000\"","es":""},"correct":false,"feedback":{"fr":"","en":"An internal e-mail mentioning \"about 900,000\" is an informal estimate: it does not measure cost reliably, whereas the signed contract and the invoice give the exact amount of 850,000 (IAS 16, para. 7). The reliability criterion for cost rests on contractual documents. Rule to remember: a cost supported by a contract and an invoice is reliably measured; an informal estimate does not demonstrate it (IAS 16, para. 7).","es":""}}],"id":"P2","dimension":"DOCUMENTATION"},{"prompt":{"fr":"","en":"As both criteria are met at purchase, future expenditure on the transformer can be capitalised without further analysis.","es":""},"explanation":{"fr":"","en":"False. Approach: ask whether the criterion is checked once and for all. Each subsequent cost is assessed against the recognition principle when it is incurred (IAS 16, para. 10). Trap: believing that the analysis done at purchase applies to all future expenditure. Rule to remember: each subsequent expenditure is assessed when it is incurred (IAS 16, para. 10).","es":""},"common_error":{"fr":"","en":"Believing the analysis done on purchase covers all future costs: each one is assessed when incurred.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P3","dimension":"RECOGNITION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000039","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.SPARE_PARTS"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"AIRLINE","tested_point":"SPARE_PARTS_PPE_OR_INVENTORY","difficulty":"INTERMEDIATE","estimated_time_s":100,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"spare-parts"},"references":["IAS 16 §6","IAS 16 §8","IAS 2 §6"],"exercise":{"prompt":{"fr":"","en":"Case data: an airline builds up its technical stores. Classify each item.","es":""},"explanation":{"fr":"","en":"Steps: for each item, first check whether it meets the definition of property, plant and equipment, in particular use during more than one period (IAS 16, para. 6). Spare parts, stand-by equipment and servicing equipment follow IAS 16 if they meet that definition, otherwise they are inventories (IAS 16, para. 8). The spare engine, the repairable landing gear and the test bench are used for years: property, plant and equipment. Filters, seals and oil consumed at each check and kits handed to passengers are consumed quickly: inventories (IAS 2, para. 6). Main trap: classifying every part kept in the stores as inventory. Rule to remember: it is the expected period of use, not the place of storage, that determines the category.","es":""},"common_error":{"fr":"","en":"Classifying every part kept in the store as inventory, even a spare engine used for years.","es":""},"format":"CLASSIFICATION","categories":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"INVENTORY","text":{"fr":"","en":"Inventory","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Spare engine kept for several years to replace an engine under overhaul","es":""},"category":"PPE"},{"id":"I2","text":{"fr":"","en":"Repairable landing gear, fitted and refitted across the fleet for years","es":""},"category":"PPE"},{"id":"I3","text":{"fr":"","en":"Filters, seals and hydraulic oil consumed during checks","es":""},"category":"INVENTORY"},{"id":"I4","text":{"fr":"","en":"Engine test bench used by the workshop for 15 years","es":""},"category":"PPE"},{"id":"I5","text":{"fr":"","en":"Blankets and comfort kits handed out to passengers","es":""},"category":"INVENTORY"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000040","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.SPARE_PARTS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"WATER_UTILITY","tested_point":"SPARE_PARTS_PURCHASE_ENTRY","difficulty":"INTERMEDIATE","estimated_time_s":150,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"entries"},"references":["IAS 16 §8","IAS 16 §15","IAS 2 §6"],"exercise":{"prompt":{"fr":"","en":"Case data: a water utility buys, paid by bank, a 35,000 stand-by pump kept in reserve for a pumping station (expected use over several years) and seals and lubricants for 4,200, consumed during interventions. Teaching assumption: VAT ignored. Record the purchase entry.","es":""},"explanation":{"fr":"","en":"Steps: (1) The stand-by pump is kept in reserve and used over several years: it meets the definition of property, plant and equipment and follows IAS 16 (IAS 16, para. 8); it is measured at cost (IAS 16, para. 15): debit property, plant and equipment, EUR 35,000. (2) The seals and lubricants are supplies consumed during interventions: inventories (IAS 2, para. 6), debit EUR 4,200; they will be expensed when consumed. (3) The bank credit is the total paid, 35,000 + 4,200 = EUR 39,200. Main trap: expensing the pump as maintenance because it is a 'spare part'. Rule to remember: a spare part used over more than one period is an asset, a quickly consumed supply is inventory.","es":""},"common_error":{"fr":"","en":"Expensing the stand-by pump as maintenance because it is a \"spare part\".","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"INVENTORY","text":{"fr":"","en":"Inventories of supplies","es":""}},{"id":"MAINTENANCE_EXPENSE","text":{"fr":"","en":"Maintenance expense","es":""}},{"id":"BANK","text":{"fr":"","en":"Bank","es":""}}],"lines":[{"id":"L1","account":"PPE","side":"DEBIT","amount":35000},{"id":"L2","account":"INVENTORY","side":"DEBIT","amount":4200},{"id":"L3","account":"BANK","side":"CREDIT","amount":39200,"given":["account","side"]}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000041","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.UNIT_OF_ACCOUNT"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"FOOD_INDUSTRY","tested_point":"AGGREGATION_OF_INSIGNIFICANT_ITEMS","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"unit-of-account"},"references":["IAS 16 §9"],"exercise":{"prompt":{"fr":"","en":"Case data: a biscuit maker buys 1,200 baking moulds at 45 each (54,000 in total), which it will use for 4 years. Taken one by one, each mould is negligible. Which treatment complies with IAS 16?","es":""},"explanation":{"fr":"","en":"IAS 16 does not prescribe the unit of measure; it may be appropriate to aggregate individually insignificant items, such as moulds, tools and dies, and apply the criteria to the aggregate value (IAS 16, para. 9).","es":""},"common_error":{"fr":"","en":"Expensing a batch of durable moulds on the grounds that each mould, taken alone, is negligible.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Expense everything, since each mould is individually negligible.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer assesses each mould in isolation. But IAS 16 prescribes no unit of measure and allows individually insignificant items, such as moulds, tools and dies, to be aggregated so that the criteria are applied to their aggregate value (IAS 16, para. 9). Case assumption: 1,200 moulds at EUR 45, i.e. EUR 54,000 used for 4 years, form a set assumed to be significant. Rule to remember: aggregation lets the criteria be applied to the aggregate value, not to each item taken alone (IAS 16, para. 9).","es":""}},{"id":"B","text":{"fr":"","en":"Aggregate the moulds and apply the recognition criteria to the whole.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Compulsorily open 1,200 separate asset records.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer turns the possibility of aggregating into an obligation to track every mould. The standard prescribes no unit of measure: the entity applies judgement according to its circumstances (IAS 16, para. 9). Nothing requires one record per mould, and aggregation is precisely allowed to avoid item-by-item tracking. Rule to remember: the unit of account is a matter of judgement, not fixed by the standard.","es":""}},{"id":"D","text":{"fr":"","en":"Recognise them as raw material inventory.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer treats the moulds as raw materials. But the moulds are neither sold nor incorporated into the product: they are used to produce over 4 years, which fits the definition of an item of property, plant and equipment (IAS 16, para. 6). IAS 16 in fact cites moulds expressly among the items that may be aggregated (IAS 16, para. 9). Rule to remember: a tool used to produce over several periods is property, plant and equipment, not a consumed material (IAS 16, para. 6).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000042","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.UNIT_OF_ACCOUNT"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"HOSPITALITY","tested_point":"CAPITALISATION_THRESHOLD_JUDGMENT","difficulty":"EXPERT","estimated_time_s":300,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"judgment"},"references":["IAS 16 §7","IAS 16 §9"],"exercise":{"prompt":{"fr":"","en":"Assess a restaurant chain's unit-of-account policy.","es":""},"explanation":{"fr":"","en":"Steps: (1) IAS 16 sets no EUR 500 per-item threshold: the unit of account is a matter of judgement and the internal threshold is a materiality tool (IAS 16, para. 9). (2) Total furniture: 1,600 × 180 = EUR 288,000; 400 × 450 = EUR 180,000; total EUR 468,000. (3) Individually insignificant items may be aggregated and the criteria applied to the aggregate (IAS 16, para. 9): here, probable benefits over 7 years and reliable cost (IAS 16, para. 7). Professional judgement: group by restaurant or by category and capitalise, since the whole is assumed to be significant (case assumption) and long-lived. Main trap: applying the threshold item by item. Rule to remember: an internal threshold is an entity policy, not an IAS 16 rule; the criteria apply to the aggregated set (IAS 16, para. 9). Professional judgement: it is prudent to document the conclusion and the grouping chosen.","es":""},"common_error":{"fr":"","en":"Mechanically applying a EUR 500 per-item threshold as if it were an IAS 16 rule, without looking at the total amount and period of use of the whole.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"A chain of 40 restaurants applies an internal policy: \"any article below 500 is expensed\". When opening 5 new restaurants, it buys 1,600 chairs at 180 each and 400 tables at 450 each, to be used for about 7 years. The controller proposes to expense everything.","es":""},"parts":[{"prompt":{"fr":"","en":"IAS 16 imposes a capitalisation threshold of 500 per article.","es":""},"explanation":{"fr":"","en":"False. Approach: check whether the standard sets a threshold. IAS 16 does not prescribe the unit of measure (IAS 16, para. 9): a per-item threshold is an internal policy of the entity. Trap: treating an internal threshold as an IAS 16 rule. Rule to remember: IAS 16 sets no per-item capitalisation threshold (IAS 16, para. 9).","es":""},"common_error":{"fr":"","en":"Treating an internal threshold as an IAS 16 rule: the standard does not prescribe the unit of measure.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P1","dimension":"RULE_KNOWLEDGE"},{"prompt":{"fr":"","en":"Calculate the total amount of furniture acquired for the new restaurants.","es":""},"explanation":{"fr":"","en":"Approach: calculate each line, then add up. 1,600 × 180 = 288,000; 400 × 450 = 180,000; total = 468,000. Trap: stopping at the unit price of each item (180 or 450) without looking at the total. Rule to remember: the set acquired is measured by its total amount, EUR 468,000, not item by item (IAS 16, para. 9).","es":""},"common_error":{"fr":"","en":"Stopping at each item's unit price: the whole set acquired is measured by its total amount.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Chairs","es":""},"value":"1600 × 180","unit":"TEXT"},{"label":{"fr":"","en":"Tables","es":""},"value":"400 × 450","unit":"TEXT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Total furniture","es":""},"answer":468000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Total furniture","es":""},"expression":"(a * b) + (c * d)","variables":[{"symbol":"a","meaning":{"fr":"","en":"1,600 chairs","es":""},"value":1600},{"symbol":"b","meaning":{"fr":"","en":"180 each","es":""},"value":180},{"symbol":"c","meaning":{"fr":"","en":"400 tables","es":""},"value":400},{"symbol":"d","meaning":{"fr":"","en":"450 each, to be used for about","es":""},"value":450}],"result":468000,"unit":"EUR","rationale":{"fr":"","en":"Rule to remember: the set acquired is measured by its total amount, EUR 468,000, not item by item (IAS 16, para. 9).","es":""}}],"rationale":{"fr":"","en":"the set acquired is measured by its total amount, EUR 468,000, not item by item (IAS 16, para. 9).","es":""},"references":["REF.IAS16.9"]}},{"prompt":{"fr":"","en":"Which conclusion should be reached?","es":""},"explanation":{"fr":"","en":"Individually insignificant items may be aggregated and the criteria applied to the whole (IAS 16, para. 9); here, probable benefits over 7 years and a reliable cost (IAS 16, para. 7).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Apply the policy: each article is below 500, everything is expensed.","es":""},"correct":false,"feedback":{"fr":"","en":"The policy would lead to expensing 468,000 of durable items. Case assumption: the whole is assumed to be significant and used for about 7 years, so it meets the recognition criteria (IAS 16, para. 7). Applying the threshold item by item loses sight of the whole. Rule to remember: the criteria may be applied to the aggregate of individually insignificant items grouped together (IAS 16, para. 9).","es":""}},{"id":"B","text":{"fr":"","en":"Group the furniture by restaurant or by category and capitalise it, as the whole is significant and used for 7 years.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Capitalise only the tables, whose unit price is closest to the threshold.","es":""},"correct":false,"feedback":{"fr":"","en":"Capitalising only the tables because their unit price is closest to the threshold amounts to using a criterion the standard does not provide: proximity to an internal threshold. Chairs and tables are durable items of the same nature, assessed together (IAS 16, para. 9). Rule to remember: the unit of account is a matter of judgement, not of proximity to an internal threshold (IAS 16, para. 9).","es":""}}],"id":"P3","dimension":"PROFESSIONAL_JUDGMENT"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000043","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.SAFETY_ENVIRONMENTAL"],"dimension":"RECOGNITION","format":"MULTIPLE_CHOICE","context":"SOFTWARE","tested_point":"SAFETY_EQUIPMENT_RECOGNITION_AND_IMPAIRMENT","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"safety-environmental"},"references":["IAS 16 §11","IAS 16 §63"],"exercise":{"prompt":{"fr":"","en":"Case data: a SaaS software publisher installs an automatic gas fire-suppression system in its data centre, required by its insurer and by regulations. The system increases neither computing capacity nor revenue. Which statements are correct? (Several answers possible.)","es":""},"explanation":{"fr":"","en":"Safety equipment that does not directly increase the benefits of an existing asset may be recognised because it is necessary to obtain the benefits of the other assets; the resulting carrying amount is reviewed under IAS 36 (IAS 16, paras. 11 and 63).","es":""},"common_error":{"fr":"","en":"Expensing safety or environmental equipment solely because it increases neither output nor revenue.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The system may be recognised as property, plant and equipment, because it enables the benefits of the servers to be obtained.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The carrying amount of the system and related assets remains subject to the IAS 36 impairment review.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The system can only be capitalised if it generates revenue of its own.","es":""},"correct":false,"feedback":{"fr":"","en":"This statement requires the system to generate revenue of its own. But the benefit of safety equipment is assessed indirectly: it enables the benefits of other assets to be obtained, here the servers and the data centre it protects (IAS 16, para. 11). Case assumption: the system increases neither computing capacity nor revenue, and it is required by the insurer and by regulation. Rule to remember: safety equipment may be capitalised because of the benefits of the assets it relates to, without revenue of its own (IAS 16, para. 11).","es":""}},{"id":"D","text":{"fr":"","en":"Expenditure required by regulations is always a compliance expense.","es":""},"correct":false,"feedback":{"fr":"","en":"This statement turns a regulatory requirement into an automatic expense test. IAS 16 provides the opposite: equipment acquired for safety or environmental reasons may be recognised, because it is necessary to obtain the future economic benefits of other assets (IAS 16, para. 11). The fact that the expenditure is required by regulation or by the insurer does not turn it into a compliance expense. Rule to remember: the regulatory origin of an expenditure does not exempt it from the recognition criteria.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000044","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.CRITERIA","IAS16.RECOGNITION.SPARE_PARTS","IAS16.RECOGNITION.SAFETY_ENVIRONMENTAL"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"CHEMICALS","tested_point":"RECOGNITION_REVIEW_ERRORS","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"pitfalls"},"references":["IAS 16 §7","IAS 16 §8","IAS 16 §10","IAS 16 §11"],"exercise":{"prompt":{"fr":"","en":"Case data: the year-end memo of a chemical site contains the conclusions below. Spot the incorrect ones.","es":""},"explanation":{"fr":"","en":"Steps: for each conclusion, check the nature of the expenditure and the recognition criteria. Safety or environmental equipment may be recognised because it enables the benefits of other assets to be obtained (IAS 16, para. 11). Spare parts and standby equipment that meet the definition are capitalised, whereas supplies used over a short period remain inventory (IAS 16, para. 8). Each subsequent expenditure is assessed against the criteria when it is incurred (IAS 16, para. 10), and each item must meet both criteria: probable future benefits and a reliable cost (IAS 16, para. 7). Trap: validating the memo on the initial purchase alone, or expensing safety equipment because it does not increase output. Rule to remember: every cost, initial or subsequent, is assessed against the recognition criteria when it is incurred (IAS 16, paras. 7 and 10). Effect on the financial statements: wrongly capitalising consumable supplies would inflate assets and reduce expenses.","es":""},"common_error":{"fr":"","en":"Approving a closing note by looking only at the initial purchase, without checking each later expenditure or the period of use of supplies.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The new flue gas treatment unit, required by the operating permit, was expensed because it does not increase output.","es":""},"erroneous":true,"correction":{"fr":"","en":"It is recognised as property, plant and equipment: it enables the benefits of the other site assets to be obtained (IAS 16, para. 11).","es":""}},{"id":"S2","text":{"fr":"","en":"A spare agitator, dedicated to the main reactor and kept for several years, was recognised as property, plant and equipment.","es":""},"erroneous":false},{"id":"S3","text":{"fr":"","en":"Subsequent expenditure on the reactor was capitalised without analysis, since the reactor itself met the criteria originally.","es":""},"erroneous":true,"correction":{"fr":"","en":"Each subsequent expenditure is assessed against the criteria when it is incurred (IAS 16, para. 10).","es":""}},{"id":"S4","text":{"fr":"","en":"Disposable gloves and masks, renewed every week, were recognised as property, plant and equipment as safety equipment.","es":""},"erroneous":true,"correction":{"fr":"","en":"These supplies are not used during more than one period: they are inventory then expense, not property, plant and equipment (IAS 16, para. 8).","es":""}},{"id":"S5","text":{"fr":"","en":"For each asset, the memo demonstrates both probable future benefits and a reliably measured cost.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000045","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.SPARE_PARTS","IAS16.RECOGNITION.UNIT_OF_ACCOUNT","IAS16.RECOGNITION.SAFETY_ENVIRONMENTAL"],"dimension":"CALCULATION","format":"CALCULATION","context":"CHEMICALS","tested_point":"RECOGNITION_ALLOCATION_CALCULATION","difficulty":"ADVANCED","estimated_time_s":210,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"numeric-example"},"references":["IAS 16 §8","IAS 16 §9","IAS 16 §11","IAS 2 §6"],"exercise":{"prompt":{"fr":"","en":"Case data: a paint manufacturer incurs the expenditure below in N. Calculate the amount capitalised, the year-end inventory and the expense of the period.","es":""},"explanation":{"fr":"","en":"Steps: (1) The gas scrubber, required by regulation, is environmental equipment that enables the benefits of other assets to be obtained: EUR 250,000 capitalised (IAS 16, para. 11). (2) The 300 mixing tools at EUR 90, used for 5 years, are individually insignificant but may be aggregated: EUR 27,000 (IAS 16, para. 9). (3) The stand-by compressor, kept for several years, meets the definition of an item of property, plant and equipment: EUR 18,000 (IAS 16, para. 8). Total capitalised: EUR 295,000. (4) The consumables (EUR 9,000) are inventories (IAS 2, para. 6): EUR 6,500 used are expensed, EUR 2,500 remain in inventory. Case assumption: recognition criteria assumed to be met. Trap: excluding the scrubber \"because it earns nothing\". Rule to remember: classification follows the period of use and the function of the item (IAS 16, paras. 8 and 11), not its unit price or profitability.","es":""},"common_error":{"fr":"","en":"Excluding the gas scrubber (\"earns nothing\") or expensing the tools article by article.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Gas scrubber required by regulations","es":""},"value":"250000","unit":"EUR"},{"label":{"fr":"","en":"300 mixing tools at 90, used for 5 years","es":""},"value":"27000","unit":"EUR"},{"label":{"fr":"","en":"Stand-by compressor kept for several years","es":""},"value":"18000","unit":"EUR"},{"label":{"fr":"","en":"Consumables purchased (seals, filters)","es":""},"value":"9000","unit":"EUR"},{"label":{"fr":"","en":"Consumables used during the year","es":""},"value":"6500","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Amount capitalised","es":""},"answer":295000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Consumables inventory at year end","es":""},"answer":2500,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Expense of the period (consumables)","es":""},"answer":6500,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000046","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.CRITERIA"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"CONSTRUCTION","tested_point":"LEASE_RELATED_COSTS_IN_COST","difficulty":"ADVANCED","estimated_time_s":60,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"criteria"},"references":["IAS 16 §10"],"exercise":{"prompt":{"fr":"","en":"Case data: an entity builds its new warehouse itself using a crane that it leases and for which it recognises a right-of-use asset. Depreciation of that right-of-use asset during construction may form part of the costs of the warehouse.","es":""},"explanation":{"fr":"","en":"True. Steps: (1) all costs, initial and subsequent, are assessed against the recognition principle when incurred (IAS 16, para. 10); (2) those costs may include costs related to leases, such as the depreciation of a right-of-use asset used to construct or maintain the item; (3) here, the leased crane is used to build the warehouse: the depreciation of its right-of-use asset during construction can therefore form part of the cost of the warehouse. Main trap: thinking that a cost linked to a leased asset can never enter the cost of an owned asset. Rule to remember: a lease-related cost can be capitalised if it contributes to constructing the asset.","es":""},"common_error":{"fr":"","en":"Thinking that a cost relating to a leased item can never form part of the cost of an owned asset.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000047","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.CRITERIA","IAS16.RECOGNITION.UNIT_OF_ACCOUNT"],"dimension":"APPLICATION","format":"ORDERING","context":"GENERIC","tested_point":"RECOGNITION_ANALYSIS_SEQUENCE","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"how"},"references":["IAS 16 §6","IAS 16 §7","IAS 16 §9","IAS 16 §15"],"exercise":{"prompt":{"fr":"","en":"Put in order the steps for analysing expenditure on a tangible item.","es":""},"explanation":{"fr":"","en":"Steps: (1) First check that the item meets the definition of property, plant and equipment (IAS 16, para. 6). (2) Determine the unit of account, single item or group (IAS 16, para. 9), because the criteria apply to the item or group chosen. (3) Check the two cumulative criteria: probable future economic benefits and reliably measurable cost (IAS 16, para. 7). (4) Recognise the item as an asset, measured at cost (IAS 16, para. 15). Main trap: applying the criteria before fixing the unit. This order is a teaching working approach, not a sequence imposed by the standard. Rule to remember: definition, unit, criteria, then measurement at cost.","es":""},"common_error":{"fr":"","en":"Applying the recognition criteria before fixing the unit of account, when they apply to the item or group chosen.","es":""},"format":"ORDERING","steps":[{"id":"S1","text":{"fr":"","en":"Check that the item meets the definition of property, plant and equipment","es":""}},{"id":"S2","text":{"fr":"","en":"Determine the unit of account (single item or aggregation)","es":""}},{"id":"S3","text":{"fr":"","en":"Check both criteria: probable future economic benefits and cost measurable reliably","es":""}},{"id":"S4","text":{"fr":"","en":"Recognise the item as an asset, measured at its cost","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000048","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.DAY_TO_DAY_SERVICING","IAS16.SUBSEQUENT_COSTS.PART_REPLACEMENT"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"HOSPITALITY","tested_point":"SERVICING_VS_REPLACEMENT","difficulty":"BEGINNER","estimated_time_s":90,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"day-to-day-servicing"},"references":["IAS 16 §12","IAS 16 §13"],"exercise":{"prompt":{"fr":"","en":"Case data: a 200-room hotel incurs the following expenditure on its building and equipment. Classify it.","es":""},"explanation":{"fr":"","en":"Steps: for each expenditure, separate day-to-day servicing from the replacement of a part. Labour, consumables and small parts used in day-to-day servicing are recognised in profit or loss: boiler overhaul, light bulbs, paint touch-ups (IAS 16, para. 12). The complete replacement of the lifts and the full re-roofing concern significant parts: their cost is included in the carrying amount if the criteria are met, and the carrying amount of the parts replaced is derecognised (IAS 16, para. 13). Main trap: capitalising every large expenditure, or expensing a genuine replacement. Rule to remember: day-to-day servicing is expensed, replacing a significant part is capitalised.","es":""},"common_error":{"fr":"","en":"Capitalising every expenditure on a major piece of equipment, when labour, consumables and small parts used in day-to-day servicing are expenses.","es":""},"format":"CLASSIFICATION","categories":[{"id":"EXPENSE","text":{"fr":"","en":"Expense (day-to-day servicing)","es":""}},{"id":"ASSET","text":{"fr":"","en":"Capitalised (replacement of a part)","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Annual boiler service: labour and filters","es":""},"category":"EXPENSE"},{"id":"I2","text":{"fr":"","en":"Complete replacement of lift cars and machinery after 20 years","es":""},"category":"ASSET"},{"id":"I3","text":{"fr":"","en":"Replacement of burnt-out light bulbs","es":""},"category":"EXPENSE"},{"id":"I4","text":{"fr":"","en":"Complete replacement of the roof","es":""},"category":"ASSET"},{"id":"I5","text":{"fr":"","en":"Paint touch-ups in a corridor","es":""},"category":"EXPENSE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000049","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.DAY_TO_DAY_SERVICING"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"TRANSPORT","tested_point":"SERVICING_ENTRY","difficulty":"BEGINNER","estimated_time_s":60,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"day-to-day-servicing"},"references":["IAS 16 §12"],"exercise":{"prompt":{"fr":"","en":"Case data: a haulier receives its garage's invoice for the oil change, greasing and brake pad replacement of its trucks: 3,600, payable in 30 days. Teaching assumption: VAT ignored. Record the entry.","es":""},"explanation":{"fr":"","en":"Steps: (1) The oil change, greasing and brake pad replacement are day-to-day servicing: labour, consumables and small parts (IAS 16, para. 12). (2) They are recognised in profit or loss, not in the carrying amount of the trucks: debit maintenance and repair expenses, EUR 3,600. (3) As the invoice is payable in 30 days and not yet settled, the counterpart is a credit to trade payables of EUR 3,600, not to the bank. Main trap: adding the invoice to the cost of the trucks. Rule to remember: day-to-day servicing goes straight to expenses, without passing through the asset.","es":""},"common_error":{"fr":"","en":"Adding the servicing invoice to the cost of the trucks.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"MAINTENANCE_EXPENSE","text":{"fr":"","en":"Repairs and maintenance expense","es":""}},{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment — vehicles","es":""}},{"id":"PAYABLES","text":{"fr":"","en":"Trade payables","es":""}},{"id":"BANK","text":{"fr":"","en":"Bank","es":""}}],"lines":[{"id":"L1","account":"MAINTENANCE_EXPENSE","side":"DEBIT","amount":3600},{"id":"L2","account":"PAYABLES","side":"CREDIT","amount":3600}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000050","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.PART_REPLACEMENT"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"REAL_ESTATE","tested_point":"DERECOGNITION_EVEN_IF_NOT_SEPARATELY_DEPRECIATED","difficulty":"INTERMEDIATE","estimated_time_s":45,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"part-replacement"},"references":["IAS 16 §13","IAS 16 §70"],"exercise":{"prompt":{"fr":"","en":"When a part of an item is replaced and the new cost is capitalised, the carrying amount of the old part is only derecognised if that part was depreciated separately.","es":""},"explanation":{"fr":"","en":"False. Steps: (1) when the cost of a replacement is included in the carrying amount, the carrying amount of the part replaced is derecognised (IAS 16, paras. 13 and 70); (2) this applies whether or not the part had been depreciated separately; (3) if its carrying amount cannot be determined in practice, the cost of the replacement may be used as an indication of what the part's cost was when acquired or constructed. Main trap: leaving the old part in the overall carrying amount for lack of separate tracking, which counts the same part twice. Rule to remember: every part replaced is derecognised, whether tracked separately or not.","es":""},"common_error":{"fr":"","en":"Leaving the old part in the overall carrying amount for lack of separate tracking.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000051","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.PART_REPLACEMENT"],"dimension":"CALCULATION","format":"CALCULATION","context":"TRANSPORT","tested_point":"REPLACED_PART_CARRYING_AMOUNT_ESTIMATE","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"replacement-calculation"},"references":["IAS 16 §13","IAS 16 §70","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Case data: a coach operator replaces a coach's engine after 4 years. The coach (cost 300,000, life 10 years, nil residual value, straight-line) was never split into components: the carrying amount of the original engine is unknown. Teaching assumption: the cost of the new engine (45,000) is used as an indication of the original cost, without price adjustment, and the old engine is depreciated like the coach. The old engine is scrapped with no proceeds. Calculate.","es":""},"explanation":{"fr":"","en":"Steps: (1) The carrying amount of the original engine is unknown: the cost of the new engine (EUR 45,000) is used as an indication of its original cost (IAS 16, para. 70), under the stated pedagogical assumption. (2) It is depreciated like the coach: 45,000 × 4/10 = EUR 18,000; estimated carrying amount = 45,000 − 18,000 = EUR 27,000. (3) Scrapped with no proceeds, it is derecognised with a loss of EUR 27,000 (nil proceeds less carrying amount), in profit or loss (IAS 16, para. 71). (4) The coach before replacement stands at 300,000 − 4 × 30,000 = EUR 180,000; afterwards, 180,000 − 27,000 + 45,000 = EUR 198,000 (IAS 16, para. 13). Main trap: adding the EUR 45,000 without derecognising the old engine, i.e. EUR 225,000, which counts two engines. Rule to remember: replacing means removing the old part and recognising the new one.","es":""},"common_error":{"fr":"","en":"Adding the 45,000 to the coach without removing anything (carrying amount of 225,000), which counts two engines.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost of the coach","es":""},"value":"300000","unit":"EUR"},{"label":{"fr":"","en":"Useful life of the coach","es":""},"value":"10","unit":"YEARS"},{"label":{"fr":"","en":"Years elapsed","es":""},"value":"4","unit":"YEARS"},{"label":{"fr":"","en":"Cost of the new engine","es":""},"value":"45000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Estimated carrying amount of the old engine","es":""},"answer":27000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Loss on derecognition","es":""},"answer":27000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Carrying amount of the coach after replacement","es":""},"answer":198000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Estimated carrying amount of the old engine","es":""},"expression":"a - (a * b / c)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the new engine","es":""},"value":45000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Years elapsed","es":""},"value":4,"unit":"YEARS"},{"symbol":"c","meaning":{"fr":"","en":"Useful life of the coach","es":""},"value":10,"unit":"YEARS"}],"result":27000,"unit":"EUR"}],"rationale":{"fr":"","en":"replacing means removing the old part and recognising the new one.","es":""},"references":["REF.IAS16.13","REF.IAS16.70","REF.IAS16.71"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000052","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.PART_REPLACEMENT"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"RETAIL","tested_point":"REPLACEMENT_ENTRY_WITH_SCRAP_PROCEEDS","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"replacement-entry"},"references":["IAS 16 §13","IAS 16 §68","IAS 16 §70","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Case data: a shopping centre replaces the drive units of its escalators, tracked as a component. New drive units: 80,000, paid by bank. Old drive units: cost 60,000, accumulated depreciation 45,000; they are sold for 3,000 cash to a scrap dealer. Record the full entry.","es":""},"explanation":{"fr":"","en":"Steps: (1) The cost of the new drive system is included in the carrying amount: debit property, plant and equipment (new) EUR 80,000, credit bank (IAS 16, para. 13). (2) The old drive system is derecognised: carrying amount = 60,000 − 45,000 = EUR 15,000 (IAS 16, para. 70). Cost is cleared (credit 60,000) along with accumulated depreciation (debit 45,000). (3) The EUR 3,000 sale proceeds are received (debit bank). (4) Gain or loss = net proceeds 3,000 − carrying amount 15,000 = −12,000: a loss of EUR 12,000 in profit or loss (IAS 16, paras. 68 and 71), not in revenue. Check: debits 80,000 + 45,000 + 3,000 + 12,000 = 140,000 = credits 80,000 + 60,000. Main trap: crediting revenue and forgetting to derecognise the old component. Rule to remember: on replacement, recognise the new component and remove the old one; the difference with the proceeds is a gain or loss in profit or loss.","es":""},"common_error":{"fr":"","en":"Crediting revenue with 3,000 and forgetting to remove the old component.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE_NEW","text":{"fr":"","en":"Property, plant and equipment — drive units (new)","es":""}},{"id":"PPE_OLD","text":{"fr":"","en":"Property, plant and equipment — drive units (old)","es":""}},{"id":"ACCUMULATED_DEPRECIATION","text":{"fr":"","en":"Accumulated depreciation — drive units (old)","es":""}},{"id":"LOSS_ON_DERECOGNITION","text":{"fr":"","en":"Loss on derecognition (profit or loss)","es":""}},{"id":"REVENUE","text":{"fr":"","en":"Revenue","es":""}},{"id":"BANK","text":{"fr":"","en":"Bank","es":""}}],"lines":[{"id":"L1","account":"PPE_NEW","side":"DEBIT","amount":80000},{"id":"L2","account":"BANK","side":"CREDIT","amount":80000},{"id":"L3","account":"ACCUMULATED_DEPRECIATION","side":"DEBIT","amount":45000},{"id":"L4","account":"BANK","side":"DEBIT","amount":3000},{"id":"L5","account":"LOSS_ON_DERECOGNITION","side":"DEBIT","amount":12000},{"id":"L6","account":"PPE_OLD","side":"CREDIT","amount":60000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000053","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.MAJOR_INSPECTIONS"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"SHIPPING","tested_point":"MAJOR_INSPECTION_TREATMENT","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"major-inspections"},"references":["IAS 16 §14"],"exercise":{"prompt":{"fr":"","en":"Case data: a ferry must be dry-docked every 5 years for a class survey, without which it can no longer sail. This year, the survey costs 1,100,000; no major part is replaced. Which treatment?","es":""},"explanation":{"fr":"","en":"When a major inspection is performed, its cost is recognised in the carrying amount as a replacement if the criteria are met, and the remaining carrying amount of the previous inspection is derecognised (IAS 16, para. 14).","es":""},"common_error":{"fr":"","en":"Expensing the periodic major inspection because no part is replaced, or provisioning it in advance instead of capitalising it as a component when it is carried out.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Expense of the period, since no part is replaced.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer makes capitalisation depend on a part being replaced. But when a major inspection is performed, its cost is recognised in the carrying amount as a replacement if the criteria are met, whether or not parts are changed (IAS 16, para. 14). The class survey is a condition for the ferry to keep sailing: it provides benefits until the next one. Rule to remember: a major inspection is treated like a replacement, even when no part is changed.","es":""}},{"id":"B","text":{"fr":"","en":"Capitalised as a component if the criteria are met; derecognition of what remains of the previous survey.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Added to the ship's cost, depreciated over the ferry's remaining life (25 years).","es":""},"correct":false,"feedback":{"fr":"","en":"This answer adds the survey to the ship's cost and depreciates it over 25 years. But the survey provides its benefits until the next survey, i.e. 5 years: spreading it over the ferry's remaining life does not reflect its consumption. It is treated as a separate component, recognised like a replacement, with derecognition of the remaining carrying amount of the previous survey (IAS 16, para. 14). Rule to remember: the 'survey' component is depreciated over the interval between two surveys.","es":""}},{"id":"D","text":{"fr":"","en":"Recognition of a 1,100,000 provision from the acquisition of the ferry.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer sets up a EUR 1,100,000 provision at acquisition of the ferry. But IAS 16 treats the major inspection as a component of the asset when it is carried out, not as an advance provision (IAS 16, para. 14). Before the survey, there is no obligation: nothing to provide for. Rule to remember: a major inspection is capitalised when carried out; it is not provided for in advance.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000054","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.MAJOR_INSPECTIONS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"AIRLINE","tested_point":"MAJOR_INSPECTION_ENTRY","difficulty":"EXPERT","estimated_time_s":270,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"inspection-calculation"},"references":["IAS 16 §14","IAS 16 §68","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Case data: an airline performs the heavy check of an aircraft for 520,000, paid by bank. The previous check component is carried at a cost of 450,000 with accumulated depreciation of 300,000: the new check comes earlier than planned. Record the entry.","es":""},"explanation":{"fr":"","en":"Steps: (1) The cost of the new major inspection is recognised in the carrying amount as a replacement: debit inspection component (new) EUR 520,000, credit bank (IAS 16, para. 14). (2) The remaining carrying amount of the previous inspection is derecognised: 450,000 − 300,000 = EUR 150,000; cost is cleared (credit 450,000) together with accumulated depreciation (debit 300,000). (3) With no disposal proceeds, the derecognition loss is EUR 150,000, in profit or loss (IAS 16, paras. 68 and 71). Check: debits 520,000 + 300,000 + 150,000 = 970,000 = credits 520,000 + 450,000. Professional judgement: since the inspection came early, the remaining amount is no longer depreciated over the time left; it is removed. Main trap: expensing the inspection as maintenance, or leaving the EUR 150,000 remainder on the balance sheet. Rule to remember: a new major inspection is capitalised, and the remainder of the previous one goes to profit or loss.","es":""},"common_error":{"fr":"","en":"Expensing the new check as maintenance, or capitalising it while leaving the 150,000 remainder in the balance sheet.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"INSPECTION_NEW","text":{"fr":"","en":"Property, plant and equipment — check component (new)","es":""}},{"id":"INSPECTION_OLD","text":{"fr":"","en":"Property, plant and equipment — check component (previous)","es":""}},{"id":"ACCUMULATED_DEPRECIATION","text":{"fr":"","en":"Accumulated depreciation — check component (previous)","es":""}},{"id":"LOSS_ON_DERECOGNITION","text":{"fr":"","en":"Loss on derecognition (profit or loss)","es":""}},{"id":"MAINTENANCE_EXPENSE","text":{"fr":"","en":"Maintenance expense","es":""}},{"id":"BANK","text":{"fr":"","en":"Bank","es":""}}],"lines":[{"id":"L1","account":"INSPECTION_NEW","side":"DEBIT","amount":520000},{"id":"L2","account":"BANK","side":"CREDIT","amount":520000},{"id":"L3","account":"ACCUMULATED_DEPRECIATION","side":"DEBIT","amount":300000},{"id":"L4","account":"LOSS_ON_DERECOGNITION","side":"DEBIT","amount":150000},{"id":"L5","account":"INSPECTION_OLD","side":"CREDIT","amount":450000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000055","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.MAJOR_INSPECTIONS"],"dimension":"CALCULATION","format":"CALCULATION","context":"ENERGY","tested_point":"MAJOR_INSPECTION_DEPRECIATION_AND_EARLY_RENEWAL","difficulty":"ADVANCED","estimated_time_s":210,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"inspection-calculation"},"references":["IAS 16 §14","IAS 16 §43","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Case data: a power station capitalises the overhaul of its turbine (360,000), due every 4 years, as a component depreciated over that interval. Teaching assumptions: straight-line method, nil residual value. After 3 years, a new overhaul is carried out early for 400,000; the next one is due 4 years later. Calculate.","es":""},"explanation":{"fr":"","en":"Steps: (1) The previous overhaul is depreciated over its expected interval: 360,000 / 4 = EUR 90,000 a year, following the component approach (IAS 16, para. 43). (2) After 3 years, the carrying amount is 360,000 − 3 × 90,000 = EUR 90,000. As the new overhaul takes place early, this carrying amount is derecognised, with a loss of EUR 90,000 in profit or loss, as there are no proceeds (IAS 16, paras. 14 and 71). (3) The new EUR 400,000 overhaul is capitalised and depreciated over 4 years: 400,000 / 4 = EUR 100,000 a year. The 4-year period is the entity's estimate. Main trap: continuing to depreciate the old overhaul to its theoretical end. Rule to remember: the remainder of the previous overhaul is removed as soon as the new one is capitalised.","es":""},"common_error":{"fr":"","en":"Continuing to depreciate the old overhaul to its theoretical end instead of removing its remainder as soon as the new overhaul is capitalised.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost of the previous overhaul","es":""},"value":"360000","unit":"EUR"},{"label":{"fr":"","en":"Planned interval","es":""},"value":"4","unit":"YEARS"},{"label":{"fr":"","en":"Years elapsed","es":""},"value":"3","unit":"YEARS"},{"label":{"fr":"","en":"Cost of the new overhaul","es":""},"value":"400000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Annual depreciation of the previous overhaul","es":""},"answer":90000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Carrying amount derecognised (loss)","es":""},"answer":90000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Annual depreciation of the new overhaul","es":""},"answer":100000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Annual depreciation of the previous overhaul","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the previous overhaul","es":""},"value":360000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Planned interval","es":""},"value":4,"unit":"YEARS"}],"result":90000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Carrying amount derecognised (loss)","es":""},"expression":"a - b * c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the previous overhaul","es":""},"value":360000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Years elapsed","es":""},"value":3,"unit":"YEARS"},{"symbol":"c","meaning":{"fr":"","en":"Annual depreciation of the previous overhaul","es":""},"value":90000,"unit":"EUR"}],"result":90000,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Annual depreciation of the new overhaul","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the new overhaul","es":""},"value":400000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Planned interval","es":""},"value":4,"unit":"YEARS"}],"result":100000,"unit":"EUR"}],"rationale":{"fr":"","en":"the remainder of the previous overhaul is removed as soon as the new one is capitalised.","es":""},"references":["REF.IAS16.14","REF.IAS16.43","REF.IAS16.71"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000056","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.DAY_TO_DAY_SERVICING","IAS16.SUBSEQUENT_COSTS.PART_REPLACEMENT","IAS16.SUBSEQUENT_COSTS.MAJOR_INSPECTIONS"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"MANUFACTURING","tested_point":"SUBSEQUENT_COSTS_REVIEW_ERRORS","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"pitfalls"},"references":["IAS 16 §12","IAS 16 §13","IAS 16 §14","IAS 16 §52","IAS 16 §68"],"exercise":{"prompt":{"fr":"","en":"Case data: you are reviewing a cement works' year-end entries relating to its rotary kiln. Spot the incorrect treatments.","es":""},"explanation":{"fr":"","en":"Steps: for each treatment, identify whether it concerns day-to-day servicing, replacement of a part, a major inspection or the presentation of the disposal result. Day-to-day servicing is expensed, even when its amount is high (IAS 16, para. 12); the new lining is capitalised and the carrying amount of the old one is derecognised (IAS 16, para. 13); maintenance does not remove the need to depreciate (IAS 16, para. 52); the remaining carrying amount of the previous inspection is derecognised (IAS 16, para. 14); the gain or loss on disposal is not classified as revenue (IAS 16, para. 68). Trap: deciding on the amount of the expenditure rather than its nature. Rule to remember: the nature of the expenditure decides its treatment (IAS 16, paras. 12 to 14). Effect on the financial statements: capitalising day-to-day servicing would inflate assets and profit for the period.","es":""},"common_error":{"fr":"","en":"Relying on the size of an expenditure to decide to capitalise it, or ceasing to depreciate a well-maintained asset.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The labour and lubricants invoice for monthly servicing (64,000 for the year) was capitalised because of its large amount.","es":""},"erroneous":true,"correction":{"fr":"","en":"It is the nature of the expenditure that matters: day-to-day servicing is expensed (IAS 16, para. 12).","es":""}},{"id":"S2","text":{"fr":"","en":"The new refractory lining of the kiln was capitalised and the carrying amount of the old lining was derecognised.","es":""},"erroneous":false},{"id":"S3","text":{"fr":"","en":"As the kiln was very well maintained this year, no depreciation charge was recognised.","es":""},"erroneous":true,"correction":{"fr":"","en":"Repairs and maintenance do not remove the need to depreciate (IAS 16, para. 52).","es":""}},{"id":"S4","text":{"fr":"","en":"The kiln's regulatory major inspection was capitalised, but the remainder of the previous inspection was left in the balance sheet.","es":""},"erroneous":true,"correction":{"fr":"","en":"The remaining carrying amount of the previous inspection must be derecognised (IAS 16, para. 14).","es":""}},{"id":"S5","text":{"fr":"","en":"The proceeds from selling the old lining to a recycler were presented as revenue.","es":""},"erroneous":true,"correction":{"fr":"","en":"The gain or loss on derecognition is recognised in profit or loss but is not classified as revenue (IAS 16, para. 68).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000057","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.DAY_TO_DAY_SERVICING","IAS16.SUBSEQUENT_COSTS.PART_REPLACEMENT","IAS16.SUBSEQUENT_COSTS.MAJOR_INSPECTIONS"],"dimension":"RECOGNITION","format":"MATCHING","context":"RAIL","tested_point":"SUBSEQUENT_COST_TREATMENTS","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"understand"},"references":["IAS 16 §12","IAS 16 §13","IAS 16 §14"],"exercise":{"prompt":{"fr":"","en":"Case data: a rail operator incurs expenditure on its trainsets. Match each expenditure with its treatment.","es":""},"explanation":{"fr":"","en":"Steps: for each expenditure, ask whether it is day-to-day servicing, the replacement of a part or a major inspection. Cleaning and top-ups after each run: day-to-day servicing, expensed (IAS 16, para. 12). Replacement of all seats: the new cost is capitalised if the criteria are met and the old part is derecognised (IAS 16, para. 13). Compulsory general overhaul, a condition for continued operation: major inspection, capitalised like a replacement with derecognition of the remainder of the previous one (IAS 16, para. 14). A major inspection is treated like a replacement (IAS 16, para. 14), not as a provision to be set up: R4 is matched to no expenditure. Main trap: provisioning the overhaul in advance. Rule to remember: expense for day-to-day servicing, capitalise for replacement and major inspection.","es":""},"common_error":{"fr":"","en":"Provisioning in advance for the compulsory general overhaul, instead of capitalising it as a component when it is carried out.","es":""},"format":"MATCHING","left":[{"id":"L1","text":{"fr":"","en":"Cleaning and fluid top-ups after each rotation","es":""}},{"id":"L2","text":{"fr":"","en":"Replacement of all passenger seats after 10 years","es":""}},{"id":"L3","text":{"fr":"","en":"Mandatory general overhaul every 8 years, a condition for continued operation","es":""}}],"right":[{"id":"R1","text":{"fr":"","en":"Expense of the period","es":""}},{"id":"R2","text":{"fr":"","en":"Capitalise the new part and derecognise the old one","es":""}},{"id":"R3","text":{"fr":"","en":"Capitalise as a component and derecognise the remainder of the previous overhaul","es":""}},{"id":"R4","text":{"fr":"","en":"Recognise a provision for major maintenance","es":""}}],"pairs":[{"left":"L1","right":"R1"},{"left":"L2","right":"R2"},{"left":"L3","right":"R3"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000058","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.DAY_TO_DAY_SERVICING","IAS16.SUBSEQUENT_COSTS.PART_REPLACEMENT"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"TELECOM","tested_point":"SUBSEQUENT_COSTS_CASE","difficulty":"EXPERT","estimated_time_s":330,"lesson_id":"LS.IAS16.000005","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"judgment"},"references":["IAS 16 §12","IAS 16 §13","IAS 16 §68","IAS 16 §70","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Analyse the expenditure incurred on a data centre and quantify its effect.","es":""},"explanation":{"fr":"","en":"Steps: (1) The preventive maintenance contract (visits, filters, fluids) is day-to-day servicing, expensed: EUR 18,000 (IAS 16, para. 12). (2) The full replacement of the system is capitalised if the criteria are met: EUR 310,000 (IAS 16, para. 13). (3) The old system is derecognised: annual depreciation 240,000 / 12 = 20,000; accumulated over 9 years 180,000; carrying amount EUR 60,000 (IAS 16, para. 70). (4) Disposal result = proceeds 6,000 − carrying amount 60,000 = a loss of EUR 54,000, in profit or loss (IAS 16, para. 71); the recycler's payment is not revenue (IAS 16, para. 68). Professional judgement: the loss is not carried into the cost of the new system. Main trap: adding the loss back into the new component. Rule to remember: servicing is expensed, a replacement is capitalised, the old part is removed with a gain or loss in profit or loss.","es":""},"common_error":{"fr":"","en":"Carrying the disposal loss on the old plant into the cost of the new system, or capitalising the preventive maintenance contract.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"A telecom operator runs a data centre. In N, it incurs three items of expenditure on its cooling installation, tracked as a component (original cost 240,000, depreciated over 12 years on a straight-line basis, nil residual value, brought into use 9 years ago).","es":""},"exhibits":[{"title":{"fr":"","en":"Expenditure in N","es":""},"body":{"fr":"","en":"1. Preventive maintenance contract (visits, filters, fluids): 18,000. 2. Complete replacement of the cooling installation with a more efficient system, usable for 12 years: 310,000. 3. The old installation is taken back by a recycler for 6,000.","es":""}}],"parts":[{"prompt":{"fr":"","en":"How should the 18,000 preventive maintenance contract be treated?","es":""},"explanation":{"fr":"","en":"Approach: identify the nature of the expenditure. A preventive maintenance contract (visits, filters, fluids) is day-to-day servicing, recognised in profit or loss (IAS 16, para. 12). Rule to remember: day-to-day servicing is an expense of the period (IAS 16, para. 12).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Expense of the period","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Added to the cost of the new installation","es":""},"correct":false,"feedback":{"fr":"","en":"Visits, filters and fluids are day-to-day servicing: they are recognised in profit or loss and are not part of the cost of the new system (IAS 16, para. 12). Adding them to the cost of the new installation would inflate the asset by 18,000 and reduce the period's expenses by the same amount. Rule to remember: day-to-day servicing is recognised in profit or loss, not in the carrying amount of an asset (IAS 16, para. 12).","es":""}}],"id":"P1","dimension":"RECOGNITION"},{"prompt":{"fr":"","en":"Calculate the carrying amount of the old installation and the result of its derecognition.","es":""},"explanation":{"fr":"","en":"Approach: annual depreciation 240,000 / 12 = 20,000; accumulated over 9 years 180,000; carrying amount 60,000 (IAS 16, para. 70). Loss = 6,000 − 60,000 = −54,000, in profit or loss (IAS 16, para. 71). Trap: measuring the loss against the original cost of 240,000. Rule to remember: when a replaced part is derecognised, its carrying amount is removed (IAS 16, para. 70) and the result on disposal goes to profit or loss (IAS 16, para. 71).","es":""},"common_error":{"fr":"","en":"Computing the loss on original cost (240,000): the carrying amount of the replaced part is derecognised.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Original cost","es":""},"value":"240000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"12","unit":"YEARS"},{"label":{"fr":"","en":"Years elapsed","es":""},"value":"9","unit":"YEARS"},{"label":{"fr":"","en":"Take-back proceeds","es":""},"value":"6000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Carrying amount of the old installation","es":""},"answer":60000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Loss on derecognition","es":""},"answer":54000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION"},{"prompt":{"fr":"","en":"Which conclusions are correct? (Several answers possible.)","es":""},"explanation":{"fr":"","en":"Approach: deal separately with the replacement, the derecognition of the old installation and the presentation of the trade-in proceeds. The replacement is capitalised if the criteria are met (IAS 16, para. 13); derecognising the old installation produces a loss in profit or loss (IAS 16, para. 71), and disposal proceeds are not classified as revenue (IAS 16, para. 68). Rule to remember: replacement capitalised, old part derecognised with a gain or loss in profit or loss, outside revenue (IAS 16, paras. 13, 68 and 71).","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The new system (310,000) is capitalised if the recognition criteria are met.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The 6,000 take-back proceeds are not presented as revenue.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The 54,000 loss may be added to the cost of the new system, since it results from the replacement.","es":""},"correct":false,"feedback":{"fr":"","en":"The carrying amount of the old part is derecognised: the loss of 54,000 is recognised in profit or loss (IAS 16, paras. 70 and 71) and is not carried over to the new component, whose cost is that of the replacement (IAS 16, para. 13). Adding it to cost would inflate the asset by 54,000. Rule to remember: the loss on disposal goes to profit or loss, it is not added to the cost of the replacement (IAS 16, paras. 13, 70 and 71).","es":""}}],"id":"P3","dimension":"PROFESSIONAL_JUDGMENT"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000059","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DECOMMISSIONING"],"dimension":"CALCULATION","format":"CALCULATION","context":"ENERGY","tested_point":"DECOMMISSIONING_PRESENT_VALUE","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"decommissioning-calculation"},"references":["IAS 16 §16","IAS 16 §18"],"exercise":{"prompt":{"fr":"","en":"Case data: on 1 January N a power producer installs solar panels on land it will have to restore in 5 years (obligation arising from installation). Calculate the amount included in cost, then the effect of the passage of time on the provision in N (rounded to the euro). Teaching assumption: the provision is the present value of the expenditure, at the rate provided.","es":""},"explanation":{"fr":"","en":"Steps: (1) The initial estimate of site restoration costs is included in the cost of the asset (IAS 16, para. 16), the provision being measured under IAS 37 (IAS 16, para. 18). Under the pedagogical assumption, it equals the present value: 80,000 ÷ 1.216653 = EUR 65,754 added to the cost of the panels. (2) Passage of time in N: 65,754 × 4% = EUR 2,630 increase in the provision. (3) Provision at 31 December N: 65,754 + 2,630 = EUR 68,384. These EUR 2,630 do not change the cost of the panels; their treatment is covered in chapter 06. Main trap: adding 80,000 to cost without discounting, or adding the 2,630 for N to cost. Rule to remember: the initial estimate of dismantling costs is part of cost (IAS 16, para. 16); the effect of time is dealt with separately.","es":""},"common_error":{"fr":"","en":"Adding 80,000 to cost without discounting, or adding the 2,630 of N to the cost of the panels.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Estimated restoration expenditure in 5 years","es":""},"value":"80000","unit":"EUR"},{"label":{"fr":"","en":"Discount rate provided","es":""},"value":"4","unit":"PERCENT"},{"label":{"fr":"","en":"Factor 1.04^5","es":""},"value":"1.216653","unit":"TEXT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Amount added to the cost of the panels","es":""},"answer":65754,"tolerance":2,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Increase in the provision due to the passage of time in N","es":""},"answer":2630,"tolerance":2,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Provision at 31 December N","es":""},"answer":68384,"tolerance":3,"unit":"EUR"}],"formula":{"lines":[{"step":"S2","meaning":{"fr":"","en":"Increase in the provision due to the passage of time in N","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Amount added to the cost of the panels","es":""},"value":65754,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Discount rate provided","es":""},"value":4,"unit":"PERCENT"}],"result":2630,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Provision at 31 December N","es":""},"expression":"a + b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Amount added to the cost of the panels","es":""},"value":65754,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Increase in the provision due to the passage of time in N","es":""},"value":2630,"unit":"EUR"}],"result":68384,"unit":"EUR"}],"rationale":{"fr":"","en":"the initial estimate of dismantling costs is part of cost (IAS 16, para. 16); the effect of time is dealt with separately.","es":""},"references":["REF.IAS16.16","REF.IAS16.18"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000060","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DECOMMISSIONING"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"TELECOM","tested_point":"DECOMMISSIONING_INITIAL_ENTRY","difficulty":"INTERMEDIATE","estimated_time_s":150,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"decommissioning-entry"},"references":["IAS 16 §16","IAS 16 §18"],"exercise":{"prompt":{"fr":"","en":"Case data: a telecoms operator installs a mast for 2,000,000, paid by bank transfer. The land lease requires it, from installation, to dismantle the mast in 8 years; the provision measured under IAS 37 amounts to 94,729 (120,000 discounted at 3%). Record the commissioning entry.","es":""},"explanation":{"fr":"","en":"Steps: (1) The cost of the mast includes the initial estimate of dismantling costs (IAS 16, para. 16): 2,000,000 paid + 94,729 provision = EUR 2,094,729, debited to property, plant and equipment. (2) The bank credit is EUR 2,000,000. (3) The obligation arising from the installation gives rise to a provision measured under IAS 37 (IAS 16, para. 18), credited for EUR 94,729. Debits 2,094,729 = credits 2,000,000 + 94,729. No expense is recognised on commissioning. Main trap: debiting a EUR 94,729 dismantling expense instead of including it in cost. Rule to remember: the dismantling provision arising from installation increases the asset's cost; it does not go to expenses.","es":""},"common_error":{"fr":"","en":"Debiting a dismantling expense of 94,729 instead of including it in the cost of the mast.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"BANK","text":{"fr":"","en":"Bank","es":""}},{"id":"DECOMMISSIONING_PROVISION","text":{"fr":"","en":"Decommissioning provision","es":""}},{"id":"DISMANTLING_EXPENSE","text":{"fr":"","en":"Dismantling expense","es":""}},{"id":"FINANCE_COSTS","text":{"fr":"","en":"Finance costs","es":""}}],"lines":[{"id":"L1","account":"PPE","side":"DEBIT","amount":2094729},{"id":"L2","account":"BANK","side":"CREDIT","amount":2000000,"given":["account","side","amount"]},{"id":"L3","account":"DECOMMISSIONING_PROVISION","side":"CREDIT","amount":94729}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000061","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DECOMMISSIONING"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"MINING","tested_point":"DECOMMISSIONING_ORIGIN","difficulty":"ADVANCED","estimated_time_s":120,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"decommissioning-rule"},"references":["IAS 16 §16","IAS 16 §18"],"exercise":{"prompt":{"fr":"","en":"A company operates an aggregates quarry. Classify each restoration obligation according to where its cost is recognised.","es":""},"explanation":{"fr":"","en":"Steps: for each obligation, ask when it arose. (1) Dismantling the crusher and its slab, required as soon as they were installed, and removing the conveyor built when the site opened: obligations arising from installing the asset, hence included in its cost (IAS 16, para. 16). (2) Backfilling the year's pits and re-vegetating the surfaces stripped during the period: obligations incurred during the period as a consequence of using the asset to produce inventories, falling under IAS 2 (IAS 16, para. 18). In both cases, the provision is measured under IAS 37. Main trap: capitalising everything because it is always 'site restoration'. Rule to remember: the origin of the obligation, installation or production of the period, determines where the cost is recognised.","es":""},"common_error":{"fr":"","en":"Capitalising everything in the item because it is always \"site restoration\".","es":""},"format":"CLASSIFICATION","categories":[{"id":"PPE_COST","text":{"fr":"","en":"Cost of the item (IAS 16)","es":""}},{"id":"INVENTORY_COST","text":{"fr":"","en":"Cost of inventories produced (IAS 2)","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Removal of the crusher and its slab, required from installation","es":""},"category":"PPE_COST"},{"id":"I2","text":{"fr":"","en":"Backfilling the pits dug by extracting this year's aggregates","es":""},"category":"INVENTORY_COST"},{"id":"I3","text":{"fr":"","en":"Removal of the conveyor belt built when the site opened","es":""},"category":"PPE_COST"},{"id":"I4","text":{"fr":"","en":"Replanting the surfaces stripped as production progressed during the period","es":""},"category":"INVENTORY_COST"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000062","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DECOMMISSIONING"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"ENERGY","tested_point":"DECOMMISSIONING_WORKPAPER_REVIEW","difficulty":"EXPERT","estimated_time_s":180,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"judgment"},"references":["IAS 16 §16","IAS 16 §18","IAS 16 §50"],"exercise":{"prompt":{"fr":"","en":"You are reviewing a colleague's working note on dismantling a wind turbine (obligation arising from installation, estimated expenditure 300,000 in 20 years, case rate provided). Spot the erroneous statements.","es":""},"explanation":{"fr":"","en":"Steps: separate what falls under IAS 37 (existence and amount of the provision) from what falls under IAS 16 (inclusion in cost and depreciation). The initial estimate of dismantling costs is part of the cost of the wind turbine from installation (IAS 16, para. 16); IAS 37 determines the obligation and its amount (IAS 16, para. 18); the total cost, dismantling component included, is then depreciated over the useful life (IAS 16, para. 50). The amount included in cost is the provision measured at installation (rate supplied by the case), not the gross future expenditure of 300,000. Trap: waiting for the dismantling invoice before recognising anything, or not depreciating the component because it will be paid at the end. Rule to remember: the initial estimate of dismantling enters cost from installation and is depreciated with it (IAS 16, paras. 16 and 50). Effect on the financial statements: the asset and the provision are recognised from installation, and each year's charge includes the dismantling component.","es":""},"common_error":{"fr":"","en":"Waiting for the dismantling invoice before recognising anything, or not depreciating the dismantling component because it will only be paid at the end.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"Whether the provision exists and its amount are determined under IAS 37.","es":""},"erroneous":false},{"id":"S2","text":{"fr":"","en":"Since no invoice has been received, nothing is recognised before dismantling.","es":""},"erroneous":true,"correction":{"fr":"","en":"The initial estimate of dismantling is part of cost from installation (IAS 16, para. 16).","es":""}},{"id":"S3","text":{"fr":"","en":"The amount included in cost is the provision measured at installation, not the gross future expenditure of 300,000.","es":""},"erroneous":false},{"id":"S4","text":{"fr":"","en":"The dismantling component is not depreciated, since it will only be paid at the end.","es":""},"erroneous":true,"correction":{"fr":"","en":"It is part of the cost of the turbine and is depreciated with it: the depreciable amount is allocated over the useful life (IAS 16, paras. 16 and 50).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000064","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PROCEEDS_BEFORE_INTENDED_USE"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"AUTOMOTIVE","tested_point":"PROCEEDS_ENTRY","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"proceeds-entry"},"references":["IAS 16 §20A","IAS 16 §74A"],"exercise":{"prompt":{"fr":"","en":"Case data: during the trials of a stamping line, an automotive subcontractor sells compliant parts on credit for 30,000. Those parts, recorded in inventories, have a cost of 21,000 measured under IAS 2. Record the sale entries (assumption: a separate income line is used).","es":""},"explanation":{"fr":"","en":"Steps: (1) The credit sale of parts produced during testing gives rise to a receivable: debit trade receivables EUR 30,000, against a separate income line of EUR 30,000, recognised in profit or loss (IAS 16, para. 20A). (2) The cost of the parts, measured under IAS 2, is removed from inventories: debit cost of items sold, credit inventories, EUR 21,000, in profit or loss (IAS 16, para. 20A). (3) The asset account is not touched. Each entry balances. If these amounts are not presented separately, they are disclosed in the notes with the line items concerned (IAS 16, para. 74A). Main trap: crediting the asset EUR 30,000, which would wrongly reduce the cost of the asset. Rule to remember: proceeds and cost of items produced while getting the asset ready go to profit or loss, without touching the asset's cost (IAS 16, para. 20A). Effect on the financial statements: profit or loss includes income of 30,000 and a cost of 21,000, and the cost of the line is unchanged.","es":""},"common_error":{"fr":"","en":"Crediting PPE with 30,000, which would wrongly reduce the cost of the asset.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"RECEIVABLES","text":{"fr":"","en":"Trade receivables","es":""}},{"id":"INCOME_PRE_USE","text":{"fr":"","en":"Income — sales of items produced before intended use","es":""}},{"id":"COST_OF_ITEMS_SOLD","text":{"fr":"","en":"Cost of items sold","es":""}},{"id":"INVENTORIES","text":{"fr":"","en":"Inventories","es":""}},{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}}],"lines":[{"id":"L1","account":"RECEIVABLES","side":"DEBIT","amount":30000},{"id":"L2","account":"INCOME_PRE_USE","side":"CREDIT","amount":30000},{"id":"L3","account":"COST_OF_ITEMS_SOLD","side":"DEBIT","amount":21000},{"id":"L4","account":"INVENTORIES","side":"CREDIT","amount":21000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000065","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PROCEEDS_BEFORE_INTENDED_USE"],"dimension":"CALCULATION","format":"CALCULATION","context":"ENERGY","tested_point":"PROCEEDS_COST_UNCHANGED","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"proceeds-entry"},"references":["IAS 16 §16","IAS 16 §17","IAS 16 §20A"],"exercise":{"prompt":{"fr":"","en":"Case data: a company installs a biomass boiler. During trials, the electricity produced is sold to the grid. Calculate the cost of the boiler and the net effect of those sales on profit or loss.","es":""},"explanation":{"fr":"","en":"Steps: (1) Cost of the boiler: net purchase price 900,000 + installation 60,000 + technical performance tests 35,000 = EUR 995,000, since the tests are directly attributable costs (IAS 16, paras. 16 and 17). (2) The electricity sales during testing (EUR 22,000) and their cost under IAS 2 (EUR 16,000) are recognised separately in profit or loss: net effect of + EUR 6,000 (IAS 16, para. 20A). (3) These sales do not reduce the cost of the boiler. Main trap: using 973,000 (deducting the sales) or 989,000 (deducting the net margin). Rule to remember: sales during testing go to profit or loss, and the asset's cost stays the sum of its costs of getting ready.","es":""},"common_error":{"fr":"","en":"Using 973,000 (sales deducted) or 989,000 (net margin deducted).","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Net purchase price","es":""},"value":"900000","unit":"EUR"},{"label":{"fr":"","en":"Installation","es":""},"value":"60000","unit":"EUR"},{"label":{"fr":"","en":"Technical performance tests","es":""},"value":"35000","unit":"EUR"},{"label":{"fr":"","en":"Electricity sales during trials","es":""},"value":"22000","unit":"EUR"},{"label":{"fr":"","en":"Cost of that electricity under IAS 2 (fuel)","es":""},"value":"16000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Cost of the boiler","es":""},"answer":995000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Net effect of the sales on profit or loss (proceeds − cost)","es":""},"answer":6000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Cost of the boiler","es":""},"expression":"a + b + c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Net purchase price","es":""},"value":900000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Installation","es":""},"value":60000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Technical performance tests","es":""},"value":35000,"unit":"EUR"}],"result":995000,"unit":"EUR"}],"rationale":{"fr":"","en":"sales during testing go to profit or loss, and the asset's cost stays the sum of its costs of getting ready.","es":""},"references":["REF.IAS16.16","REF.IAS16.17","REF.IAS16.20A"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000066","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.INCIDENTAL_OPERATIONS"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"RETAIL","tested_point":"INCIDENTAL_VS_NECESSARY","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"incidental-rule"},"references":["IAS 16 §17","IAS 16 §21"],"exercise":{"prompt":{"fr":"","en":"A retailer is building a hypermarket. Classify each item.","es":""},"explanation":{"fr":"","en":"Steps: for each item, ask whether it is necessary to bring the hypermarket to the location and condition required. Earthworks and levelling (site preparation) and testing of the refrigeration systems (testing of proper functioning) are: they are costs of the asset (IAS 16, para. 17). Renting the hoarding to an advertiser and the temporary car park run before works began are incidental operations, not necessary to get the asset ready: their income and expenses go to profit or loss (IAS 16, para. 21). Main trap: deducting from cost the revenue received during construction. Rule to remember: what is not necessary to get the asset ready does not touch the asset's cost, neither up nor down.","es":""},"common_error":{"fr":"","en":"Deducting from cost the income received during construction.","es":""},"format":"CLASSIFICATION","categories":[{"id":"ASSET_COST","text":{"fr":"","en":"Cost of the hypermarket","es":""}},{"id":"PROFIT_OR_LOSS","text":{"fr":"","en":"Profit or loss (incidental operation)","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Earthworks and levelling of the plot","es":""},"category":"ASSET_COST"},{"id":"I2","text":{"fr":"","en":"Income from renting the hoarding to a billboard company during the works","es":""},"category":"PROFIT_OR_LOSS"},{"id":"I3","text":{"fr":"","en":"Testing the refrigeration installations before opening","es":""},"category":"ASSET_COST"},{"id":"I4","text":{"fr":"","en":"Takings and costs of a temporary car park run on the plot before work started","es":""},"category":"PROFIT_OR_LOSS"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000067","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.INCIDENTAL_OPERATIONS","IAS16.INITIAL_COST.PROCEEDS_BEFORE_INTENDED_USE"],"dimension":"ANALYSIS","format":"MINI_CASE","context":"HOSPITALITY","tested_point":"INCIDENTAL_OPERATIONS_CASE","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"incidental-rule"},"references":["IAS 16 §20A","IAS 16 §21"],"exercise":{"prompt":{"fr":"","en":"Analyse the file and answer the questions.","es":""},"explanation":{"fr":"","en":"Steps: (1) The paid car park run while waiting for the permit is not necessary to build the hotel: it is an incidental operation, whose income (18,000) and expenses (5,000) go to profit or loss (IAS 16, para. 21). (2) The bread made during the bakery tests consists of items produced while getting the asset ready: income of 4,000 and cost of 3,000 under IAS 2 go to profit or loss (IAS 16, para. 20A). (3) The cost of the hotel is therefore not reduced (EUR 0); the net effect on profit or loss is (18,000 − 5,000) + (4,000 − 3,000) = EUR 14,000. Two different bases, the same consequence. Main trap: following the accountant who deducts EUR 22,000 from cost. Rule to remember: neither incidental operations nor sales of items produced during testing reduce the cost of the asset.","es":""},"common_error":{"fr":"","en":"Reducing the cost of the asset by the revenue received during construction, whether it comes from an incidental activity or from selling items produced during testing.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"A hotel group bought a city-centre plot to build a hotel. While waiting for the building permit (8 months), it runs it as a paid car park: takings 18,000, security 5,000. Once the hotel is completed, the built-in industrial bakery is tested; the bread produced during those tests is sold to a neighbouring restaurant for 4,000 (cost under IAS 2: 3,000). The accountant suggests reducing the cost of the hotel by 18,000 + 4,000.","es":""},"parts":[{"prompt":{"fr":"","en":"How should the car park be characterised?","es":""},"explanation":{"fr":"","en":"Approach: ask whether the activity is necessary to bring the hotel to the condition required. The car park is an incidental operation: 18,000 of income, 5,000 of expenses (IAS 16, para. 21). Rule to remember: the income and expenses of an incidental operation are recognised in profit or loss (IAS 16, para. 21).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"An incidental operation: income and expenses in profit or loss","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"An activity needed to make the hotel ready","es":""},"correct":false,"feedback":{"fr":"","en":"The hotel could be built without this car park: operating the car park is not necessary to bring the hotel to the location and condition required (IAS 16, para. 21). It is therefore an incidental operation, not an activity of getting the asset ready. Rule to remember: an operation not necessary for getting the asset ready is recognised in profit or loss (IAS 16, para. 21).","es":""}},{"id":"C","text":{"fr":"","en":"An item produced while the hotel is being made ready","es":""},"correct":false,"feedback":{"fr":"","en":"Paragraph 20A concerns items produced by the asset while it is being made ready, such as the loaves from the bakery tests. The car park is a separate activity, run while waiting for the permit, which falls under paragraph 21 (IAS 16, paras. 20A and 21). Rule to remember: items produced while the asset is being made ready (para. 20A) must be distinguished from incidental operations (para. 21).","es":""}}],"id":"P1","dimension":"RECOGNITION"},{"prompt":{"fr":"","en":"Amount by which the cost of the hotel must be reduced, and total effect of both situations on profit or loss.","es":""},"explanation":{"fr":"","en":"Approach: deal with the car park and the loaves separately. No reduction of cost: car park in profit or loss (IAS 16, para. 21), loaves from the tests in profit or loss (IAS 16, para. 20A). Effect: (18,000 − 5,000) + (4,000 − 3,000) = 14,000. Trap: reducing the cost of the hotel by 22,000. Rule to remember: the car park (para. 21) and the loaves from the tests (para. 20A) go to profit or loss, without reducing the cost of the hotel.","es":""},"common_error":{"fr":"","en":"Reducing the hotel's cost by the car park and bread proceeds: both go to profit or loss.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Car park: takings / costs","es":""},"value":"18000 / 5000","unit":"TEXT"},{"label":{"fr":"","en":"Test bread: proceeds / IAS 2 cost","es":""},"value":"4000 / 3000","unit":"TEXT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Reduction in the cost of the hotel","es":""},"answer":0,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Total net effect on profit or loss","es":""},"answer":14000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000068","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.SELF_CONSTRUCTED"],"dimension":"CALCULATION","format":"CALCULATION","context":"LOGISTICS","tested_point":"SELF_CONSTRUCTED_COST","difficulty":"INTERMEDIATE","estimated_time_s":150,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"self-constructed-calculation"},"references":["IAS 16 §19","IAS 16 §22"],"exercise":{"prompt":{"fr":"","en":"Case data: a logistics company builds a sorting platform itself. Calculate the cost to be capitalised and the total of the amounts excluded (no interest is involved here).","es":""},"explanation":{"fr":"","en":"Steps: a self-constructed asset follows the same principles as an acquired asset; internal profits are eliminated and abnormal costs excluded (IAS 16, para. 22). (1) Cost to capitalise: materials 250,000 + direct labour 90,000 + design office fees 18,000 = EUR 358,000. (2) Excluded: wiring redone after an assembly error (abnormal cost) 12,000, internal margin of the works department 35,000 (IAS 16, para. 22), and share of head office overheads 20,000 (general overheads, IAS 16, para. 19): total EUR 67,000. Check: 358,000 + 67,000 = 425,000. Main trap: capitalising the full internal price of EUR 425,000, margin and rework included. Rule to remember: capitalise real cost, excluding internal margin, abnormal costs and general overheads.","es":""},"common_error":{"fr":"","en":"Capitalising the full internal price (425,000), margin and rework included.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Materials used","es":""},"value":"250000","unit":"EUR"},{"label":{"fr":"","en":"Direct site labour","es":""},"value":"90000","unit":"EUR"},{"label":{"fr":"","en":"Fees of the external engineering firm","es":""},"value":"18000","unit":"EUR"},{"label":{"fr":"","en":"Wiring redone after an assembly error","es":""},"value":"12000","unit":"EUR"},{"label":{"fr":"","en":"Internal margin of the works department","es":""},"value":"35000","unit":"EUR"},{"label":{"fr":"","en":"Share of general management costs","es":""},"value":"20000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Cost of the platform","es":""},"answer":358000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Total excluded (expenses or eliminated margin)","es":""},"answer":67000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000069","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.SELF_CONSTRUCTED"],"dimension":"RULE_KNOWLEDGE","format":"SINGLE_CHOICE","context":"ENERGY","tested_point":"SELF_CONSTRUCTED_BORROWING_COSTS","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"self-constructed-rule"},"references":["IAS 16 §18","IAS 16 §22","IAS 16 §23"],"exercise":{"prompt":{"fr":"","en":"A company builds a power plant itself and finances the work with a bank loan. Which standard determines the treatment of the interest on that loan?","es":""},"explanation":{"fr":"","en":"Steps: (1) The power plant is a self-constructed asset, with the construction financed by a bank loan. (2) IAS 16 treats such an asset on the same principles as an acquired one, and refers to IAS 23 for borrowing costs (IAS 16, para. 22). (3) The same reference to IAS 23 exists for interest on deferred payment (IAS 16, para. 23). IAS 37 deals with provisions, such as the dismantling provision (IAS 16, para. 18), and IAS 2 with inventories. Main trap: mixing up borrowing costs, provisions and inventories. Rule to remember: for interest on a self-constructed asset, IAS 23 determines the treatment.","es":""},"common_error":{"fr":"","en":"Applying IAS 37 or IAS 2 to the interest on a debt-financed construction project, because borrowing costs, provisions and inventories are confused.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"IAS 23","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"IAS 37","es":""},"correct":false,"feedback":{"fr":"","en":"This answer picks IAS 37 because the project suggests future obligations. But IAS 37 deals with provisions, such as the dismantling provision (IAS 16, para. 18), not with interest on a loan: for a self-constructed asset, IAS 16 refers to IAS 23 for borrowing costs (IAS 16, para. 22). Example: interest on a loan taken out for the project falls under IAS 23, while site restoration falls under IAS 37. Rule to remember: loan interest, IAS 23; provisions, IAS 37.","es":""}},{"id":"C","text":{"fr":"","en":"IAS 2","es":""},"correct":false,"feedback":{"fr":"","en":"This answer picks IAS 2 because the company is 'making' the plant. But IAS 2 covers inventories, i.e. goods held for sale or consumption; a power plant the entity builds to operate is an item of property, plant and equipment, and for its borrowing costs IAS 16 refers to IAS 23 (IAS 16, para. 22). Example: a plant built for sale would be inventory, whereas this one is operated by the entity. Rule to remember: building the asset yourself does not change the standard that applies to interest: IAS 23.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000070","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.SELF_CONSTRUCTED"],"dimension":"DOCUMENTATION","format":"ORDERING","context":"MANUFACTURING","tested_point":"SELF_CONSTRUCTED_WORKPAPER","difficulty":"EXPERT","estimated_time_s":120,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"judgment"},"references":["IAS 16 §19","IAS 16 §20","IAS 16 §22"],"exercise":{"prompt":{"fr":"","en":"You are documenting the cost of a workshop built by the entity. Put the steps in a logical working order.","es":""},"explanation":{"fr":"","en":"Steps: start from the source documents, then remove what should not enter cost. (1) Gather the internal job costing and the external invoices. (2) Set aside the internal margin of the works department: internal profits are eliminated (IAS 16, para. 22). (3) Isolate abnormal costs (waste, rework), which are excluded (IAS 16, para. 22), and general overheads, which are excluded (IAS 16, para. 19), to expense them. (4) Stop capitalising at the date the workshop is ready to operate (IAS 16, para. 20). (5) Analyse borrowing costs separately under IAS 23 (IAS 16, para. 22). This order is a pedagogical working method, not a sequence imposed by the standard. Main trap: stopping capitalisation at commercial opening. Rule to remember: actual cost from the documents, less margin, anomalies and overheads, bounded by the date the asset is ready.","es":""},"common_error":{"fr":"","en":"Including in the cost of a self-constructed asset the internal margin and rework for errors, or stopping capitalisation at commercial opening rather than when the asset is ready.","es":""},"format":"ORDERING","steps":[{"id":"S1","text":{"fr":"","en":"Gather the internal site statement and external invoices","es":""}},{"id":"S2","text":{"fr":"","en":"Remove the internal margin invoiced by the works department","es":""}},{"id":"S3","text":{"fr":"","en":"Isolate abnormal costs (scrap, rework) and general overheads, to be expensed","es":""}},{"id":"S4","text":{"fr":"","en":"Stop capitalising at the date the workshop is ready to operate","es":""}},{"id":"S5","text":{"fr":"","en":"Analyse borrowing interest separately under IAS 23","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000071","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.SELF_CONSTRUCTED"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"CONSTRUCTION","tested_point":"INTERNAL_PROFIT_ELIMINATED","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000006","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"self-constructed-rule"},"references":["IAS 16 §22"],"exercise":{"prompt":{"fr":"","en":"A construction company building its own head office may record it at the price it would have charged a customer, margin included.","es":""},"explanation":{"fr":"","en":"False. Steps: (1) a self-constructed asset follows the same principles as an acquired asset (IAS 16, para. 22); (2) it is therefore measured at its construction cost, not at a selling price; (3) internal profits are eliminated: an entity does not earn a margin on itself. The head office built by the construction company is therefore not recorded at the price it would have charged a customer. Main trap: confusing the usual selling price with the cost of construction. Rule to remember: a self-constructed asset is recorded at its cost, excluding internal margin.","es":""},"common_error":{"fr":"","en":"Confusing the company's usual selling price with the cost of construction.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000072","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DEFERRED_PAYMENT"],"dimension":"CALCULATION","format":"CALCULATION","context":"AGRICULTURE","tested_point":"CASH_PRICE_EQUIVALENT","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"deferred-payment-calculation"},"references":["IAS 16 §23"],"exercise":{"prompt":{"fr":"","en":"Case data: on 1 January N an agricultural cooperative receives a combine harvester payable 600,000 in one sum in 3 years, whereas usual credit in the industry is 90 days. Financing rate provided: 5%. Teaching assumption: interest calculated at a constant rate on the outstanding debt. Round to the euro.","es":""},"explanation":{"fr":"","en":"Steps: (1) Payment is deferred beyond normal credit terms (3 years instead of 90 days): cost is the cash price equivalent (IAS 16, para. 23). (2) Discount the payment at the rate given: 600,000 ÷ 1.157625 = EUR 518,303, the cost of the combine harvester. (3) Interest for N: 518,303 × 5% = EUR 25,915, on the outstanding debt. (4) Total interest: 600,000 − 518,303 = EUR 81,697, recognised over the credit period, unless capitalised under IAS 23 (IAS 16, para. 23). Main trap: capitalising EUR 600,000, or computing interest for N on 600,000 (30,000). Rule to remember: cost is the cash price equivalent; the difference from the price paid is interest spread over the credit period.","es":""},"common_error":{"fr":"","en":"Capitalising 600,000, or calculating N interest on 600,000 (30,000).","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Single payment in 3 years","es":""},"value":"600000","unit":"EUR"},{"label":{"fr":"","en":"Case rate","es":""},"value":"5","unit":"PERCENT"},{"label":{"fr":"","en":"Factor 1.05^3","es":""},"value":"1.157625","unit":"TEXT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Cost of the harvester (cash price equivalent)","es":""},"answer":518303,"tolerance":2,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Interest expense for N","es":""},"answer":25915,"tolerance":2,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Total interest over the 3 years","es":""},"answer":81697,"tolerance":2,"unit":"EUR"}],"formula":{"lines":[{"step":"S2","meaning":{"fr":"","en":"Interest expense for N","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the harvester (cash price equivalent)","es":""},"value":518303,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Case rate","es":""},"value":5,"unit":"PERCENT"}],"result":25915,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Total interest over the 3 years","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Single payment in 3 years","es":""},"value":600000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Cost of the harvester (cash price equivalent)","es":""},"value":518303,"unit":"EUR"}],"result":81697,"unit":"EUR"}],"rationale":{"fr":"","en":"cost is the cash price equivalent; the difference from the price paid is interest spread over the credit period.","es":""},"references":["REF.IAS16.23"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000073","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DEFERRED_PAYMENT"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"HEALTHCARE","tested_point":"DEFERRED_PAYMENT_ENTRY","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"deferred-payment-entry"},"references":["IAS 16 §23"],"exercise":{"prompt":{"fr":"","en":"Case data: a clinic receives a scanner priced at 400,000: 100,000 paid in cash on delivery, 300,000 payable in 2 years (beyond normal credit). Case rate: 5%; present value of the 300,000: 272,109. Record the receipt entry.","es":""},"explanation":{"fr":"","en":"Steps: (1) Part of the price is payable in 2 years, beyond normal credit terms: cost is the cash price equivalent (IAS 16, para. 23). (2) Cash price equivalent = 100,000 paid in cash + 272,109 (present value of the 300,000 at 5%) = EUR 372,109, debited to property, plant and equipment. (3) Bank is credited EUR 100,000 and the payable to the asset supplier EUR 272,109, its present value. (4) The EUR 27,891 difference (300,000 − 272,109) will be recognised as interest over the 2 years, unless capitalised under IAS 23 (IAS 16, para. 23); no interest expense is recognised on delivery. Debits 372,109 = credits 100,000 + 272,109. Main trap: debiting EUR 400,000, or immediately expensing EUR 27,891 as interest. Rule to remember: the asset and the payable are recorded at present value, and interest then accrues over the credit period.","es":""},"common_error":{"fr":"","en":"Debiting PPE with 400,000 or expensing 27,891 of interest straight away.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"BANK","text":{"fr":"","en":"Bank","es":""}},{"id":"FIXED_ASSET_PAYABLES","text":{"fr":"","en":"Payables for fixed assets","es":""}},{"id":"INTEREST_EXPENSE","text":{"fr":"","en":"Interest expense","es":""}}],"lines":[{"id":"L1","account":"PPE","side":"DEBIT","amount":372109},{"id":"L2","account":"BANK","side":"CREDIT","amount":100000,"given":["account","side"]},{"id":"L3","account":"FIXED_ASSET_PAYABLES","side":"CREDIT","amount":272109}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000074","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DEFERRED_PAYMENT"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"RETAIL","tested_point":"NORMAL_CREDIT_TERMS","difficulty":"INTERMEDIATE","estimated_time_s":45,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"deferred-payment-rule"},"references":["IAS 16 §23"],"exercise":{"prompt":{"fr":"","en":"A retailer buys shelving payable at 45 days, the usual term of its suppliers. It must separate and discount an interest component.","es":""},"explanation":{"fr":"","en":"False. Steps: (1) the cash price equivalent rule applies to payment deferred beyond normal credit terms (IAS 16, para. 23); (2) a 45-day term is the usual term of the retailer's suppliers: we remain within normal terms; (3) cost is therefore the agreed price, with no interest component to isolate or discount. Main trap: discounting any payment that is not immediate, whatever the term. Rule to remember: discounting applies only to credit that goes beyond normal terms.","es":""},"common_error":{"fr":"","en":"Discounting every payment that is not immediate, whatever the period.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000075","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DEFERRED_PAYMENT"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"AUTOMOTIVE","tested_point":"DEFERRED_PAYMENT_REVIEW","difficulty":"EXPERT","estimated_time_s":150,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"deferred-payment-entry"},"references":["IAS 16 §23"],"exercise":{"prompt":{"fr":"","en":"File review: a press is payable 1,000,000 in 2 years (unusually long credit); cash equivalent stated by the seller: 890,000. Spot the erroneous statements.","es":""},"explanation":{"fr":"","en":"Steps: payment exceeds normal credit terms, so start from the cash price equivalent. Cost is the cash price equivalent (890,000); the difference of 110,000 is recognised as interest over the period of credit, unless capitalised under IAS 23 (IAS 16, para. 23). The depreciable amount is calculated from cost, not from the total paid, and the payable grows each year by accrued interest up to 1,000,000. Trap: calculating depreciation on 1,000,000 or expensing the 110,000 on delivery. Rule to remember: where payment is deferred beyond normal credit terms, cost is the cash price equivalent and the difference is recognised as interest over the period of credit (IAS 16, para. 23). Effect on the financial statements: the asset and the depreciation charge rest on 890,000, and interest expense is spread over the two years of credit.","es":""},"common_error":{"fr":"","en":"Computing depreciation on the total paid (1,000,000) or expensing the financing difference on delivery.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The press is recognised at 890,000.","es":""},"erroneous":false},{"id":"S2","text":{"fr":"","en":"The 110,000 difference is recognised as finance cost on delivery.","es":""},"erroneous":true,"correction":{"fr":"","en":"They are recognised as interest over the credit period, unless capitalised under IAS 23 (IAS 16, para. 23).","es":""}},{"id":"S3","text":{"fr":"","en":"Depreciation is calculated on 1,000,000.","es":""},"erroneous":true,"correction":{"fr":"","en":"It is calculated on cost, i.e. the cash equivalent of 890,000 (IAS 16, para. 23).","es":""}},{"id":"S4","text":{"fr":"","en":"The supplier debt increases each year by the accrued interest until it reaches 1,000,000.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000076","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.ASSET_EXCHANGE"],"dimension":"ANALYSIS","format":"MINI_CASE","context":"AGRICULTURE","tested_point":"EXCHANGE_COMMERCIAL_SUBSTANCE_CASE","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"exchange-how"},"references":["IAS 16 §24","IAS 16 §25","IAS 16 §26","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Analyse the file and answer.","es":""},"explanation":{"fr":"","en":"Steps: (1) Commercial substance: after-tax cash flows change in timing and amount, in a documented and significant way relative to the fair value of the assets exchanged (IAS 16, para. 25); the absence of cash or the similar nature of the assets is not the test. (2) With commercial substance and a reliable fair value, the tractor is measured at the fair value of the machine given up: EUR 95,000 (IAS 16, paras. 24 and 26). (3) The machine given up is derecognised at its carrying amount of 180,000 − 110,000 = EUR 70,000: gain of 95,000 − 70,000 = EUR 25,000 in profit or loss (IAS 16, para. 71). Professional judgement: the assessment of commercial substance rests on the cash flows expected in the business plan. Main trap: concluding there is no substance because 'nothing is paid'. Rule to remember: in an exchange with commercial substance, the asset received is measured at the fair value of the asset given up and the difference from its carrying amount is a gain or loss.","es":""},"common_error":{"fr":"","en":"Concluding there is no commercial substance because no cash changes hands or because both assets are agricultural equipment.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"A wine estate gives up its old grape harvester (cost 180,000, accumulated depreciation 110,000) to a dealer and receives a straddle tractor in exchange. No cash is paid. The fair value of the harvester given up, based on recent sales of identical models, is 95,000. The estate stops harvesting mechanically itself and subcontracts it, and uses the tractor to maintain the vines: according to its business plan, its after-tax cash flows change markedly in timing and amount, to an extent that is significant relative to the fair value of the assets exchanged.","es":""},"parts":[{"prompt":{"fr":"","en":"Does the exchange have commercial substance?","es":""},"explanation":{"fr":"","en":"Commercial substance: future after-tax cash flows change in a documented way that is significant relative to the fair value of the assets exchanged (IAS 16, para. 25).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Yes: the profile of the expected future cash flows changes significantly relative to the fair value of the assets exchanged","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"No: no cash is exchanged","es":""},"correct":false,"feedback":{"fr":"","en":"The absence of cash is not the criterion: commercial substance is assessed on the change in future cash flows or in entity-specific value (IAS 16, para. 25). Here, after-tax cash flows change markedly in timing and amount, to a degree that is significant relative to the fair value of the assets exchanged. Rule to remember: commercial substance is judged on cash flows or entity-specific value, not on whether a payment is made (IAS 16, para. 25).","es":""}},{"id":"C","text":{"fr":"","en":"No: both assets are farm equipment","es":""},"correct":false,"feedback":{"fr":"","en":"Similarity of nature is not enough: what matters is the change in expected cash flows or in entity-specific value, and its significance relative to the fair value of the assets exchanged (IAS 16, para. 25). Here, the business gives up mechanical harvesting and uses the tractor differently: the cash flows change. Rule to remember: the nature of the assets exchanged is not the criterion for commercial substance (IAS 16, para. 25).","es":""}}],"id":"P1","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"Calculate the cost of the tractor and the gain or loss on the harvester.","es":""},"explanation":{"fr":"","en":"Approach: with commercial substance and a reliable fair value, cost is the fair value of the asset given up; the gain is measured against its carrying amount. Cost = 95,000 (IAS 16, paras. 24 and 26). Gain: 95,000 − 70,000 = 25,000 in profit or loss (IAS 16, para. 71). Trap: using the original cost of 180,000 instead of the carrying amount of 70,000. Rule to remember: the asset received is measured at the fair value of the asset given up, and the difference from the latter's carrying amount is a gain or loss (IAS 16, paras. 24, 26 and 71).","es":""},"common_error":{"fr":"","en":"Measuring the gain against the machine's original cost: it is computed on its carrying amount (70,000).","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Carrying amount of the harvester given up","es":""},"value":"70000","unit":"EUR"},{"label":{"fr":"","en":"Fair value of the harvester given up","es":""},"value":"95000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Cost of the tractor","es":""},"answer":95000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Gain on disposal (positive)","es":""},"answer":25000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION","formula":{"lines":[{"step":"S2","meaning":{"fr":"","en":"Gain on disposal (positive)","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Fair value of the harvester given up","es":""},"value":95000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Carrying amount of the harvester given up","es":""},"value":70000,"unit":"EUR"}],"result":25000,"unit":"EUR"}],"rationale":{"fr":"","en":"the asset received is measured at the fair value of the asset given up, and the difference from the latter's carrying amount is a gain or loss (IAS 16, paras. 24, 26 and 71).","es":""},"references":["REF.IAS16.24","REF.IAS16.26","REF.IAS16.71"]}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000077","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.ASSET_EXCHANGE"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"MANUFACTURING","tested_point":"EXCHANGE_ENTRY_WITH_LOSS","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"exchange-example"},"references":["IAS 16 §24","IAS 16 §67","IAS 16 §68","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Case data: a manufacturer exchanges a milling machine (cost 300,000, accumulated depreciation 180,000) for an industrial 3D printer. The exchange has commercial substance; reliable fair value of the milling machine: 100,000. No cash. Record the entry.","es":""},"explanation":{"fr":"","en":"Steps: (1) The exchange has commercial substance and the fair value of the milling machine is reliable: the 3D printer is measured at that fair value, EUR 100,000 (IAS 16, para. 24). (2) The milling machine is derecognised (IAS 16, para. 67): its cost is cleared (credit 300,000) and its accumulated depreciation (debit 180,000), giving a carrying amount of EUR 120,000. (3) Loss = fair value 100,000 − carrying amount 120,000 = − EUR 20,000, in profit or loss (IAS 16, paras. 68 and 71). Check: debits 100,000 + 180,000 + 20,000 = 300,000 = credit 300,000. Main trap: recording the printer at 120,000 to avoid the loss. Rule to remember: with commercial substance, the asset received is measured at the fair value of the asset given up and the gain or loss goes to profit or loss.","es":""},"common_error":{"fr":"","en":"Recording the printer at 120,000 to avoid the loss, although the exchange has commercial substance.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE_NEW","text":{"fr":"","en":"Property, plant and equipment — 3D printer","es":""}},{"id":"PPE_OLD","text":{"fr":"","en":"Property, plant and equipment — milling machine","es":""}},{"id":"ACC_DEP","text":{"fr":"","en":"Accumulated depreciation — milling machine","es":""}},{"id":"LOSS_DISPOSAL","text":{"fr":"","en":"Loss on disposal of PPE","es":""}},{"id":"GAIN_DISPOSAL","text":{"fr":"","en":"Gain on disposal of PPE","es":""}}],"lines":[{"id":"L1","account":"PPE_NEW","side":"DEBIT","amount":100000},{"id":"L2","account":"ACC_DEP","side":"DEBIT","amount":180000},{"id":"L3","account":"LOSS_DISPOSAL","side":"DEBIT","amount":20000},{"id":"L4","account":"PPE_OLD","side":"CREDIT","amount":300000,"given":["account","side","amount"]}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000078","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.ASSET_EXCHANGE"],"dimension":"CALCULATION","format":"CALCULATION","context":"LOGISTICS","tested_point":"EXCHANGE_NO_SUBSTANCE_COST","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"exchange-example"},"references":["IAS 16 §24"],"exercise":{"prompt":{"fr":"","en":"Case data: a haulier exchanges a forklift for an equivalent model from another rental company; the analysis concludes that the exchange lacks commercial substance. Calculate.","es":""},"explanation":{"fr":"","en":"Steps: (1) The exchange of one forklift for an equivalent model has no commercial substance (case data). (2) Without commercial substance, the asset received is measured at the carrying amount of the asset given up: EUR 85,000 (IAS 16, para. 24). (3) The fair value of EUR 110,000 is not used and no EUR 25,000 gain is recognised. Main trap: using the EUR 110,000 fair value and recognising a gain. Rule to remember: without commercial substance, the asset received takes over the carrying amount of the asset given up, with no gain or loss.","es":""},"common_error":{"fr":"","en":"Using 110,000 and recognising a gain of 25,000.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Carrying amount of the forklift given up","es":""},"value":"85000","unit":"EUR"},{"label":{"fr":"","en":"Fair value of the forklift given up","es":""},"value":"110000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Cost of the forklift received","es":""},"answer":85000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Gain recognised on the exchange","es":""},"answer":0,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000079","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.ASSET_EXCHANGE"],"dimension":"PROFESSIONAL_JUDGMENT","format":"CLASSIFICATION","context":"GENERIC","tested_point":"EXCHANGE_MEASUREMENT_BASIS","difficulty":"EXPERT","estimated_time_s":150,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"exchange-rule"},"references":["IAS 16 §24","IAS 16 §25","IAS 16 §26"],"exercise":{"prompt":{"fr":"","en":"For each exchange of non-monetary assets, state the measurement basis of the asset received.","es":""},"explanation":{"fr":"","en":"Steps: for each exchange, first check commercial substance, then whether at least one fair value is reliable. The asset received is measured at fair value if the exchange has commercial substance and at least one fair value is reliably measurable; the fair value of the asset given up is used, unless that of the asset received is more clearly evident (IAS 16, paras. 24 and 26). Otherwise it is measured at the carrying amount of the asset given up (IAS 16, para. 24). Commercial substance is assessed on the change in future cash flows or in entity-specific value (after-tax cash flows), which must be significant relative to the fair value of the assets exchanged (IAS 16, para. 25). Trap: using fair value whenever there is an exchange. Rule to remember: fair value if the exchange has commercial substance and at least one fair value is reliable; otherwise, the carrying amount of the asset given up (IAS 16, para. 24). Effect on the financial statements: a fair value used wrongly would produce a gain or loss on disposal that should not arise.","es":""},"common_error":{"fr":"","en":"Using fair value whenever there is an exchange, without checking for commercial substance or whether fair value is reliable.","es":""},"format":"CLASSIFICATION","categories":[{"id":"FAIR_VALUE","text":{"fr":"","en":"Fair value","es":""}},{"id":"CARRYING_AMOUNT","text":{"fr":"","en":"Carrying amount of the asset given up","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Future cash flows change markedly; the asset given up has an active second-hand market","es":""},"category":"FAIR_VALUE"},{"id":"I2","text":{"fr":"","en":"Both assets generate almost identical cash flows","es":""},"category":"CARRYING_AMOUNT"},{"id":"I3","text":{"fr":"","en":"Commercial substance established, but neither the asset received nor the asset given up has a reliably measurable fair value (unique equipment, no market reference)","es":""},"category":"CARRYING_AMOUNT"},{"id":"I4","text":{"fr":"","en":"Commercial substance established; only the fair value of the asset received is reliable and clearly evident","es":""},"category":"FAIR_VALUE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000080","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.ASSET_EXCHANGE"],"dimension":"RULE_KNOWLEDGE","format":"SINGLE_CHOICE","context":"AVIATION","tested_point":"FAIR_VALUE_GIVEN_UP_FIRST","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"exchange-rule"},"references":["IAS 16 §24","IAS 16 §26"],"exercise":{"prompt":{"fr":"","en":"An airline exchanges a flight simulator for a spare engine; the exchange has commercial substance and both fair values are reliable, neither being more clearly evident. Which fair value is used for the engine?","es":""},"explanation":{"fr":"","en":"Approach: first check that the exchange has commercial substance and that both fair values are reliable, then which of the two is the more evident. When both fair values are reliable, the fair value of the asset given up is used, unless that of the asset received is more clearly evident (IAS 16, para. 26); here, neither is more so. Trap: reflexively using the fair value of the asset received, or an average of the two. Rule to remember: the fair value of the asset given up is used, unless that of the asset received is more clearly evident (IAS 16, para. 26).","es":""},"common_error":{"fr":"","en":"Reflexively using the fair value of the asset received, or an average of the two, instead of starting from the fair value of the asset given up.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The fair value of the simulator given up","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The fair value of the engine received","es":""},"correct":false,"feedback":{"fr":"","en":"This answer starts from the asset received, which reverses the standard's priority. When both fair values are reliable, the fair value of the asset given up is used, unless that of the asset received is more clearly evident (IAS 16, para. 26). Here neither is more evident than the other: the fair value of the simulator given up applies. Rule to remember: by default, the fair value of the asset given up measures the asset received.","es":""}},{"id":"C","text":{"fr":"","en":"The average of the two fair values","es":""},"correct":false,"feedback":{"fr":"","en":"This answer computes an average of the two fair values to be fair. The standard provides for no average: it uses the fair value of the asset given up first, unless that of the asset received is more clearly evident (IAS 16, para. 26). An average would produce a value that matches neither asset. Rule to remember: one fair value is chosen under the priority rule; they are not averaged.","es":""}},{"id":"D","text":{"fr":"","en":"The carrying amount of the simulator","es":""},"correct":false,"feedback":{"fr":"","en":"This answer uses the carrying amount of the simulator. But carrying amount is the measurement basis only when the exchange lacks commercial substance or when no fair value can be measured reliably (IAS 16, para. 24). Here the exchange has commercial substance and both fair values are reliable: carrying amount does not apply. Rule to remember: carrying amount only without commercial substance or without a reliable fair value.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000081","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.ASSET_EXCHANGE"],"dimension":"ANALYSIS","format":"MULTIPLE_CHOICE","context":"TELECOM","tested_point":"COMMERCIAL_SUBSTANCE_INDICATORS","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"exchange-rule"},"references":["IAS 16 §25"],"exercise":{"prompt":{"fr":"","en":"Two operators exchange network equipment. Which elements are relevant in assessing whether the exchange has commercial substance?","es":""},"explanation":{"fr":"","en":"Commercial substance is assessed by reference to the change in the profile of future cash flows (risk, timing, amount) or in entity-specific value, which is based on after-tax cash flows; that change must be significant relative to the fair value of the assets exchanged (IAS 16, para. 25).","es":""},"common_error":{"fr":"","en":"Assessing commercial substance from the accounting gain on the exchange or the label of the assets, rather than from the change in cash flows.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The expected change in the entity's future cash flows","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The change in the entity-specific value of the operations affected","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Cash flows assessed after tax","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"The accounting gain the exchange would allow to be recognised","es":""},"correct":false,"feedback":{"fr":"","en":"This answer takes the accounting gain as the test. But the gain is a consequence of the measurement adopted, not a test of commercial substance: that is assessed on the change in future cash flows or in the entity-specific value (IAS 16, para. 25). Reasoning from the gain would be circular, since the gain depends on the outcome of this test. Rule to remember: commercial substance is judged on the change in cash flows or in entity-specific value (IAS 16, para. 25), not on the gain recognised.","es":""}},{"id":"E","text":{"fr":"","en":"The fact that both assets have the same accounting label","es":""},"correct":false,"feedback":{"fr":"","en":"This answer relies on the accounting label of the assets. But two items of equipment bearing the same label can produce very different cash flows, and two items of different nature can produce almost identical flows. What matters is the change in cash flows or in the entity-specific value, and its significance relative to the fair value of the assets exchanged (IAS 16, para. 25). Rule to remember: the accounting category of the assets says nothing about their commercial substance.","es":""}},{"id":"F","text":{"fr":"","en":"The size of that change relative to the fair value of the assets exchanged","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000082","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.GOVERNMENT_GRANTS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"AGRICULTURE","tested_point":"GRANT_DEDUCTED_ENTRY","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"grants-rule"},"references":["IAS 16 §28"],"exercise":{"prompt":{"fr":"","en":"Case data: a dairy farm buys a milking robot for 250,000 (bank) and receives a government equipment grant of 75,000 (bank). Assumption: under IAS 20, the entity has chosen to deduct the grant from the carrying amount and the recognition conditions are met. Record the purchase and grant entries.","es":""},"explanation":{"fr":"","en":"Steps: (1) The purchase of the robot is recorded at cost: debit property, plant and equipment EUR 250,000, credit bank. (2) Case assumption: under IAS 20, the entity has chosen to deduct the grant from the carrying amount (IAS 16, para. 28). The EUR 75,000 grant received is therefore debited to bank and credited to property, plant and equipment. (3) The carrying amount of the robot is brought down to 250,000 − 75,000 = EUR 175,000; no grant income is recognised on receipt. The choice of presentation and the conditions fall under IAS 20. Main trap: crediting EUR 75,000 to grant income on receipt. Rule to remember: if the grant is presented as a deduction from the carrying amount, it reduces the asset instead of being recognised as income.","es":""},"common_error":{"fr":"","en":"Crediting 75,000 to grant income on receipt.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"BANK","text":{"fr":"","en":"Bank","es":""}},{"id":"GRANT_INCOME","text":{"fr":"","en":"Grant income","es":""}},{"id":"DEFERRED_INCOME","text":{"fr":"","en":"Deferred income","es":""}}],"lines":[{"id":"L1","account":"PPE","side":"DEBIT","amount":250000,"given":["account","side","amount"]},{"id":"L2","account":"BANK","side":"CREDIT","amount":250000,"given":["account","side","amount"]},{"id":"L3","account":"BANK","side":"DEBIT","amount":75000},{"id":"L4","account":"PPE","side":"CREDIT","amount":75000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000083","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.GOVERNMENT_GRANTS"],"dimension":"CALCULATION","format":"CALCULATION","context":"ENERGY","tested_point":"GRANT_EFFECT_ON_CARRYING_AMOUNT","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"grants-rule"},"references":["IAS 16 §28"],"exercise":{"prompt":{"fr":"","en":"Case data: an SME installs an industrial heat pump costing 480,000 and receives a grant of 120,000. Assumptions: presentation as a deduction from the carrying amount (choice made under IAS 20); straight-line depreciation over 8 years, no residual value. Calculate.","es":""},"explanation":{"fr":"","en":"Steps: (1) Case assumption: the grant is presented as a deduction from the carrying amount (choice made under IAS 20); (IAS 16, para. 28). Initial carrying amount = 480,000 − 120,000 = EUR 360,000. (2) Straight-line depreciation over 8 years with no residual value: 360,000 ÷ 8 = EUR 45,000 a year, instead of 480,000 ÷ 8 = EUR 60,000 without the grant. (3) The grant is thus spread through profit or loss via a lower charge, EUR 15,000 a year. Main trap: depreciating the gross cost. Rule to remember: when the grant is deducted from the carrying amount, the charge is computed on the amount net of the grant.","es":""},"common_error":{"fr":"","en":"Depreciating the gross cost of EUR 480,000 even though the grant was presented as a deduction from the carrying amount, or ignoring the grant's effect on the charge.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost of the pump","es":""},"value":"480000","unit":"EUR"},{"label":{"fr":"","en":"Grant","es":""},"value":"120000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"8","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Initial carrying amount","es":""},"answer":360000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Annual depreciation","es":""},"answer":45000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Initial carrying amount","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the pump","es":""},"value":480000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Grant","es":""},"value":120000,"unit":"EUR"}],"result":360000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Annual depreciation","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Initial carrying amount","es":""},"value":360000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Useful life","es":""},"value":8,"unit":"YEARS"}],"result":45000,"unit":"EUR"}],"rationale":{"fr":"","en":"when the grant is deducted from the carrying amount, the charge is computed on the amount net of the grant.","es":""},"references":["REF.IAS16.28"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000084","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DEFERRED_PAYMENT","IAS16.INITIAL_COST.ASSET_EXCHANGE","IAS16.INITIAL_COST.GOVERNMENT_GRANTS"],"dimension":"RULE_KNOWLEDGE","format":"MATCHING","context":"GENERIC","tested_point":"SPECIAL_ACQUISITIONS_OVERVIEW","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"understand"},"references":["IAS 16 §23","IAS 16 §24","IAS 16 §26","IAS 16 §28"],"exercise":{"prompt":{"fr":"","en":"Match each method of acquisition with the initial cost of the asset.","es":""},"explanation":{"fr":"","en":"Steps: for each way of acquiring the asset, identify the basis for initial cost. (1) Deferred payment beyond normal credit: cash price equivalent (IAS 16, para. 23). (2) Exchange with commercial substance and reliable fair value: fair value, in principle that of the asset given up (IAS 16, paras. 24 and 26). (3) Exchange without commercial substance: carrying amount of the asset given up (IAS 16, para. 24). (4) Subsidised purchase with presentation as a deduction chosen under IAS 20: cost less the grant (IAS 16, para. 28). 'Total payments, interest included' is not the cost when credit is abnormal: the cost is the cash price equivalent (IAS 16, para. 23). Main trap: applying the same basis to every way of acquiring. Rule to remember: the way the asset is acquired determines the basis of initial cost.","es":""},"common_error":{"fr":"","en":"Taking total payments, interest included, as cost for deferred payment, or applying one measurement basis to every type of acquisition.","es":""},"format":"MATCHING","left":[{"id":"L1","text":{"fr":"","en":"Payment deferred beyond normal credit","es":""}},{"id":"L2","text":{"fr":"","en":"Exchange with commercial substance and reliable fair value","es":""}},{"id":"L3","text":{"fr":"","en":"Exchange without commercial substance","es":""}},{"id":"L4","text":{"fr":"","en":"Subsidised purchase, deduction presentation chosen under IAS 20","es":""}}],"right":[{"id":"R1","text":{"fr":"","en":"Cash price equivalent","es":""}},{"id":"R2","text":{"fr":"","en":"Fair value (in principle that of the asset given up)","es":""}},{"id":"R3","text":{"fr":"","en":"Carrying amount of the asset given up","es":""}},{"id":"R4","text":{"fr":"","en":"Cost less the grant","es":""}},{"id":"R5","text":{"fr":"","en":"Total payments, interest included","es":""}}],"pairs":[{"left":"L1","right":"R1"},{"left":"L2","right":"R2"},{"left":"L3","right":"R3"},{"left":"L4","right":"R4"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000085","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.POLICY_CHOICE"],"dimension":"APPLICATION","format":"MULTIPLE_CHOICE","context":"MANUFACTURING","tested_point":"MODEL_BY_CLASS","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"policy-choice-rule"},"references":["IAS 16 §29","IAS 16 §36","IAS 16 §37"],"exercise":{"prompt":{"fr":"","en":"An industrial group holds land and buildings, machinery and motor vehicles (three classes). Which policies comply with IAS 16?","es":""},"explanation":{"fr":"","en":"Each class follows one model, chosen as an accounting policy (IAS 16, para. 29); different classes may follow different models, but all items in a revalued class are revalued (IAS 16, paras. 36 and 37).","es":""},"common_error":{"fr":"","en":"Revaluing only the items whose value has risen, or switching every year between cost and revaluation depending on the market.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Land and buildings revalued; machinery and vehicles at cost","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"All classes under the cost model","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Machinery at cost, except the two presses whose market value has risen, which are revalued","es":""},"correct":false,"feedback":{"fr":"","en":"This policy revalues only two presses because their market value has risen. But the revaluation model applies to the whole class: if one item is revalued, all items in its class are revalued (IAS 16, paras. 29 and 36). Example: machinery forms a class; revaluing two presses amounts to cherry-picking increases and leaving the other machines at cost, which the standard does not allow. Rule to remember: the model is chosen by class, not item by item (IAS 16, para. 29).","es":""}},{"id":"D","text":{"fr":"","en":"Vehicles revalued one year and at cost the next, depending on the market","es":""},"correct":false,"feedback":{"fr":"","en":"This policy alternates every year between revaluation and cost depending on the market. But the model is an accounting policy chosen for the class (IAS 16, para. 29), not an option to exercise each year depending on how prices move; a change in accounting policy falls under IAS 8, not developed here. Example: vehicles revalued in N and brought back to cost in N+1 would produce financial statements that are not comparable from one year to the next. Rule to remember: the model chosen for a class is an accounting policy, applied consistently.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000086","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.POLICY_CHOICE","IAS16.MEASUREMENT_MODEL.COST_MODEL"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"RETAIL","tested_point":"MODEL_CHOICE_CONSEQUENCES","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"judgment"},"references":["IAS 16 §29","IAS 16 §30","IAS 16 §31","IAS 16 §36","IAS 16 §37"],"exercise":{"prompt":{"fr":"","en":"Analyse the file and answer.","es":""},"explanation":{"fr":"","en":"Steps: (1) The 40 stores form one class, 'land and buildings': the model chosen, cost or revaluation, applies to the whole class (IAS 16, paras. 29, 36 and 37). (2) Option 1, revaluing only six stores, is therefore ruled out: only option 2 complies. (3) If the chain keeps the cost model, the stores stay at cost less accumulated depreciation and impairment losses, i.e. EUR 120 million, ignoring the EUR 190 million study (IAS 16, para. 30). Only a revaluation of the whole class would bring fair value into the statements (IAS 16, para. 31). Professional judgement: moving to revaluation would improve information on value, at the price of regular valuations; it is a policy decision to document, not a selection of assets. Main trap: picking the most appreciated stores. Rule to remember: the model applies to the whole class.","es":""},"common_error":{"fr":"","en":"Revaluing only the assets that have risen most, instead of choosing a model for the whole class.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"A retail chain owns 40 stores (class \"land and buildings\"), under the cost model. Total carrying amount: 120 million; an external study estimates their fair value at 190 million. The CFO proposes two options: (1) revalue only the 6 Paris stores, whose value has risen most; (2) move the whole class to the revaluation model.","es":""},"parts":[{"prompt":{"fr":"","en":"Which option complies with IAS 16?","es":""},"explanation":{"fr":"","en":"Approach: check the scope to which the model applies. The model chosen applies to the entire class (IAS 16, paras. 29 and 36). Rule to remember: cost or revaluation, the choice applies to the entire class (IAS 16, para. 29).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Option 2 only","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Option 1 only","es":""},"correct":false,"feedback":{"fr":"","en":"Revaluing six stores in a class that has forty amounts to choosing which assets to revalue: if one item is revalued, its whole class must be (IAS 16, paras. 29 and 36). The 40 stores form the class \"land and buildings\" (case data). Rule to remember: the revaluation model applies to the entire class, not to a selection of stores (IAS 16, para. 36).","es":""}},{"id":"C","text":{"fr":"","en":"Both options","es":""},"correct":false,"feedback":{"fr":"","en":"Option 1 does not respect the application of the model to the entire class: if one item is revalued, the whole class to which it belongs must be (IAS 16, paras. 29 and 36). The two options therefore cannot both be compliant. Rule to remember: only one option is compliant, the one that applies the model to the entire class (IAS 16, paras. 29 and 36).","es":""}}],"id":"P1","dimension":"RULE_KNOWLEDGE"},{"prompt":{"fr":"","en":"If the chain keeps the cost model, it presents the stores at 120 million, ignoring the 190 million study.","es":""},"explanation":{"fr":"","en":"True. Approach: identify the model applied. Under the cost model, the carrying amount remains cost less accumulated depreciation and impairment losses (IAS 16, para. 30); a revaluation of the whole class would bring fair value into the accounts (IAS 16, para. 31). Trap: using the 190 million study without having changed model. Rule to remember: under the cost model, a fair value study does not change the carrying amount (IAS 16, para. 30).","es":""},"common_error":{"fr":"","en":"Using the 190 million study without changing model: under the cost model, fair value does not change carrying amount.","es":""},"format":"TRUE_FALSE","answer":true,"id":"P2","dimension":"ANALYSIS"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000087","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.POLICY_CHOICE","IAS16.MEASUREMENT_MODEL.COST_MODEL"],"dimension":"DOCUMENTATION","format":"ERROR_SPOT","context":"GENERIC","tested_point":"POLICY_NOTE_REVIEW","difficulty":"EXPERT","estimated_time_s":150,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"pitfalls"},"references":["IAS 16 §29","IAS 16 §30","IAS 16 §36"],"exercise":{"prompt":{"fr":"","en":"You are reviewing the draft note \"accounting policies — property, plant and equipment\". Spot the erroneous sentences.","es":""},"explanation":{"fr":"","en":"Steps: compare each sentence with the definition of the cost model and the class rule. Under the cost model, the carrying amount is cost less accumulated depreciation and accumulated impairment losses (IAS 16, para. 30): impairment losses are therefore deducted from the carrying amount and not merely disclosed in the notes. The choice of model applies to an entire class (IAS 16, para. 29) and, if one item is revalued, its whole class is (IAS 16, para. 36). Sentence S3 also contradicts S1: an accounting policies note must be consistent. Trap: showing impairment losses only in the notes, or revaluing the head-office building alone because its value has risen. Rule to remember: cost model = cost − accumulated depreciation − accumulated impairment losses (IAS 16, para. 30); the model is chosen by class (IAS 16, paras. 29 and 36). Effect on the financial statements: not deducting impairment losses would overstate property, plant and equipment.","es":""},"common_error":{"fr":"","en":"Presenting impairment losses only in the notes under the cost model, or revaluing the head office building alone because its value has risen.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The group applies the cost model to all its classes of property, plant and equipment.","es":""},"erroneous":false},{"id":"S2","text":{"fr":"","en":"Under this model, items are carried at cost less accumulated depreciation; impairment losses are presented only in the notes.","es":""},"erroneous":true,"correction":{"fr":"","en":"The carrying amount is also reduced by accumulated impairment losses (IAS 16, para. 30).","es":""}},{"id":"S3","text":{"fr":"","en":"As an exception, the head office building, whose value has risen sharply, is the only item revalued within the \"land and buildings\" class.","es":""},"erroneous":true,"correction":{"fr":"","en":"If one item is revalued, its whole class must be revalued (IAS 16, paras. 29 and 36).","es":""}},{"id":"S4","text":{"fr":"","en":"Increases in market value are not recognised while the cost model is applied.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000088","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.COST_MODEL"],"dimension":"CALCULATION","format":"CALCULATION","context":"RETAIL","tested_point":"COST_MODEL_CARRYING_AMOUNT","difficulty":"BEGINNER","estimated_time_s":90,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"cost-model-example"},"references":["IAS 16 §30"],"exercise":{"prompt":{"fr":"","en":"Case data: a cold store, under the cost model, cost 850,000; annual depreciation 85,000 (assumption: straight-line). At the end of the third year an impairment loss of 40,000 was recognised. Calculate at 31 December of year 3.","es":""},"explanation":{"fr":"","en":"Steps: (1) Accumulated depreciation after 3 years: 3 × 85,000 = EUR 255,000. (2) Under the cost model, the carrying amount is cost less accumulated depreciation and accumulated impairment losses (IAS 16, para. 30). (3) Carrying amount at 31 December of year 3: 850,000 − 255,000 − 40,000 = EUR 555,000. Main trap: forgetting the impairment loss and answering EUR 595,000. Rule to remember: carrying amount = cost − accumulated depreciation − accumulated impairment losses.","es":""},"common_error":{"fr":"","en":"Forgetting the impairment loss and answering 595,000.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost","es":""},"value":"850000","unit":"EUR"},{"label":{"fr":"","en":"Annual depreciation","es":""},"value":"85000","unit":"EUR"},{"label":{"fr":"","en":"Years elapsed","es":""},"value":"3","unit":"YEARS"},{"label":{"fr":"","en":"Accumulated impairment losses","es":""},"value":"40000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Accumulated depreciation","es":""},"answer":255000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Carrying amount","es":""},"answer":555000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Accumulated depreciation","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Years elapsed","es":""},"value":3,"unit":"YEARS"},{"symbol":"b","meaning":{"fr":"","en":"Annual depreciation","es":""},"value":85000,"unit":"EUR"}],"result":255000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Carrying amount","es":""},"expression":"a - b - c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":850000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Accumulated depreciation","es":""},"value":255000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Accumulated impairment losses","es":""},"value":40000,"unit":"EUR"}],"result":555000,"unit":"EUR"}],"rationale":{"fr":"","en":"carrying amount = cost − accumulated depreciation − accumulated impairment losses.","es":""},"references":["REF.IAS16.30"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000089","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.COST_MODEL"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"TRANSPORT","tested_point":"COST_MODEL_COMPONENTS","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"cost-model-rule"},"references":["IAS 16 §30"],"exercise":{"prompt":{"fr":"","en":"A transport company applies the cost model to its coaches. Classify each event.","es":""},"explanation":{"fr":"","en":"Steps: under the cost model, carrying amount = cost − accumulated depreciation − accumulated impairment losses (IAS 16, para. 30). For each event, ask whether it moves one of these terms. The year's depreciation charge increases accumulated depreciation: it changes the carrying amount. An impairment loss recognised under IAS 36 increases accumulated impairment losses: it changes it too. A rise in second-hand coach prices and an insurer's valuation above the carrying amount affect none of the three terms: market increases in value are not recognised. Main trap: letting the carrying amount follow the market or a valuation. Rule to remember: under the cost model, the carrying amount is cost less accumulated depreciation and accumulated impairment losses (IAS 16, para. 30).","es":""},"common_error":{"fr":"","en":"Letting the carrying amount move with the market or a third party's valuation, when the cost model changes it only through depreciation and impairment.","es":""},"format":"CLASSIFICATION","categories":[{"id":"CHANGES","text":{"fr":"","en":"Changes the carrying amount","es":""}},{"id":"NO_CHANGE","text":{"fr":"","en":"Does not change the carrying amount","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Depreciation charge for the year","es":""},"category":"CHANGES"},{"id":"I2","text":{"fr":"","en":"Impairment loss recognised under IAS 36","es":""},"category":"CHANGES"},{"id":"I3","text":{"fr":"","en":"Rise in second-hand coach prices on the market","es":""},"category":"NO_CHANGE"},{"id":"I4","text":{"fr":"","en":"Insurer's appraisal above the carrying amount","es":""},"category":"NO_CHANGE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000090","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.DECOMMISSIONING_CHANGES"],"dimension":"CALCULATION","format":"CALCULATION","context":"ENERGY","tested_point":"REVISED_DEPRECIABLE_AMOUNT","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"decommissioning-changes-example"},"references":["IAS 16 §18","IAS 16 §63","IAS 16 §76","IFRIC 1"],"exercise":{"prompt":{"fr":"","en":"Case data: a wind farm is carried under the cost model (assumptions: straight-line, no residual value). At 31 December N, after the year's depreciation, its carrying amount is 900,000 and 9 years of use remain. The decommissioning provision, measured under IAS 37 (IAS 16, para. 18), is revised upwards by 45,000 at that date. Calculate.","es":""},"explanation":{"fr":"","en":"Steps: (1) The dismantling provision is revised upwards by EUR 45,000: the increase is added to the cost of the asset (IFRIC 1, para. 5). The carrying amount rises from 900,000 to EUR 945,000. (2) The adjusted depreciable amount is spread over the remaining useful life: 945,000 ÷ 9 = EUR 105,000 a year from N+1 (IFRIC 1, para. 7). (3) The increase also calls for considering a possible impairment loss (IAS 16, para. 63), and the change in estimate is disclosed in the notes (IAS 16, para. 76). Main trap: expensing the EUR 45,000, or depreciating it over the original total life. Rule to remember: the revision of the provision adjusts cost, and the charge is recomputed over the remaining life.","es":""},"common_error":{"fr":"","en":"Expensing the 45,000, or depreciating it over the original total life.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Carrying amount before revision","es":""},"value":"900000","unit":"EUR"},{"label":{"fr":"","en":"Increase in the provision","es":""},"value":"45000","unit":"EUR"},{"label":{"fr":"","en":"Remaining useful life","es":""},"value":"9","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Carrying amount after revision","es":""},"answer":945000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Annual depreciation from N+1","es":""},"answer":105000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S2","meaning":{"fr":"","en":"Annual depreciation from N+1","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount after revision","es":""},"value":945000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Remaining useful life","es":""},"value":9,"unit":"YEARS"}],"result":105000,"unit":"EUR"}],"rationale":{"fr":"","en":"the revision of the provision adjusts cost, and the charge is recomputed over the remaining life.","es":""},"references":["REF.IAS16.63","REF.IAS16.76","REF.IFRIC1.5","REF.IFRIC1.7"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000091","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.DECOMMISSIONING_CHANGES"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"MINING","tested_point":"DECREASE_CAPPED_AT_CARRYING_AMOUNT","difficulty":"EXPERT","estimated_time_s":180,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"decommissioning-changes-entry"},"references":["IAS 16 §76","IFRIC 1"],"exercise":{"prompt":{"fr":"","en":"Case data: an ore processing plant, almost fully depreciated, has a carrying amount of 25,000 (cost model). A new dismantling technique reduces the decommissioning provision by 32,000. Record the revision entry.","es":""},"explanation":{"fr":"","en":"Steps: (1) The dismantling provision decreases by EUR 32,000: debit the provision EUR 32,000. (2) The decrease is deducted from the cost of the asset, up to its carrying amount (IFRIC 1, para. 5): credit property, plant and equipment EUR 25,000, bringing its carrying amount to zero. (3) The excess, 32,000 − 25,000 = EUR 7,000, is recognised in profit or loss, as a credit. Check: debit 32,000 = credits 25,000 + 7,000. The change in estimate is disclosed under IAS 8 (IAS 16, para. 76). Main trap: crediting the asset EUR 32,000 and making its carrying amount negative. Rule to remember: a decrease in the provision cannot take the asset's carrying amount below zero; the excess goes to profit or loss.","es":""},"common_error":{"fr":"","en":"Crediting PPE with 32,000 and making its carrying amount negative.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"DECOMMISSIONING_PROVISION","text":{"fr":"","en":"Decommissioning provision","es":""}},{"id":"OTHER_INCOME","text":{"fr":"","en":"Profit or loss — income on provision revision","es":""}},{"id":"FINANCE_COSTS","text":{"fr":"","en":"Finance costs","es":""}},{"id":"REVALUATION_SURPLUS","text":{"fr":"","en":"Revaluation surplus (OCI)","es":""}}],"lines":[{"id":"L1","account":"DECOMMISSIONING_PROVISION","side":"DEBIT","amount":32000},{"id":"L2","account":"PPE","side":"CREDIT","amount":25000},{"id":"L3","account":"OTHER_INCOME","side":"CREDIT","amount":7000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000092","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.DECOMMISSIONING_CHANGES"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"TELECOM","tested_point":"UNWINDING_VS_REVISION","difficulty":"EXPERT","estimated_time_s":210,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"decommissioning-changes-how"},"references":["IAS 16 §63","IFRIC 1"],"exercise":{"prompt":{"fr":"","en":"Case data: the decommissioning provision for a fibre network stands at 200,000 on 1 January N (cost model). The effect of the passage of time in N, at the case rate of 4%, is 8,000. At 31 December N, a new estimate brings the provision to 230,000. Record the combined entry for the year relating to the provision.","es":""},"explanation":{"fr":"","en":"Steps: (1) Total change in the provision: 230,000 − 200,000 = EUR 30,000, as a credit. (2) The part due to the passage of time, EUR 8,000, is a finance cost for the year (IFRIC 1, para. 8). (3) The rest is a revision of estimate: 230,000 − (200,000 + 8,000) = EUR 22,000, added to the cost of the asset (IFRIC 1, para. 5), with consideration of a possible impairment loss (IAS 16, para. 63). Entry: debit finance costs 8,000 and property, plant and equipment 22,000; credit the provision 30,000. Main trap: adding the EUR 30,000 to cost, or expensing all of it as finance costs. Rule to remember: separate the effect of the passage of time, a finance cost, from the revision of estimate, which adjusts the asset's cost.","es":""},"common_error":{"fr":"","en":"Adding the full 30,000 to the cost of the asset, or expensing it all as finance cost.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment","es":""}},{"id":"DECOMMISSIONING_PROVISION","text":{"fr":"","en":"Decommissioning provision","es":""}},{"id":"FINANCE_COSTS","text":{"fr":"","en":"Finance costs","es":""}},{"id":"OTHER_INCOME","text":{"fr":"","en":"Profit or loss — income on provision revision","es":""}}],"lines":[{"id":"L1","account":"FINANCE_COSTS","side":"DEBIT","amount":8000},{"id":"L2","account":"PPE","side":"DEBIT","amount":22000},{"id":"L3","account":"DECOMMISSIONING_PROVISION","side":"CREDIT","amount":30000,"given":["account","side"]}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000093","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.DECOMMISSIONING_CHANGES"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"ENERGY","tested_point":"INCREASE_ADDED_TO_COST","difficulty":"ADVANCED","estimated_time_s":75,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"decommissioning-changes-rule"},"references":["IAS 16 §63","IAS 16 §76","IFRIC 1"],"exercise":{"prompt":{"fr":"","en":"Cost model. Tighter regulation increases the estimated decommissioning provision for a power plant. What is the treatment?","es":""},"explanation":{"fr":"","en":"Steps: (1) Under the cost model, an upward revision of the dismantling provision is added to the cost of the asset (IFRIC 1, para. 5). (2) That increase may indicate impairment: it is considered under IAS 36 (IAS 16, para. 63). (3) It is a change in estimate, with no restatement of prior years (IAS 16, para. 76). Main trap: expensing the increase or treating it as an error. Rule to remember: under the cost model, the revision of the provision adjusts the asset's cost, and one then checks whether there is an indication of impairment.","es":""},"common_error":{"fr":"","en":"Expensing the increase in the dismantling provision, or treating it as an error, instead of adjusting the asset's cost and considering a possible impairment loss.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Add the increase to the cost of the plant and consider whether there is an indication of impairment","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Recognise the increase as an expense of the period","es":""},"correct":false,"feedback":{"fr":"","en":"This answer expenses the increase in the period. But under the cost model, a revision of the dismantling provision adjusts the cost of the asset (IFRIC 1, para. 5): the counterpart of the provision is not an immediate expense. Example: a EUR 45,000 increase is added to the plant's carrying amount and depreciated over the remaining life. Rule to remember: under the cost model, an increase in the provision raises the asset's cost; it does not go to expenses.","es":""}},{"id":"C","text":{"fr":"","en":"Restate prior periods as an error","es":""},"correct":false,"feedback":{"fr":"","en":"This answer treats the increase as an error to correct retrospectively. But a revision of the provision estimate, here caused by tighter regulation, is a change in estimate, which affects the current and later periods without restating prior years (IAS 16, para. 76). An error would require the earlier estimate to have been wrongly made from information available. Rule to remember: a change in data or estimate applies prospectively; it is not corrected like an error.","es":""}},{"id":"D","text":{"fr":"","en":"Recognise the increase in other comprehensive income","es":""},"correct":false,"feedback":{"fr":"","en":"This answer takes the increase to other comprehensive income, as for a revaluation. But a revaluation surplus arises only under the revaluation model (IFRIC 1, para. 6); the case here specifies the cost model, where the increase is added to the asset's cost (IFRIC 1, para. 5). Example: the plant is not revalued, so there is no revaluation surplus against which to take the change. Rule to remember: recognition in OCI belongs to the revaluation model, not to the cost model.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000094","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.DECOMMISSIONING_CHANGES"],"dimension":"RULE_KNOWLEDGE","format":"MATCHING","context":"GENERIC","tested_point":"DECOMMISSIONING_CHANGES_MAP","difficulty":"EXPERT","estimated_time_s":120,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"decommissioning-changes-rule"},"references":["IAS 16 §76","IFRIC 1"],"exercise":{"prompt":{"fr":"","en":"Match each change in the decommissioning provision with its treatment.","es":""},"explanation":{"fr":"","en":"Steps: for each change, identify its nature (unwinding of discount or revision of estimate) and the measurement model. (1) The effect of the passage of time is a finance cost in profit or loss (IFRIC 1, para. 8). (2) Under the cost model, an upward revision of estimate is added to the asset's cost (IFRIC 1, para. 5). (3) Under the cost model, a decrease larger than the carrying amount is deducted up to that amount, with the excess going to profit or loss (IFRIC 1, para. 5). (4) Under the revaluation model, the change goes to the revaluation surplus or to profit or loss as the case may be (IFRIC 1, para. 6). A revision of estimate is a change in estimate whose nature and effect are to be disclosed (IAS 16, para. 76): R5 is matched to no change. Main trap: applying the cost-model treatment under the revaluation model. Rule to remember: unwinding is a finance cost; a revision of estimate follows the measurement model (IFRIC 1, paras. 5 and 6).","es":""},"common_error":{"fr":"","en":"Applying the cost-model treatment to every change in the provision, or restating prior years for a mere revision of estimate.","es":""},"format":"MATCHING","left":[{"id":"L1","text":{"fr":"","en":"Effect of the passage of time (unwinding)","es":""}},{"id":"L2","text":{"fr":"","en":"Increase in estimate, cost model","es":""}},{"id":"L3","text":{"fr":"","en":"Decrease in estimate exceeding the carrying amount, cost model","es":""}},{"id":"L4","text":{"fr":"","en":"Change in estimate, revaluation model","es":""}}],"right":[{"id":"R1","text":{"fr":"","en":"Finance cost in profit or loss","es":""}},{"id":"R2","text":{"fr":"","en":"Addition to the cost of the asset","es":""}},{"id":"R3","text":{"fr":"","en":"Deduction up to the carrying amount, excess in profit or loss","es":""}},{"id":"R4","text":{"fr":"","en":"Revaluation surplus (OCI) or profit or loss, depending on the case","es":""}},{"id":"R5","text":{"fr":"","en":"Retrospective restatement of prior periods","es":""}}],"pairs":[{"left":"L1","right":"R1"},{"left":"L2","right":"R2"},{"left":"L3","right":"R3"},{"left":"L4","right":"R4"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000095","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.INSURANCE_LINKED_OPTION"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"INSURANCE","tested_point":"INSURANCE_LINKED_OPTION_SCOPE","difficulty":"EXPERT","estimated_time_s":75,"lesson_id":"LS.IAS16.000008","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"insurance-option"},"references":["IAS 16 §29","IAS 16 §29A","IAS 16 §29B"],"exercise":{"prompt":{"fr":"","en":"An insurer issues life insurance contracts with direct participation features and holds, among the underlying items, the building it occupies as head office. What does IAS 16 allow for this building?","es":""},"explanation":{"fr":"","en":"Approach: check whether the property is owner-occupied and included in the fund or in the underlying items of the contracts. As an exception to paragraph 29, such properties may be measured using the IAS 40 fair value model (IAS 16, para. 29A) and form a separate class of property, plant and equipment (IAS 16, para. 29B). Trap: extending the option to all of the insurer's occupied buildings, or turning the building into investment property. Rule to remember: the option in paragraph 29A concerns the measurement method for owner-occupied properties included in the fund or underlying items, not their nature. Effect on the financial statements: these properties remain presented with property, plant and equipment, in a separate class.","es":""},"common_error":{"fr":"","en":"Believing that the IAS 40 fair value option applies to all of an insurer's owner-occupied buildings, or that it turns the building into investment property.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Measure it under the IAS 40 fair value model, in a separate class","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Only the cost model, like any owner-occupied property","es":""},"correct":false,"feedback":{"fr":"","en":"This answer rules out the option, on the basis that every owner-occupied property follows the cost or revaluation model. But, as an exception to paragraph 29, an entity that manages an investment fund or issues insurance contracts with direct participation features and holds the underlying items may measure owner-occupied property included in that fund or those underlying items using the IAS 40 fair value model (IAS 16, para. 29A). Rule to remember: paragraph 29A opens a specific option for these properties, in addition to the usual models.","es":""}},{"id":"C","text":{"fr":"","en":"Reclassify it compulsorily as investment property","es":""},"correct":false,"feedback":{"fr":"","en":"This answer makes it a mandatory reclassification as investment property. But the owner-occupied building remains property, plant and equipment: the option concerns the measurement method, the IAS 40 fair value model, and these properties form a separate class of property, plant and equipment (IAS 16, paras. 29A and 29B). So there is neither reclassification nor obligation. Rule to remember: the option changes the measurement method, not the nature of the asset.","es":""}},{"id":"D","text":{"fr":"","en":"The option extends to all the insurer's owner-occupied property","es":""},"correct":false,"feedback":{"fr":"","en":"This answer extends the option to all of the insurer's owner-occupied buildings. But it covers only owner-occupied property that is included in the fund or in the underlying items of contracts with direct participation features (IAS 16, para. 29A). Example: a head office that is not among the underlying items stays measured under the cost or revaluation model. Rule to remember: the option is limited to owner-occupied property included in the fund or the underlying items.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000099","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.ENTIRE_CLASS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"HOSPITALITY","tested_point":"MODEL_CHOSEN_BY_CLASS","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"frequency-class-rule"},"references":["IAS 16 §29","IAS 16 §36","IAS 16 §37"],"exercise":{"prompt":{"fr":"","en":"Case data: a hotel group applies the revaluation model to its 'land and buildings' class and the cost model to its 'furniture and fixtures' class. True or false: this combination complies with IAS 16.","es":""},"explanation":{"fr":"","en":"True. Steps: (1) the choice between the cost model and the revaluation model is an accounting policy applied to an entire class (IAS 16, para. 29); (2) 'land and buildings' and 'furniture and fittings' are two distinct classes, of different nature and use (IAS 16, para. 37); (3) each may therefore follow its own model. The constraint operates within a class: if one item is revalued, its whole class is (IAS 16, para. 36). Main trap: believing that revaluation, once chosen, applies to all property, plant and equipment. Rule to remember: the model is chosen by class and applies to the entire class (IAS 16, para. 29).","es":""},"common_error":{"fr":"","en":"Believing that once the revaluation model is chosen, it applies to all the entity's property, plant and equipment.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000100","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.MODEL_CONDITIONS"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"RETAIL","tested_point":"REVALUED_AMOUNT_COMPOSITION","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"conditions-rule"},"references":["IAS 16 §31"],"exercise":{"prompt":{"fr":"","en":"Case data: a store was revalued at EUR 3,000,000 two years ago. Since then it has been depreciated by EUR 120,000 a year and an impairment loss of EUR 150,000 was recognised last year. Its current fair value, not used since no revaluation takes place this year, would be EUR 3,100,000. What is its carrying amount?","es":""},"explanation":{"fr":"","en":"Approach: start from the revalued amount, then deduct subsequent depreciation and impairment losses. Revalued amount = fair value at the date of revaluation − subsequent depreciation − subsequent impairment losses (IAS 16, para. 31): 3,000,000 − 2 × 120,000 − 150,000 = EUR 2,610,000. The current fair value of 3,100,000 is not used, because no revaluation takes place this year. Trap: confusing the revaluation model with continuous measurement at fair value. Rule to remember: between two revaluations, the carrying amount is the latest revalued amount less subsequent depreciation and impairment losses (IAS 16, para. 31).","es":""},"common_error":{"fr":"","en":"Confusing the revaluation model with continuous fair value measurement.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"EUR 2,610,000","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"EUR 2,760,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount forgets the EUR 150,000 impairment loss recognised last year: it deducts only depreciation (3,000,000 − 240,000 = EUR 2,760,000). The revalued amount is fair value at the date of revaluation less subsequent accumulated depreciation and subsequent accumulated impairment losses (IAS 16, para. 31). Example: 2,760,000 − 150,000 = EUR 2,610,000. Rule to remember: after a revaluation, both subsequent depreciation and subsequent impairment losses are deducted.","es":""}},{"id":"C","text":{"fr":"","en":"EUR 3,000,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount freezes the store at the fair value of the last revaluation, as if it no longer moved. But the revalued amount is fair value at the date of revaluation less subsequent depreciation and impairment losses (IAS 16, para. 31): 3,000,000 − 2 × 120,000 − 150,000 = EUR 2,610,000. Example: each year of depreciation removes EUR 120,000 from the carrying amount. Rule to remember: the revalued amount is a starting point, which is then reduced by depreciation and impairment losses.","es":""}},{"id":"D","text":{"fr":"","en":"EUR 3,100,000","es":""},"correct":false,"feedback":{"fr":"","en":"This amount uses today's fair value, EUR 3,100,000. But between revaluations, current fair value is not recognised: the model is not continuous fair value measurement, but the last revaluation reduced by subsequent depreciation and impairment losses (IAS 16, para. 31). Here no revaluation takes place this year. Rule to remember: the carrying amount rests on the latest revalued amount, less subsequent depreciation and impairment losses (IAS 16, para. 31).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000101","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.FAIR_VALUE_MEASUREMENT","IAS16.REVALUATION.MODEL_CONDITIONS"],"dimension":"RULE_KNOWLEDGE","format":"MULTIPLE_CHOICE","context":"REAL_ESTATE","tested_point":"FAIR_VALUE_IFRS13_LINK","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"conditions-rule"},"references":["IAS 16 §6","IAS 16 §31","IAS 16 §77"],"exercise":{"prompt":{"fr":"","en":"A property company is preparing its first revaluation of offices occupied by its own staff. Which statements are correct? (Several answers possible.)","es":""},"explanation":{"fr":"","en":"Fair value is defined by reference to IFRS 13 (IAS 16, para. 6); the model requires it to be reliably measurable (IAS 16, para. 31); the involvement of an independent valuer is a required disclosure (IAS 16, para. 77).","es":""},"common_error":{"fr":"","en":"Believing that IAS 16 itself details the fair value measurement techniques, or that a simple management estimate is enough to revalue.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The fair value used is as defined in IFRS 13.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"IAS 16 contains its own paragraphs detailing fair value measurement techniques.","es":""},"correct":false,"feedback":{"fr":"","en":"This statement credits IAS 16 with paragraphs on fair value measurement techniques. Those paragraphs (32 and 33) were deleted when IFRS 13 was issued; fair value is now defined by reference to IFRS 13 (IAS 16, para. 6). Example: to value the offices, the property company applies the IFRS 13 methods and hierarchy, not a guide inside IAS 16. Rule to remember: IAS 16 refers to IFRS 13 for the definition and measurement of fair value.","es":""}},{"id":"C","text":{"fr":"","en":"The notes state whether an independent valuer was involved.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"If no reliable fair value is available, management's free estimate is enough to apply the model.","es":""},"correct":false,"feedback":{"fr":"","en":"This statement allows a free estimate by management. But the revaluation model requires that the fair value of the item can be measured reliably (IAS 16, para. 31): without a reliable fair value, the model does not apply. Example: management's mere impression that the offices are 'worth more' is not a reliable measurement. Rule to remember: no reliably measurable fair value, no revaluation model.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000102","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.FAIR_VALUE_MEASUREMENT","IAS16.REVALUATION.ENTIRE_CLASS"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"REAL_ESTATE","tested_point":"EXTERNAL_VALUATION_REVIEW","difficulty":"ADVANCED","estimated_time_s":420,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"judgment"},"references":["IAS 16 §6","IAS 16 §31","IAS 16 §36","IAS 16 §37","IAS 16 §38","IAS 16 §77"],"exercise":{"prompt":{"fr":"","en":"Review the valuation file prepared for the 31 December N closing.","es":""},"explanation":{"fr":"","en":"Steps: an expert's report is evidence to assess, not a conclusion to rubber-stamp. (1) Scope: the 'warehouses' class has 10 warehouses and all must be revalued (IAS 16, para. 36); the report covers only 9, the Lille warehouse not being valued. (2) Currency: the valuation date of 30 June is six months before the reporting date while the market has risen markedly; the carrying amount may differ from fair value at the reporting date (IAS 16, paras. 31 and 38). (3) Fair value is understood as in IFRS 13 (IAS 16, para. 6), and the involvement of an independent valuer is a disclosure (IAS 16, para. 77): using an external expert and comparing with transactions are not weaknesses. Professional judgement: ask for the Lille valuation, an update at the reporting date or an analysis showing no significant difference, and document it. Main trap: settling for 9 warehouses out of 10 and an old date. Rule to remember: complete scope and up-to-date value.","es":""},"common_error":{"fr":"","en":"Approving a valuation report without checking that it covers the whole class or that its valuation date is current relative to the reporting date.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Nordlog, a logistics group, applies the revaluation model to its 'warehouses' class, which comprises 10 warehouses. The logistics property market rose markedly in the second half of N (case data). The management accountant sends you the valuation report for approval.","es":""},"exhibits":[{"title":{"fr":"","en":"Extract from the valuation report (case data)","es":""},"body":{"fr":"","en":"Valuation date: 30 June N. Scope: 9 warehouses out of 10; the Lille warehouse, 'under renovation', was not visited. Method: comparison with recent market transactions. Valuer: accredited external firm with no link to Nordlog.","es":""}}],"parts":[{"prompt":{"fr":"","en":"What weaknesses does the file show?","es":""},"explanation":{"fr":"","en":"The entire class must be revalued (IAS 16, para. 36) and, on a rolling basis, values must be kept up to date (IAS 16, para. 38). With a sharply rising market, a 30 June value may differ materially from fair value at the reporting date (IAS 16, para. 31). The independent valuer is disclosed in the notes (IAS 16, para. 77).","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"One warehouse in the class is not valued.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The valuation date is six months before the reporting date, while the market has risen markedly since.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The method based on comparison with market transactions is prohibited.","es":""},"correct":false,"feedback":{"fr":"","en":"Nothing in the file shows that comparison with market transactions is a problem: IAS 16 defines fair value by reference to IFRS 13 (IAS 16, para. 6), and the measurement of fair value falls under that standard. This approach is therefore not a weakness of the file. Rule to remember: the choice of valuation technique falls under IFRS 13, it is not prohibited by IAS 16 (IAS 16, para. 6).","es":""}},{"id":"D","text":{"fr":"","en":"Using an independent external valuer breaches the standard.","es":""},"correct":false,"feedback":{"fr":"","en":"Using an independent external valuer is not contrary to the standard: IAS 16 on the contrary calls for disclosing whether an independent valuer was involved (IAS 16, para. 77). It is therefore not a weakness of the file. Rule to remember: the involvement of an independent valuer is part of the information to disclose on revalued assets (IAS 16, para. 77).","es":""}}],"id":"P1","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"What do you ask the management accountant for?","es":""},"explanation":{"fr":"","en":"The entire class must be revalued (IAS 16, paras. 36 and 37) and revaluations must be recent enough for the carrying amount not to differ materially from fair value at the reporting date (IAS 16, paras. 31 and 38).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Nothing: 9 warehouses out of 10 are enough, and the date hardly matters.","es":""},"correct":false,"feedback":{"fr":"","en":"Limiting the exercise to 9 warehouses out of 10 and ignoring the date does not respect the whole-class rule: if one item is revalued, its whole class is (IAS 16, para. 36). Revaluations must also be regular enough for the carrying amount not to differ significantly from fair value at the reporting date (IAS 16, para. 31). Rule to remember: complete scope and up-to-date values (IAS 16, paras. 31 and 36).","es":""}},{"id":"B","text":{"fr":"","en":"Value the Lille warehouse and obtain an update of the values at the reporting date (or an analysis showing no material difference), then document it all.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Exclude the Lille warehouse from the class, since it is under renovation.","es":""},"correct":false,"feedback":{"fr":"","en":"A class is defined by the nature and use of the assets (IAS 16, para. 37), not by how convenient valuation is: the renovation of the Lille warehouse does not take it out of the \"warehouses\" class. The whole class must be revalued (IAS 16, para. 36). Rule to remember: an asset is not removed from a class to make valuation easier (IAS 16, paras. 36 and 37).","es":""}}],"id":"P2","dimension":"DOCUMENTATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000103","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.FREQUENCY"],"dimension":"PROFESSIONAL_JUDGMENT","format":"SINGLE_CHOICE","context":"REAL_ESTATE","tested_point":"REVALUE_AFTER_MARKET_SHOCK","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"frequency-class-rule"},"references":["IAS 16 §31","IAS 16 §34"],"exercise":{"prompt":{"fr":"","en":"Case data: an entity revalues its office buildings every four years; the last revaluation was two years ago. This year, published indices show a fall of about 15% in office prices in its cities, a difference management considers material. What must it do at the reporting date?","es":""},"explanation":{"fr":"","en":"Revaluations must be regular enough for the carrying amount not to differ materially from fair value at the reporting date (IAS 16, para. 31). Revaluing only every three or five years is acceptable only when changes are insignificant; with material changes, frequency must increase (IAS 16, para. 34).","es":""},"common_error":{"fr":"","en":"Treating 'every three or five years' as a fixed timetable rather than a consequence of volatility.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Wait for the scheduled date in two years: the standard allows a multi-year cycle.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer relies on the planned multi-year cycle. But revaluing every three to five years is suitable when changes in fair value are not significant (IAS 16, para. 34). Here, the indices show a fall of about 15% that management considers significant: the four-year cycle no longer holds, and the carrying amount could differ from fair value at the reporting date (IAS 16, para. 31). Rule to remember: the multi-year cycle is a consequence of a stable market, not a fixed calendar (IAS 16, para. 34).","es":""}},{"id":"B","text":{"fr":"","en":"Revalue the class at this reporting date.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Revalue only the buildings whose fall exceeds 15%.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer revalues only the buildings whose fall exceeds 15%. But revaluation covers the whole class to which the asset belongs (IAS 16, para. 36): buildings are not selected for revaluation. Example: if the entity revalues the worst-hit buildings and leaves the others at their earlier amount, the class is no longer measured on a consistent basis. Rule to remember: when you revalue, you revalue the whole class.","es":""}},{"id":"D","text":{"fr":"","en":"Abandon the revaluation model and go back to cost.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer abandons the revaluation model because of the fall. But paragraphs 31 and 34 deal with this situation through the frequency of revaluations, not by abandoning the model: revaluations must be regular enough for the carrying amount not to differ significantly from fair value at the reporting date, and frequency depends on changes in fair value (IAS 16, paras. 31 and 34). Example: the entity revalues the class downwards and keeps its model. Rule to remember: faced with a significant market change, it is the frequency of revaluations that adapts (IAS 16, paras. 31 and 34).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000104","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.FREQUENCY"],"dimension":"APPLICATION","format":"CLASSIFICATION","context":"GENERIC","tested_point":"FREQUENCY_BY_VOLATILITY","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"frequency-class-rule"},"references":["IAS 16 §34"],"exercise":{"prompt":{"fr":"","en":"Classify each revalued class according to the revaluation frequency consistent with IAS 16 (case data).","es":""},"explanation":{"fr":"","en":"Approach: for each class, look in the facts at whether fair value moves a lot or not. The warehouses (I1) and the port land (I3) show large, frequent changes: annual revaluation. The office furniture (I2) and the rural buildings in a stable market (I4) do not change significantly: revaluing every three or five years may be enough (IAS 16, para. 34). Main trap: reasoning by type of asset when the test is the volatility of fair value. Rule to remember: the more fair value moves, the closer together the revaluations must be.","es":""},"common_error":{"fr":"","en":"Classifying assets by their nature (property annually, furniture every few years) instead of looking at how volatile their fair value is.","es":""},"format":"CLASSIFICATION","categories":[{"id":"ANNUAL","text":{"fr":"","en":"Annual revaluation","es":""}},{"id":"MULTI_YEAR","text":{"fr":"","en":"Every three or five years","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Logistics warehouses whose fair value changes sharply from year to year","es":""},"category":"ANNUAL"},{"id":"I2","text":{"fr":"","en":"Office furniture whose fair value changes only marginally","es":""},"category":"MULTI_YEAR"},{"id":"I3","text":{"fr":"","en":"Port land whose prices fluctuate significantly and frequently","es":""},"category":"ANNUAL"},{"id":"I4","text":{"fr":"","en":"Administrative buildings in a rural area, stable market, insignificant differences for years","es":""},"category":"MULTI_YEAR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000105","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.ENTIRE_CLASS"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"HOSPITALITY","tested_point":"ROLLING_REVALUATION_LIMITS","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"example"},"references":["IAS 16 §29","IAS 16 §36","IAS 16 §38"],"exercise":{"prompt":{"fr":"","en":"A hotel group with 15 hotels presents its revaluation plan. Spot the statements that do not comply with IAS 16.","es":""},"explanation":{"fr":"","en":"Steps: check the scope of the class, then the timing. The model is chosen by class (IAS 16, para. 29); if one item is revalued, the whole class is (IAS 16, para. 36), simultaneously or on a rolling basis within a short period, provided the revaluations are kept up to date (IAS 16, para. 38). Case convention: a plan spread over three years is treated as not meeting the short-period condition. Trap: revaluing only the assets that are going up, or calling a multi-year spread a \"rolling\" revaluation. Rule to remember: the whole class is revalued, at the same time or on a rolling basis within a short period with up-to-date values (IAS 16, paras. 36 and 38). Effect on the financial statements: a selective or overly spread revaluation would mix, within one class, values of different dates.","es":""},"common_error":{"fr":"","en":"Revaluing only the assets whose value is rising, or spreading the revaluation of a class over several years and calling it a \"rolling\" programme.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"'We will revalue five hotels a year: the class will be fully covered in three years.'","es":""},"erroneous":true,"correction":{"fr":"","en":"A rolling basis is allowed only if the revaluation of the class is completed within a short period and kept up to date (IAS 16, para. 38); the Standard does not quantify that period and, as a case convention, a plan spread over three years does not meet it.","es":""}},{"id":"S2","text":{"fr":"","en":"'The 15 hotels will be valued between October and December, with the first values updated at the reporting date if needed.'","es":""},"erroneous":false},{"id":"S3","text":{"fr":"","en":"'The seaside hotels, which have fallen, will stay at cost; only the city hotels will be revalued.'","es":""},"erroneous":true,"correction":{"fr":"","en":"If one item is revalued, its entire class is (IAS 16, para. 36): assets are not selected according to the direction of their change.","es":""}},{"id":"S4","text":{"fr":"","en":"'The shuttle vehicles stay under the cost model, because they form another class.'","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000106","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.MODEL_CONDITIONS","IAS16.REVALUATION.ENTIRE_CLASS"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"LOGISTICS","tested_point":"REVALUATION_CONDITIONS_ASSESSMENT","difficulty":"EXPERT","estimated_time_s":480,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"judgment"},"references":["IAS 16 §6","IAS 16 §29","IAS 16 §31","IAS 16 §36","IAS 16 §38"],"exercise":{"prompt":{"fr":"","en":"Analyse TransVal's plan to move to the revaluation model.","es":""},"explanation":{"fr":"","en":"Three-step approach. 1) Entry condition: fair value must be reliably measurable (IAS 16, para. 31); the recent transactions of comparable platforms (case data) support this, so the model is available. 2) Scope: the model applies to the whole \"land and buildings\" class, so to all 12 platforms and not only the 10 that rose (IAS 16, paras. 29 and 36); point 2 of the note is contrary to the standard. 3) What follows: the revalued amount is still reduced by subsequent depreciation (IAS 16, para. 31); point 3 is therefore wrong. A valuation made in November remains acceptable if it is representative at the reporting date (IAS 16, paras. 31 and 38). Main trap: choosing assets according to the direction of their change. Rule to remember: revalue the whole class on the basis of a reliable fair value, and keep depreciating.","es":""},"common_error":{"fr":"","en":"Wanting to revalue only the assets whose value is rising, and believing that revaluation stops depreciation.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"TransVal holds 12 logistics platforms (class 'land and buildings'), all measured under the cost model. Management wishes to adopt the revaluation model from 31 December N to 'better reflect the value of the property portfolio'. A valuation firm has many recent transactions in comparable platforms (case data).","es":""},"exhibits":[{"title":{"fr":"","en":"Finance department memo (case data)","es":""},"body":{"fr":"","en":"1. Valuation in November N of the 10 platforms that have risen. 2. The 2 eastern platforms, whose value has fallen, will stay at cost. 3. After the revaluation, no more depreciation: the value will be updated at each valuation.","es":""}}],"parts":[{"prompt":{"fr":"","en":"Is the entry condition for the revaluation model met?","es":""},"explanation":{"fr":"","en":"The model applies if fair value, as defined in IFRS 13, can be measured reliably (IAS 16, paras. 6 and 31); recent comparable transactions support this (case data).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Yes: fair value can be measured reliably thanks to comparable transactions.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"No: only an actual sale price for each platform would allow revaluation.","es":""},"correct":false,"feedback":{"fr":"","en":"The access condition is a fair value that can be measured reliably under IFRS 13, not an actual sale of each platform (IAS 16, paras. 6 and 31). Recent transactions in comparable platforms (case data) can support that fair value. Rule to remember: the revaluation model requires a reliable fair value, not a sale of the asset (IAS 16, para. 31).","es":""}}],"id":"P1","dimension":"RULE_KNOWLEDGE"},{"prompt":{"fr":"","en":"Spot the points of the memo that do not comply.","es":""},"explanation":{"fr":"","en":"Approach: check each point of the memo against scope, date and depreciation. A valuation close to the reporting date is acceptable if it remains representative at that date (IAS 16, paras. 31 and 38). By contrast, excluding assets from the class (IAS 16, para. 36) and ceasing to depreciate (IAS 16, para. 31) are contrary to the standard. Trap: choosing assets according to the direction of their change in value, or believing that revaluation stops depreciation. Rule to remember: the whole class is revalued and the revalued amount continues to be depreciated (IAS 16, paras. 31 and 36).","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"Point 1: valuation carried out in November N for a 31 December N reporting date.","es":""},"erroneous":false},{"id":"S2","text":{"fr":"","en":"Point 2: the platforms that have fallen stay at cost.","es":""},"erroneous":true,"correction":{"fr":"","en":"The entire class is revalued, including the assets that have fallen (IAS 16, paras. 29 and 36).","es":""}},{"id":"S3","text":{"fr":"","en":"Point 3: no more depreciation after the revaluation.","es":""},"erroneous":true,"correction":{"fr":"","en":"The revalued amount is reduced by subsequent depreciation: depreciation continues (IAS 16, para. 31).","es":""}}],"id":"P2","dimension":"ANALYSIS"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000107","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.ACCUMULATED_DEPRECIATION"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"GROSS_RESTATEMENT_CALCULATION","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"numeric-example"},"references":["IAS 16 §35"],"exercise":{"prompt":{"fr":"","en":"A factory revalued under the gross restatement approach. Teaching assumption: the restatement is proportionate (same ratio for gross and depreciation). Calculate the amounts after revaluation.","es":""},"explanation":{"fr":"","en":"Carrying amount: 2,400,000 − 900,000 = 1,500,000. Coefficient: 1,800,000 ÷ 1,500,000 = 1.2. Gross: 2,400,000 × 1.2 = 2,880,000; accumulated depreciation: 900,000 × 1.2 = 1,080,000; gross − depreciation = 1,800,000, the fair value (IAS 16, para. 35). Increase: 1,800,000 − 1,500,000 = 300,000. Main trap: adjusting only the gross amount and leaving accumulated depreciation unchanged, which does not bring the carrying amount back to fair value. Rule to remember: under the restatement approach, gross amount and accumulated depreciation are adjusted consistently so that their difference equals the revalued carrying amount; the proportional coefficient is a teaching assumption here.","es":""},"common_error":{"fr":"","en":"Applying the ratio to the gross amount only, without restating accumulated depreciation.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Gross carrying amount before revaluation","es":""},"value":"2400000","unit":"EUR"},{"label":{"fr":"","en":"Accumulated depreciation before revaluation","es":""},"value":"900000","unit":"EUR"},{"label":{"fr":"","en":"Fair value at the revaluation date","es":""},"value":"1800000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Restatement ratio (fair value ÷ carrying amount)","es":""},"answer":1.2,"tolerance":0.001},{"id":"S2","label":{"fr":"","en":"Restated gross carrying amount","es":""},"answer":2880000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Restated accumulated depreciation","es":""},"answer":1080000,"tolerance":0,"unit":"EUR"},{"id":"S4","label":{"fr":"","en":"Increase in carrying amount","es":""},"answer":300000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Restatement ratio (fair value ÷ carrying amount)","es":""},"expression":"a / (b - c)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Fair value at the revaluation date","es":""},"value":1800000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Gross carrying amount before revaluation","es":""},"value":2400000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Accumulated depreciation before revaluation","es":""},"value":900000,"unit":"EUR"}],"result":1.2},{"step":"S2","meaning":{"fr":"","en":"Restated gross carrying amount","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Gross carrying amount before revaluation","es":""},"value":2400000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Restatement ratio (fair value ÷ carrying amount)","es":""},"value":1.2}],"result":2880000,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Restated accumulated depreciation","es":""},"expression":"a * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Accumulated depreciation before revaluation","es":""},"value":900000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Restatement ratio (fair value ÷ carrying amount)","es":""},"value":1.2}],"result":1080000,"unit":"EUR"},{"step":"S4","meaning":{"fr":"","en":"Increase in carrying amount","es":""},"expression":"a - (b - c)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Fair value at the revaluation date","es":""},"value":1800000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Gross carrying amount before revaluation","es":""},"value":2400000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Accumulated depreciation before revaluation","es":""},"value":900000,"unit":"EUR"}],"result":300000,"unit":"EUR"}],"rationale":{"fr":"","en":"under the restatement approach, gross amount and accumulated depreciation are adjusted consistently so that their difference equals the revalued carrying amount; the proportional coefficient is a teaching assumption here.","es":""},"references":["REF.IAS16.35"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000108","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.ACCUMULATED_DEPRECIATION"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"HOSPITALITY","tested_point":"ELIMINATION_ENTRY","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"entry"},"references":["IAS 16 §35","IAS 16 §39"],"exercise":{"prompt":{"fr":"","en":"Case data: a hotel (excluding land) has a gross carrying amount of EUR 750,000 and accumulated depreciation of EUR 270,000. Its fair value is EUR 560,000; no earlier decrease was recognised in profit or loss. The entity applies the elimination approach. Record the single revaluation entry.","es":""},"explanation":{"fr":"","en":"Carrying amount: 750,000 − 270,000 = 480,000; increase: 560,000 − 480,000 = 80,000, recognised in OCI because no earlier decrease was taken to profit or loss (IAS 16, para. 39). Elimination: the 270,000 of accumulated depreciation is netted against the gross amount (IAS 16, para. 35). Net change in gross amount: −270,000 + 80,000 = −190,000, giving a final gross amount of 560,000. Debits 270,000 = credits 190,000 + 80,000. Main trap: crediting the increase to profit or loss, or debiting gross by 80,000 without clearing the accumulated depreciation. Rule to remember: under the elimination approach, accumulated depreciation is netted against the gross amount, then the net increase in carrying amount goes to the revaluation surplus.","es":""},"common_error":{"fr":"","en":"Crediting the increase to profit or loss, or leaving accumulated depreciation unchanged and debiting gross by 80,000.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"ACC_DEP","text":{"fr":"","en":"Accumulated depreciation","es":""}},{"id":"BUILDINGS","text":{"fr":"","en":"Buildings (gross)","es":""}},{"id":"SURPLUS","text":{"fr":"","en":"Revaluation surplus (OCI / equity)","es":""}},{"id":"REVAL_GAIN_PL","text":{"fr":"","en":"Revaluation gain (profit or loss)","es":""}}],"lines":[{"id":"L1","account":"ACC_DEP","side":"DEBIT","amount":270000},{"id":"L2","account":"BUILDINGS","side":"CREDIT","amount":190000},{"id":"L3","account":"SURPLUS","side":"CREDIT","amount":80000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000109","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.ACCUMULATED_DEPRECIATION"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"ENERGY","tested_point":"GROSS_RESTATEMENT_ENTRY","difficulty":"EXPERT","estimated_time_s":240,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"entry"},"references":["IAS 16 §35","IAS 16 §39"],"exercise":{"prompt":{"fr":"","en":"Case data: an electrical substation has a gross carrying amount of EUR 400,000 and accumulated depreciation of EUR 160,000. Its fair value is EUR 300,000; no earlier decrease in profit or loss. The entity applies the restatement approach; teaching assumption: proportionate restatement. Record the entry.","es":""},"explanation":{"fr":"","en":"Approach: 1) carrying amount 400,000 − 160,000 = 240,000; 2) coefficient 300,000 ÷ 240,000 = 1.25 (teaching assumption of proportionality); 3) restated gross 500,000 (+100,000) and restated accumulated depreciation 200,000 (+40,000); 4) net increase 300,000 − 240,000 = 60,000, taken to the revaluation surplus through OCI, with no earlier decrease in profit or loss (IAS 16, paras. 35 and 39). Check: debit 100,000 = credits 40,000 + 60,000. Main trap: restating only the gross amount, which distorts accumulated depreciation. Rule to remember: with restatement, the gross amount and accumulated depreciation are increased in the same proportion and the net increase goes to the revaluation surplus (IAS 16, paras. 35 and 39).","es":""},"common_error":{"fr":"","en":"Recording the 60,000 increase on the gross amount alone, or restating the gross amount without raising accumulated depreciation proportionally.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"PPE","text":{"fr":"","en":"Property, plant and equipment (gross)","es":""}},{"id":"ACC_DEP","text":{"fr":"","en":"Accumulated depreciation","es":""}},{"id":"SURPLUS","text":{"fr":"","en":"Revaluation surplus (OCI / equity)","es":""}},{"id":"REVAL_GAIN_PL","text":{"fr":"","en":"Revaluation gain (profit or loss)","es":""}}],"lines":[{"id":"L1","account":"PPE","side":"DEBIT","amount":100000},{"id":"L2","account":"ACC_DEP","side":"CREDIT","amount":40000},{"id":"L3","account":"SURPLUS","side":"CREDIT","amount":60000,"given":["account","side"]}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000110","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.MODEL_CONDITIONS","IAS16.REVALUATION.FAIR_VALUE_MEASUREMENT","IAS16.REVALUATION.ENTIRE_CLASS","IAS16.REVALUATION.ACCUMULATED_DEPRECIATION"],"dimension":"APPLICATION","format":"ORDERING","context":"GENERIC","tested_point":"REVALUATION_PROCESS_ORDER","difficulty":"BEGINNER","estimated_time_s":60,"lesson_id":"LS.IAS16.000009","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"how"},"references":["IAS 16 §29","IAS 16 §31","IAS 16 §35","IAS 16 §36"],"exercise":{"prompt":{"fr":"","en":"Put the steps of a revaluation in order.","es":""},"explanation":{"fr":"","en":"Reason from start to finish. First the choice: the revaluation model applies to a class (IAS 16, para. 29). Then eligibility: fair value must be reliably measurable (IAS 16, para. 31). Next, fair value is obtained for every item in the class (IAS 16, para. 36) and compared with each carrying amount. Then accumulated depreciation is dealt with, either restated or eliminated (IAS 16, para. 35). Finally, the revalued amount is depreciated over the remaining life (IAS 16, para. 31). Main trap: depreciating or comparing before accumulated depreciation has been dealt with. This order is a teaching working approach, not a sequence imposed by the standard. Rule to remember: class, reliability, fair value of all items, accumulated depreciation, then depreciation of the revalued amount.","es":""},"common_error":{"fr":"","en":"Comparing values without first fixing the class being revalued, or forgetting to deal with accumulated depreciation before depreciation restarts.","es":""},"format":"ORDERING","steps":[{"id":"S1","text":{"fr":"","en":"Check that the revaluation model has been chosen for the class","es":""}},{"id":"S2","text":{"fr":"","en":"Check that fair value can be measured reliably","es":""}},{"id":"S3","text":{"fr":"","en":"Obtain the fair value of all items in the class","es":""}},{"id":"S4","text":{"fr":"","en":"Compare each fair value with the carrying amount","es":""}},{"id":"S5","text":{"fr":"","en":"Restate or eliminate accumulated depreciation","es":""}},{"id":"S6","text":{"fr":"","en":"Depreciate the revalued amount over the remaining life","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000111","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.INCREASE"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"RETAIL","tested_point":"FIRST_INCREASE_TO_OCI","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"increase-rule"},"references":["IAS 16 §39"],"exercise":{"prompt":{"fr":"","en":"Case data: a retailer revalues its stores for the first time; one of them gains EUR 400,000 in value. No decrease has ever been recognised on this store. True or false: the EUR 400,000 increase is income in profit or loss for the year.","es":""},"explanation":{"fr":"","en":"False. Reasoning: the store has never suffered a decrease, so there is no earlier decrease in profit or loss to reverse. The 400,000 increase is therefore recognised in other comprehensive income and accumulated in the revaluation surplus; it goes to profit or loss only if it reverses a decrease on the same asset previously recognised in profit or loss, which is not the case here (IAS 16, para. 39). Main trap: seeing every revaluation gain as profit for the year. Rule to remember: a first revaluation increase goes to OCI; profit or loss is affected only to the extent of reversing an earlier decrease on the same asset.","es":""},"common_error":{"fr":"","en":"Treating a revaluation increase as a profit for the year.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000112","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.DECREASE"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"HOSPITALITY","tested_point":"DECREASE_WITHIN_SURPLUS","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"decrease-rule"},"references":["IAS 16 §40"],"exercise":{"prompt":{"fr":"","en":"Case data: a hotel has its own revaluation surplus of EUR 200,000. At the new revaluation, its fair value is EUR 150,000 below its carrying amount. What is the effect on profit or loss for the year?","es":""},"explanation":{"fr":"","en":"A decrease is charged to OCI up to the credit balance of the same asset's revaluation surplus; only the excess goes to profit or loss (IAS 16, para. 40). Here, 150,000 ≤ 200,000: all in OCI, remaining balance 50,000.","es":""},"common_error":{"fr":"","en":"Taking the whole decrease to profit or loss without comparing it with the existing revaluation surplus of the same asset.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"None: the decrease is fully charged to OCI; EUR 50,000 of surplus remains.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"An expense of EUR 150,000.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer takes the whole decrease to profit or loss, as if the hotel had no revaluation surplus. A decrease is first charged to OCI up to the credit balance of the revaluation surplus relating to the same asset (IAS 16, para. 40). Here the hotel's own surplus is 200,000: the 150,000 decrease is absorbed by it and profit or loss is not affected. Rule to remember: a decrease is charged to OCI against the surplus of the same asset; the part exceeding it goes to profit or loss (IAS 16, para. 40).","es":""}},{"id":"C","text":{"fr":"","en":"An expense of EUR 50,000.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer confuses the remaining surplus (50,000) with an excess decrease to be expensed. The amount to take to profit or loss is the decrease minus the available surplus: 150,000 − 200,000 is negative, so nil (IAS 16, para. 40). The 50,000 is what remains of the surplus after the charge and stays in equity. Rule to remember: a decrease is first set against the revaluation surplus of the same asset, any excess going to profit or loss (IAS 16, para. 40).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000113","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.DECREASE"],"dimension":"CALCULATION","format":"FILL_BLANK","context":"AGRICULTURE","tested_point":"DECREASE_EXCEEDS_SURPLUS","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"decrease-rule"},"references":["IAS 16 §40"],"exercise":{"prompt":{"fr":"","en":"Complete the analysis of the decrease.","es":""},"explanation":{"fr":"","en":"Approach: 1) identify the credit balance of the surplus of the same asset: 35,000; 2) charge it to OCI: 35,000; 3) take the excess to profit or loss: 100,000 − 35,000 = 65,000; 4) the surplus, now cleared, is nil. The decrease is charged to OCI up to the credit balance of the surplus (IAS 16, para. 40); the 65,000 excess goes to profit or loss. A revaluation surplus does not become a debit balance. Main trap: charging the whole decrease to OCI. Rule to remember: OCI up to the surplus of the same asset, the rest to profit or loss.","es":""},"common_error":{"fr":"","en":"Taking the whole 100,000 decrease to profit or loss without using the available surplus, or all to OCI and leaving a debit balance in the surplus.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"A farm shed has its own revaluation surplus of EUR 35,000. Its revaluation shows a decrease of EUR 100,000. Amount charged to OCI: EUR {{oci}}; amount in profit or loss: EUR {{pl}}; after the transaction, the shed's revaluation surplus is {{after}}.","es":""},"blanks":[{"id":"oci","mode":"NUMBER","answer":35000,"tolerance":0},{"id":"pl","mode":"NUMBER","answer":65000,"tolerance":0},{"id":"after","mode":"CHOICE","choices":[{"id":"NIL","text":{"fr":"","en":"nil","es":""}},{"id":"DEBIT","text":{"fr":"","en":"a debit of EUR 65,000","es":""}},{"id":"UNCHANGED","text":{"fr":"","en":"unchanged at EUR 35,000","es":""}}],"answer":"NIL"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000114","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.INCREASE","IAS16.REVALUATION.DECREASE"],"dimension":"CALCULATION","format":"CALCULATION","context":"LOGISTICS","tested_point":"SUCCESSIVE_REVALUATIONS_LAND","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"example"},"references":["IAS 16 §39","IAS 16 §40"],"exercise":{"prompt":{"fr":"","en":"A logistics plot of land (not depreciated) is measured under the revaluation model. Follow its three successive revaluations and calculate their effects.","es":""},"explanation":{"fr":"","en":"N+1: 100,000 increase to OCI, surplus of 100,000 (IAS 16, para. 39). N+3: 200,000 decrease; 100,000 charged to OCI (surplus cleared), 100,000 to profit or loss (IAS 16, para. 40). N+5: 150,000 increase; 100,000 to profit or loss to reverse the earlier decrease, 50,000 to OCI (IAS 16, para. 39). Cumulative profit or loss: −100,000 + 100,000 = 0; final surplus 50,000. Main trap: taking the whole N+5 increase to OCI and forgetting the N+3 decrease taken to profit or loss. Rule to remember: an increase first reverses, in profit or loss, earlier decreases on the same asset that were taken to profit or loss; the excess goes to OCI.","es":""},"common_error":{"fr":"","en":"In N+5, putting the whole increase in OCI and forgetting the N+3 decrease recognised in profit or loss.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Acquisition cost (N)","es":""},"value":"800000","unit":"EUR"},{"label":{"fr":"","en":"Fair value at 31/12/N+1","es":""},"value":"900000","unit":"EUR"},{"label":{"fr":"","en":"Fair value at 31/12/N+3","es":""},"value":"700000","unit":"EUR"},{"label":{"fr":"","en":"Fair value at 31/12/N+5","es":""},"value":"850000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Expense in profit or loss in N+3","es":""},"answer":100000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Income in profit or loss in N+5","es":""},"answer":100000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Revaluation surplus at 31/12/N+5","es":""},"answer":50000,"tolerance":0,"unit":"EUR"},{"id":"S4","label":{"fr":"","en":"Cumulative effect on profit or loss from N+1 to N+5","es":""},"answer":0,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000115","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.INCREASE"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"RETAIL","tested_point":"INCREASE_REVERSING_PL_DECREASE","difficulty":"INTERMEDIATE","estimated_time_s":150,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"increase-rule"},"references":["IAS 16 §39"],"exercise":{"prompt":{"fr":"","en":"Case data: the land of a shopping centre suffered a revaluation decrease of EUR 40,000 in N, recognised in profit or loss for lack of a revaluation surplus. In N+2, its fair value rises by EUR 100,000. Record the N+2 entry.","es":""},"explanation":{"fr":"","en":"Approach: 1) the total increase is 100,000, debited to land; 2) the land suffered a 40,000 decrease in N taken to profit or loss: the increase reverses it first, giving a 40,000 gain; 3) the excess, 100,000 − 40,000 = 60,000, goes to OCI as revaluation surplus (IAS 16, para. 39). Check: debit 100,000 = credits 40,000 + 60,000. Main trap: taking everything to the revaluation surplus. Rule to remember: an increase reverses in profit or loss, up to that amount, an earlier decrease on the same asset taken to profit or loss; the rest goes to OCI.","es":""},"common_error":{"fr":"","en":"Taking the whole 100,000 increase to the revaluation surplus and forgetting the 40,000 decrease previously taken to profit or loss.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"LAND","text":{"fr":"","en":"Land","es":""}},{"id":"REVAL_GAIN_PL","text":{"fr":"","en":"Revaluation gain (profit or loss)","es":""}},{"id":"SURPLUS","text":{"fr":"","en":"Revaluation surplus (OCI / equity)","es":""}},{"id":"RETAINED","text":{"fr":"","en":"Retained earnings","es":""}}],"lines":[{"id":"L1","account":"LAND","side":"DEBIT","amount":100000,"given":["account","side"]},{"id":"L2","account":"REVAL_GAIN_PL","side":"CREDIT","amount":40000},{"id":"L3","account":"SURPLUS","side":"CREDIT","amount":60000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000116","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.DECREASE"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"HEALTHCARE","tested_point":"DECREASE_ENTRY_ELIMINATION","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"entry"},"references":["IAS 16 §35","IAS 16 §40"],"exercise":{"prompt":{"fr":"","en":"Case data: a clinic (building) is carried at a gross amount of EUR 1,200,000 with accumulated depreciation of EUR 100,000 since its last revaluation; its own revaluation surplus is EUR 70,000. Its fair value is now EUR 950,000. The entity applies the elimination approach. Record the single entry.","es":""},"explanation":{"fr":"","en":"Approach: 1) carrying amount 1,200,000 − 100,000 = 1,100,000; decrease of 150,000 down to 950,000. 2) Charge to OCI up to the surplus of the same asset: 70,000; excess to profit or loss: 80,000 (IAS 16, para. 40). 3) Elimination of the 100,000 of accumulated depreciation against gross (IAS 16, para. 35). 4) Credit to gross: 100,000 + 150,000 = 250,000, final gross 950,000. Debits 100,000 + 70,000 + 80,000 = credit 250,000. Main trap: charging everything to OCI and leaving a debit balance in the surplus. Rule to remember: the decrease is first absorbed by the surplus of the same asset, the rest goes to profit or loss, and elimination nets accumulated depreciation against gross.","es":""},"common_error":{"fr":"","en":"Charging the whole decrease to OCI, making the revaluation surplus a debit balance.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"ACC_DEP","text":{"fr":"","en":"Accumulated depreciation","es":""}},{"id":"SURPLUS","text":{"fr":"","en":"Revaluation surplus (OCI / equity)","es":""}},{"id":"REVAL_LOSS_PL","text":{"fr":"","en":"Revaluation loss (profit or loss)","es":""}},{"id":"BUILDINGS","text":{"fr":"","en":"Buildings (gross)","es":""}},{"id":"RETAINED","text":{"fr":"","en":"Retained earnings","es":""}}],"lines":[{"id":"L1","account":"ACC_DEP","side":"DEBIT","amount":100000},{"id":"L2","account":"SURPLUS","side":"DEBIT","amount":70000},{"id":"L3","account":"REVAL_LOSS_PL","side":"DEBIT","amount":80000},{"id":"L4","account":"BUILDINGS","side":"CREDIT","amount":250000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000117","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.SURPLUS_TRANSFER"],"dimension":"CALCULATION","format":"CALCULATION","context":"MANUFACTURING","tested_point":"ANNUAL_TRANSFER_EXCESS_DEPRECIATION","difficulty":"INTERMEDIATE","estimated_time_s":150,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"surplus-transfer"},"references":["IAS 16 §41"],"exercise":{"prompt":{"fr":"","en":"Case data: an industrial press bought for EUR 900,000 (10 years, straight-line, zero residual value) is revalued at EUR 720,000 after 4 years; remaining life unchanged (6 years). The entity transfers the surplus to retained earnings each year as the asset is used. Calculate.","es":""},"explanation":{"fr":"","en":"Carrying amount after 4 years: 900,000 − 4 × 90,000 = 540,000; surplus: 720,000 − 540,000 = 180,000. Depreciation on the revalued amount: 720,000 ÷ 6 = 120,000; depreciation on original cost: 900,000 ÷ 10 = 90,000; annual transfer: 120,000 − 90,000 = 30,000, directly to retained earnings (IAS 16, para. 41). Check: 6 × 30,000 = 180,000. Main trap: transferring the whole depreciation charge instead of the excess depreciation only. Rule to remember: the annual transfer is the difference between depreciation on the revalued amount and on original cost, and it does not go through profit or loss.","es":""},"common_error":{"fr":"","en":"Transferring the full charge (120,000) instead of only the extra depreciation.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Original cost","es":""},"value":"900000","unit":"EUR"},{"label":{"fr":"","en":"Total useful life","es":""},"value":"10","unit":"YEARS"},{"label":{"fr":"","en":"Fair value after 4 years","es":""},"value":"720000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Revaluation surplus recognised","es":""},"answer":180000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Annual depreciation on the revalued amount","es":""},"answer":120000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Annual depreciation on original cost","es":""},"answer":90000,"tolerance":0,"unit":"EUR"},{"id":"S4","label":{"fr":"","en":"Annual transfer to retained earnings","es":""},"answer":30000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S2","meaning":{"fr":"","en":"Annual depreciation on the revalued amount","es":""},"expression":"a / 6","variables":[{"symbol":"a","meaning":{"fr":"","en":"Fair value after 4 years","es":""},"value":720000,"unit":"EUR"}],"result":120000,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Annual depreciation on original cost","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Original cost","es":""},"value":900000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Total useful life","es":""},"value":10,"unit":"YEARS"}],"result":90000,"unit":"EUR"},{"step":"S4","meaning":{"fr":"","en":"Annual transfer to retained earnings","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Annual depreciation on the revalued amount","es":""},"value":120000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Annual depreciation on original cost","es":""},"value":90000,"unit":"EUR"}],"result":30000,"unit":"EUR"}],"rationale":{"fr":"","en":"the annual transfer is the difference between depreciation on the revalued amount and on original cost, and it does not go through profit or loss.","es":""},"references":["REF.IAS16.41"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000118","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.SURPLUS_TRANSFER"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"HOSPITALITY","tested_point":"TRANSFER_ON_DERECOGNITION","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"surplus-transfer"},"references":["IAS 16 §41"],"exercise":{"prompt":{"fr":"","en":"Case data: a revalued hotel is sold; the gain on disposal has already been recognised. EUR 220,000 of revaluation surplus relating to this hotel remains, which the entity has chosen to transfer on disposal. Record the transfer entry.","es":""},"explanation":{"fr":"","en":"Approach: 1) the hotel is sold and derecognised, and the gain on disposal has already been recognised; 2) a revaluation surplus of 220,000 relating to this hotel remains; 3) the entity chose to transfer it on disposal: debit the surplus, credit retained earnings, for 220,000. The transfer is made directly to retained earnings, without going through profit or loss (IAS 16, para. 41): it does not increase the gain on disposal. Main trap: recycling the surplus into profit or loss as is done for some other OCI items. Rule to remember: on disposal, the revaluation surplus may be transferred to retained earnings, but never passed back through profit or loss.","es":""},"common_error":{"fr":"","en":"Crediting the gain on disposal, as if the surplus were recycled through profit or loss.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"SURPLUS","text":{"fr":"","en":"Revaluation surplus (OCI / equity)","es":""}},{"id":"RETAINED","text":{"fr":"","en":"Retained earnings","es":""}},{"id":"GAIN_DISPOSAL","text":{"fr":"","en":"Gain on disposal (profit or loss)","es":""}},{"id":"BUILDINGS","text":{"fr":"","en":"Buildings (gross)","es":""}}],"lines":[{"id":"L1","account":"SURPLUS","side":"DEBIT","amount":220000},{"id":"L2","account":"RETAINED","side":"CREDIT","amount":220000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000119","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.SURPLUS_TRANSFER","IAS16.REVALUATION.INCREASE","IAS16.REVALUATION.DECREASE"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"TELECOM","tested_point":"REVALUATION_MEMO_ERRORS","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"pitfalls"},"references":["IAS 16 §39","IAS 16 §40","IAS 16 §41"],"exercise":{"prompt":{"fr":"","en":"A telecoms operator revalues its technical buildings. Spot the errors in a staff member's memo.","es":""},"explanation":{"fr":"","en":"Steps: for each sentence, identify the mechanism concerned: transfer of the revaluation surplus, allocation of a decrease, reversal of a past decrease. The revaluation surplus may be transferred directly to retained earnings, without going through profit or loss, on derecognition or as the asset is used (IAS 16, para. 41); the annual transfer in the case corresponds to the additional depreciation due to the revaluation. A decrease is charged to OCI against the surplus of the same asset; otherwise it goes to profit or loss (IAS 16, para. 40). An increase that reverses a past decrease recognised in profit or loss goes first to profit or loss to that extent (IAS 16, para. 39). Trap: recycling the surplus to profit or loss on sale, or offsetting one asset's decrease against another asset's surplus. Rule to remember: the revaluation surplus is transferred to retained earnings without going through profit or loss (IAS 16, para. 41); a decrease is set against the surplus of the same asset (IAS 16, para. 40). Effect on the financial statements: the transfer is a movement between two components of equity and does not increase the gain on disposal.","es":""},"common_error":{"fr":"","en":"Recycling the revaluation surplus through profit or loss on sale, or offsetting one asset's decrease against another asset's surplus.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"'On the sale of the Lyon building, its revaluation surplus of 90,000 will be added to the gain on disposal.'","es":""},"erroneous":true,"correction":{"fr":"","en":"The surplus may be transferred directly to retained earnings, without passing through profit or loss (IAS 16, para. 41).","es":""}},{"id":"S2","text":{"fr":"","en":"'The annual transfer equals the full depreciation charge on the revalued amount.'","es":""},"erroneous":true,"correction":{"fr":"","en":"It is the difference between depreciation on the revalued amount and depreciation on original cost (IAS 16, para. 41).","es":""}},{"id":"S3","text":{"fr":"","en":"'The transfer is a movement between two equity reserves.'","es":""},"erroneous":false},{"id":"S4","text":{"fr":"","en":"'The decrease on the Lille building will be charged against the Lyon building's revaluation surplus.'","es":""},"erroneous":true,"correction":{"fr":"","en":"A charge to OCI is possible only against the surplus relating to the same asset; otherwise the decrease goes to profit or loss (IAS 16, para. 40).","es":""}},{"id":"S5","text":{"fr":"","en":"'The increase on the Nantes building, which reverses a decrease recognised in profit or loss two years ago, will first go to profit or loss to that extent.'","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000120","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.DEFERRED_TAX"],"dimension":"PROFESSIONAL_JUDGMENT","format":"SINGLE_CHOICE","context":"REAL_ESTATE","tested_point":"TAX_EFFECTS_IAS12","difficulty":"EXPERT","estimated_time_s":90,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"deferred-tax"},"references":["IAS 16 §42"],"exercise":{"prompt":{"fr":"","en":"Case data: a property company revalues its operating offices by +EUR 2,000,000. Under local tax law, the tax base of the buildings remains the original depreciated cost. How should it approach the tax consequences of the revaluation?","es":""},"explanation":{"fr":"","en":"The effects of a revaluation on income taxes, current and deferred, are recognised and disclosed under IAS 12 (IAS 16, para. 42). Here, the revaluation increases the carrying amount by 2,000,000 without changing the tax base: this additional difference is what the IAS 12 analysis will have to deal with.","es":""},"common_error":{"fr":"","en":"Reducing the tax effect of a revaluation to the current tax of the year, forgetting deferred tax.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"By applying IAS 12 to the effects of the revaluation on current and deferred tax.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"No analysis: the revaluation generates no tax payable this year.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer retains only the current tax of the year and concludes there is nothing to analyse. IAS 16 refers to the effects of revaluation on both current and deferred tax, to be recognised and presented under IAS 12 (IAS 16, para. 42). In the case, the carrying amount rises by 2,000,000 while the tax base stays at the original amortised cost: this difference falls within the IAS 12 analysis, even with no tax payable this year. Rule to remember: the absence of current tax does not rule out a deferred tax effect to be handled under IAS 12.","es":""}},{"id":"C","text":{"fr":"","en":"By applying a tax treatment defined by IAS 16 itself.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer looks in IAS 16 for a tax treatment that is not there: the standard does not define it, and refers to IAS 12 for recognising and presenting the current and deferred tax effects of revaluation (IAS 16, para. 42). Here the analysis will deal with the 2,000,000 difference between the revalued carrying amount and the unchanged tax base, using IAS 12 rules. Rule to remember: IAS 16 refers, IAS 12 deals with the tax.","es":""}},{"id":"D","text":{"fr":"","en":"By following IFRS 13, since the revaluation is based on fair value.","es":""},"correct":false,"feedback":{"fr":"","en":"IFRS 13 is used to measure the fair value on which the revaluation rests, not to deal with its tax consequences. For current and deferred tax, IAS 16 refers to IAS 12 (IAS 16, para. 42). In the case, IFRS 13 helps establish the 2,000,000 increase, but the resulting tax effect, with the tax base remaining the original amortised cost, is dealt with under IAS 12. Rule to remember: IFRS 13 measures fair value, IAS 12 deals with tax.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000121","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.DEFERRED_TAX"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"MANUFACTURING","tested_point":"TAX_ANALYSIS_NOT_ONLY_CURRENT","difficulty":"INTERMEDIATE","estimated_time_s":30,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"deferred-tax"},"references":["IAS 16 §42"],"exercise":{"prompt":{"fr":"","en":"True or false: IAS 16 limits the tax analysis of a revaluation to current tax for the year.","es":""},"explanation":{"fr":"","en":"False. Reasoning: we need to determine whether IAS 16 limits the tax analysis to current tax. The standard in fact refers to the effects of revaluation on both current and deferred tax, to be recognised and presented under IAS 12 (IAS 16, para. 42). Main trap: thinking that a revaluation, which does not always trigger tax payable, has no tax consequence to account for. Rule to remember: the tax effects of a revaluation, current and deferred, fall under IAS 12.","es":""},"common_error":{"fr":"","en":"Looking only at the tax payable for the year and forgetting the deferred tax that revaluation can create.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000122","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.INCREASE","IAS16.REVALUATION.DECREASE","IAS16.REVALUATION.SURPLUS_TRANSFER"],"dimension":"ANALYSIS","format":"MINI_CASE","context":"RETAIL","tested_point":"MULTI_ASSET_REVALUATION_EFFECTS","difficulty":"EXPERT","estimated_time_s":540,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"judgment"},"references":["IAS 16 §39","IAS 16 §40","IAS 16 §41"],"exercise":{"prompt":{"fr":"","en":"Analyse Maison Durand's revaluations at 31 December N.","es":""},"explanation":{"fr":"","en":"Approach, asset by asset. Building A: decrease of 2,000,000 − 1,750,000 = 250,000, lower than its own surplus of 300,000: all to OCI, no effect on profit or loss, remaining surplus 50,000 (IAS 16, para. 40). Land B: increase of 100,000; the 60,000 decrease taken to profit or loss in N−2 is reversed first (60,000 gain), the excess of 40,000 goes to OCI (IAS 16, para. 39). Net effect on N profit or loss: gain of 60,000; in OCI: −250,000 + 40,000 = −210,000. On the sale of A, the 50,000 balance may be transferred directly to retained earnings (IAS 16, para. 41). Main trap: offsetting assets against each other. Rule to remember: each asset follows its own revaluation surplus history.","es":""},"common_error":{"fr":"","en":"Treating the assets together, for example offsetting building A's decrease against land B's increase, instead of applying to each its own history of surplus and earlier decreases.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Maison Durand, a retail chain, applies the revaluation model to its 'buildings' and 'land' classes. It keeps an asset-by-asset register (case data). At 31 December N, two assets show a significant change.","es":""},"exhibits":[{"title":{"fr":"","en":"Asset register (case data)","es":""},"body":{"fr":"","en":"Building A (head office): carrying amount 2,000,000; own revaluation surplus 300,000; fair value at 31/12/N 1,750,000. Land B (not depreciated): carrying amount 900,000; no surplus; decrease of 60,000 recognised in profit or loss in N−2; fair value at 31/12/N 1,000,000.","es":""}}],"parts":[{"prompt":{"fr":"","en":"Building A: allocate the change.","es":""},"explanation":{"fr":"","en":"Approach: compare the decrease with the revaluation surplus of the asset itself. Decrease of 250,000, lower than the asset's own surplus of 300,000: charged entirely to OCI, remaining surplus 50,000 (IAS 16, para. 40). Trap: taking the decrease to profit or loss without looking at the asset's surplus. Rule to remember: a decrease is first charged to OCI against the surplus of the same asset, any excess goes to profit or loss (IAS 16, para. 40).","es":""},"common_error":{"fr":"","en":"Taking the decrease to profit or loss without looking at the asset's surplus: it is first charged to OCI against this building's revaluation surplus.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Decrease","es":""},"value":"2000000 − 1750000","unit":"TEXT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Part in OCI","es":""},"answer":250000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Part in profit or loss","es":""},"answer":0,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Remaining revaluation surplus","es":""},"answer":50000,"tolerance":0,"unit":"EUR"}],"id":"P1","dimension":"CALCULATION"},{"prompt":{"fr":"","en":"Land B: allocate the change.","es":""},"explanation":{"fr":"","en":"Approach: check whether the asset suffered an earlier decrease recognised in profit or loss. The increase of 100,000 first reverses the decrease of 60,000 recognised in profit or loss; the excess of 40,000 goes to OCI (IAS 16, para. 39). Trap: taking everything to OCI or everything to profit or loss. Rule to remember: an increase goes to profit or loss up to the earlier decrease of the same asset recognised in profit or loss, the rest to OCI (IAS 16, para. 39).","es":""},"common_error":{"fr":"","en":"Taking the whole increase to OCI: it first reverses in profit or loss the previous decrease on the same land.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Increase","es":""},"value":"1000000 − 900000","unit":"TEXT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Part in profit or loss","es":""},"answer":60000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Part in OCI","es":""},"answer":40000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION"},{"prompt":{"fr":"","en":"What is the net effect of these two revaluations on profit or loss for N?","es":""},"explanation":{"fr":"","en":"Approach: add up the effects on profit or loss asset by asset. A: nil in profit or loss (IAS 16, para. 40); B: +60,000 in profit or loss (IAS 16, para. 39). Net effect: income of 60,000; in OCI: −250,000 + 40,000 = −210,000. Rule to remember: profit or loss for N includes only the reversal of B's earlier decrease, the other changes go to OCI (IAS 16, paras. 39 and 40).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Income of 60,000","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Expense of 150,000 (−250,000 + 100,000)","es":""},"correct":false,"feedback":{"fr":"","en":"This answer adds A's decrease and B's increase as if everything went to profit or loss. But A's decrease, 250,000, is absorbed in OCI by its own surplus (IAS 16, para. 40), and B's increase goes to profit or loss only for 60,000, the excess of 40,000 going to OCI (IAS 16, para. 39). Rule to remember: the effect on profit or loss is calculated asset by asset, without offsetting changes (IAS 16, paras. 39 and 40).","es":""}},{"id":"C","text":{"fr":"","en":"No effect","es":""},"correct":false,"feedback":{"fr":"","en":"This answer ignores the reversal: B's earlier decrease, recognised in profit or loss, is reversed in profit or loss by the increase up to 60,000 (IAS 16, para. 39). Profit or loss for N therefore includes income of 60,000, not a nil effect. Rule to remember: the reversal of an earlier decrease recognised in profit or loss is income of the period (IAS 16, para. 39).","es":""}}],"id":"P3","dimension":"ANALYSIS"},{"prompt":{"fr":"","en":"If Maison Durand sells building A in N+1, the balance of its surplus (50,000) may be transferred to retained earnings without passing through profit or loss.","es":""},"explanation":{"fr":"","en":"True. Approach: find what happens to the surplus on derecognition. On derecognition, the surplus may be transferred directly to retained earnings, without going through profit or loss (IAS 16, para. 41). Trap: recycling the surplus to profit or loss. Rule to remember: on sale, the surplus is transferred directly to retained earnings (IAS 16, para. 41).","es":""},"common_error":{"fr":"","en":"Recycling the surplus to profit or loss on sale: it is transferred directly to retained earnings.","es":""},"format":"TRUE_FALSE","answer":true,"id":"P4","dimension":"RULE_KNOWLEDGE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000123","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.INCREASE","IAS16.REVALUATION.DECREASE","IAS16.REVALUATION.SURPLUS_TRANSFER"],"dimension":"RECOGNITION","format":"MATCHING","context":"GENERIC","tested_point":"REVALUATION_DESTINATIONS","difficulty":"BEGINNER","estimated_time_s":75,"lesson_id":"LS.IAS16.000010","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"understand"},"references":["IAS 16 §39","IAS 16 §40","IAS 16 §41"],"exercise":{"prompt":{"fr":"","en":"Match each situation with the accounting destination of the amount concerned.","es":""},"explanation":{"fr":"","en":"Approach: for each situation, ask what history the same asset already has. L1, first increase with no earlier decrease: OCI. L2, increase reversing a decrease taken to profit or loss: profit or loss, up to that amount (IAS 16, para. 39). L3, decrease covered by the same asset's surplus: OCI. L4, decrease with no surplus available: profit or loss (IAS 16, para. 40). L5, surplus remaining on sale: direct transfer to retained earnings, without going through profit or loss (IAS 16, para. 41). Main trap: applying a fixed direction (increase to OCI, decrease to profit or loss). Rule to remember: the destination depends on the history of the same asset, not only on the direction of the change.","es":""},"common_error":{"fr":"","en":"Matching every increase to OCI and every decrease to profit or loss, without looking at the history of the same asset (available surplus, earlier decrease taken to profit or loss).","es":""},"format":"MATCHING","left":[{"id":"L1","text":{"fr":"","en":"Increase on an asset with no earlier decrease","es":""}},{"id":"L2","text":{"fr":"","en":"Increase reversing a decrease of the same asset recognised in profit or loss","es":""}},{"id":"L3","text":{"fr":"","en":"Decrease covered by the same asset's revaluation surplus","es":""}},{"id":"L4","text":{"fr":"","en":"Decrease on an asset with no revaluation surplus","es":""}},{"id":"L5","text":{"fr":"","en":"Surplus remaining when the asset is sold","es":""}}],"right":[{"id":"R1","text":{"fr":"","en":"Other comprehensive income (revaluation surplus)","es":""}},{"id":"R2","text":{"fr":"","en":"Profit or loss","es":""}},{"id":"R3","text":{"fr":"","en":"Direct transfer to retained earnings","es":""}}],"pairs":[{"left":"L1","right":"R1"},{"left":"L2","right":"R2"},{"left":"L3","right":"R1"},{"left":"L4","right":"R2"},{"left":"L5","right":"R3"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000124","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"SIGNIFICANCE_NO_FIXED_THRESHOLD","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"components-rule"},"references":["IAS 16 §43"],"exercise":{"prompt":{"fr":"","en":"True or false: IAS 16 sets a numerical threshold (for example 10% of total cost) above which a part must be depreciated separately.","es":""},"explanation":{"fr":"","en":"False. Reasoning: the standard requires each part whose cost is significant in relation to the total cost to be depreciated separately (IAS 16, para. 43), but it does not quantify \"significant\". The assessment is therefore a matter of judgement, preferably framed by a documented internal policy; a percentage used in a case is a case assumption, not an IAS 16 rule. Main trap: taking an illustrative threshold for a general rule. Rule to remember: IAS 16 requires separate depreciation of significant parts with no numerical threshold; the threshold is a matter of the entity's judgement.","es":""},"common_error":{"fr":"","en":"Believing the standard imposes a percentage (10%, 5%…) for deciding whether to separate a part.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000125","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"RECOGNITION","format":"MULTIPLE_CHOICE","context":"HEALTHCARE","tested_point":"IDENTIFY_SIGNIFICANT_PARTS","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"components-rule"},"references":["IAS 16 §43","IAS 16 §45","IAS 16 §46","IAS 16 §47"],"exercise":{"prompt":{"fr":"","en":"Case data: a private hospital builds a EUR 20,000,000 building: structure 13,000,000 (50 years), facade 2,000,000 (30 years), heating-ventilation-air conditioning 3,000,000 (15 years), lifts 1,200,000 (20 years), various small equipment 800,000. Case assumption: the entity's policy treats any part of at least 5% of cost as significant. Which statements are correct?","es":""},"explanation":{"fr":"","en":"Significant parts (here ≥ 5% under the case policy: structure, facade, HVAC, lifts): separate depreciation (IAS 16, para. 43). Grouping only with identical life and method (IAS 16, para. 45). Remainder depreciated, by approximation if needed (IAS 16, para. 46). Optional separation of an insignificant part (IAS 16, para. 47).","es":""},"common_error":{"fr":"","en":"Believing that a non-significant part is not depreciated, or grouping significant parts with different lives.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Heating-ventilation-air conditioning is depreciated separately.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The small equipment, being insignificant, is not depreciated.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer confuses a \"non-significant part\" with a \"part that is not depreciated\". The small equipment (800,000, i.e. 4% of cost, below the 5% threshold in the case's policy) is not treated separately, but it forms a remainder that is also depreciated, if necessary using approximation techniques that reflect the pattern of consumption or the useful life (IAS 16, para. 46). Rule to remember: depreciating some parts separately means the remainder of the asset must also be depreciated (IAS 16, para. 46).","es":""}},{"id":"C","text":{"fr":"","en":"The facade and heating-ventilation-air conditioning may be grouped.","es":""},"correct":false,"feedback":{"fr":"","en":"Significant parts may be grouped only if they have the same useful life and the same depreciation method (IAS 16, para. 45). The facade (30 years) and the HVAC (15 years) have different lives: grouping them would depreciate them at a pace that matches neither. Rule to remember: parts with the same useful life and the same depreciation method are grouped (IAS 16, para. 45).","es":""}},{"id":"D","text":{"fr":"","en":"The small equipment forms a remainder that is depreciated, using a faithful approximation technique if needed.","es":""},"correct":true},{"id":"E","text":{"fr":"","en":"The entity may choose to track an insignificant item separately, for example a generator.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000126","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"CALCULATION","format":"CALCULATION","context":"LOGISTICS","tested_point":"COMPONENT_CHARGE_TRUCK","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"numeric-example"},"references":["IAS 16 §43","IAS 16 §44"],"exercise":{"prompt":{"fr":"","en":"Case data: a haulier buys a refrigerated truck for EUR 180,000, broken down into three significant components. Straight-line method, zero residual values (case assumptions). Calculate the annual charge.","es":""},"explanation":{"fr":"","en":"Approach: 1) each significant component is depreciated separately over its own life (IAS 16, paras. 43 and 44); 2) chassis and cab: 126,000 ÷ 9 = 14,000; engine: 42,000 ÷ 6 = 7,000; refrigeration unit: 12,000 ÷ 4 = 3,000; 3) total: 24,000. Depreciating the whole truck over 9 years would give only 180,000 ÷ 9 = 20,000. Main trap: using the longest component's life for the whole asset. Rule to remember: allocate the cost among the significant parts and depreciate each over its own useful life.","es":""},"common_error":{"fr":"","en":"Depreciating the truck as a whole over the main component's life (9 years), which understates the annual charge.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Chassis and cab (9 years)","es":""},"value":"126000","unit":"EUR"},{"label":{"fr":"","en":"Engine (6 years)","es":""},"value":"42000","unit":"EUR"},{"label":{"fr":"","en":"Refrigeration unit (4 years)","es":""},"value":"12000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Chassis and cab charge","es":""},"answer":14000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Engine charge","es":""},"answer":7000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Refrigeration unit charge","es":""},"answer":3000,"tolerance":0,"unit":"EUR"},{"id":"S4","label":{"fr":"","en":"Total charge","es":""},"answer":24000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Chassis and cab charge","es":""},"expression":"a / 9","variables":[{"symbol":"a","meaning":{"fr":"","en":"Chassis and cab (9 years)","es":""},"value":126000,"unit":"EUR"}],"result":14000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Engine charge","es":""},"expression":"a / 6","variables":[{"symbol":"a","meaning":{"fr":"","en":"Engine (6 years)","es":""},"value":42000,"unit":"EUR"}],"result":7000,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Refrigeration unit charge","es":""},"expression":"a / 4","variables":[{"symbol":"a","meaning":{"fr":"","en":"Refrigeration unit (4 years)","es":""},"value":12000,"unit":"EUR"}],"result":3000,"unit":"EUR"}],"rationale":{"fr":"","en":"allocate the cost among the significant parts and depreciate each over its own useful life.","es":""},"references":["REF.IAS16.43","REF.IAS16.44"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000127","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"CALCULATION","format":"FILL_BLANK","context":"TRANSPORT","tested_point":"SINGLE_LIFE_UNDERSTATEMENT","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"numeric-example"},"references":["IAS 16 §43","IAS 16 §44"],"exercise":{"prompt":{"fr":"","en":"Complete the calculation.","es":""},"explanation":{"fr":"","en":"Approach: 1) the body (30 years) and the bogies (10 years) are depreciated separately (IAS 16, paras. 43 and 44); 2) body: 9,000,000 ÷ 30 = 300,000; bogies: 3,000,000 ÷ 10 = 300,000; total 600,000; 3) overall: 12,000,000 ÷ 30 = 400,000, i.e. 200,000 less each year while the bogies are not yet fully depreciated. Main trap: applying the life of the longest part to the whole asset. Rule to remember: a significant part with a shorter life must be depreciated over its own life, otherwise the charge is understated.","es":""},"common_error":{"fr":"","en":"Depreciating the train set as a whole over the body's life (30 years) and ignoring the shorter life of the bogies.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"A train set costs EUR 12,000,000: body 9,000,000 (30 years) and bogies 3,000,000 (10 years), straight-line, zero residual values. Annual component-based charge: EUR {{total}}. Depreciating the whole over 30 years would understate the annual charge by EUR {{gap}}.","es":""},"blanks":[{"id":"total","mode":"NUMBER","answer":600000,"tolerance":0},{"id":"gap","mode":"NUMBER","answer":200000,"tolerance":0}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000128","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"MANUFACTURING","tested_point":"GROUPING_REQUIRES_SAME_METHOD","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"components-rule"},"references":["IAS 16 §45"],"exercise":{"prompt":{"fr":"","en":"Case data: in an extrusion line, the main motor and the extrusion screw are two significant parts with the same useful life (8 years). The motor is depreciated on a straight-line basis; the screw, whose wear follows output, on a units-of-production basis. May they be grouped to calculate the charge?","es":""},"explanation":{"fr":"","en":"Significant parts may be grouped if they have the same useful life **and** the same depreciation method (IAS 16, para. 45). Here the methods differ: each part keeps its own charge.","es":""},"common_error":{"fr":"","en":"Grouping parts on useful life alone, without comparing their depreciation method.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Yes, the identical life is enough.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer looks at useful life only. Grouping significant parts requires the same useful life and the same depreciation method (IAS 16, para. 45). Here the motor is depreciated on a straight-line basis and the screw on units of production: their charges follow different patterns, so each keeps its own charge. Rule to remember: identical lives are not enough, the method must also be the same.","es":""}},{"id":"B","text":{"fr":"","en":"No, because their depreciation methods differ.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Yes, if their combined cost is significant.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer confuses significance with grouping. A significant cost justifies depreciating these parts separately from the rest of the asset (IAS 16, para. 43), but it does not allow two parts with different depreciation methods to be grouped: grouping requires the same life and the same method (IAS 16, para. 45). Here straight-line and units of production differ. Rule to remember: significance requires separation, it does not authorise grouping.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000129","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"SHIPPING","tested_point":"COMPONENT_REGISTER_REVIEW","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"pitfalls"},"references":["IAS 16 §43","IAS 16 §44","IAS 16 §45","IAS 16 §46","IAS 16 §47"],"exercise":{"prompt":{"fr":"","en":"You are reviewing the component schedule for a container ship acquired for EUR 40,000,000. Spot the errors.","es":""},"explanation":{"fr":"","en":"Steps: for each sentence, check whether a part is significant, whether parts may be grouped and whether the whole cost is allocated. Parts whose cost is significant are depreciated separately (IAS 16, paras. 43 and 44); parts with the same life and method may be grouped (IAS 16, para. 45); the remainder is depreciated, using approximation techniques if necessary (IAS 16, para. 46); the entity may depreciate separately a part that is not significant (IAS 16, para. 47); the initial cost is allocated among the parts (IAS 16, para. 44). Trap: leaving the small items out of depreciation because they are not significant, or leaving an allocation difference unassigned. Rule to remember: the whole cost is allocated among the significant parts and the remainder, which is also depreciated (IAS 16, paras. 44 and 46). Effect on the financial statements: an unassigned difference or undepreciated items would distort the charge and the carrying amount.","es":""},"common_error":{"fr":"","en":"Leaving the small equipment out of depreciation because it is not significant, or leaving a cost allocation difference unassigned.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The hull and the two main engines (8,000,000 in total, 12-year life) are depreciated together over 25 years, the life of the hull.","es":""},"erroneous":true,"correction":{"fr":"","en":"The engines, with a significant cost and a different life, are depreciated separately (IAS 16, paras. 43 and 44).","es":""}},{"id":"S2","text":{"fr":"","en":"The two identical main engines (12 years, straight-line) form a single component.","es":""},"erroneous":false},{"id":"S3","text":{"fr":"","en":"The small equipment (1,500,000 in total, none significant) is not depreciated.","es":""},"erroneous":true,"correction":{"fr":"","en":"The remainder is depreciated, by approximation if needed (IAS 16, para. 46).","es":""}},{"id":"S4","text":{"fr":"","en":"The components add up to 39,600,000; the 400,000 difference with cost is left aside.","es":""},"erroneous":true,"correction":{"fr":"","en":"The whole initial cost is allocated to the parts (IAS 16, para. 44): the difference must be allocated, for example to the remainder.","es":""}},{"id":"S5","text":{"fr":"","en":"The navigation radar, not significant, is tracked separately because it will be replaced separately.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000130","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"HOSPITALITY","tested_point":"COMPONENT_DEPRECIATION_ENTRY","difficulty":"INTERMEDIATE","estimated_time_s":150,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"entry"},"references":["IAS 16 §43","IAS 16 §48"],"exercise":{"prompt":{"fr":"","en":"Case data: a hotel (excluding land) is broken down into the structure EUR 4,000,000 (40 years) and professional kitchens EUR 600,000 (10 years), straight-line, zero residual values. The entity keeps one accumulated depreciation account per component. Record the annual depreciation entry.","es":""},"explanation":{"fr":"","en":"Approach: 1) each component is depreciated over its own life (IAS 16, para. 43): structure 4,000,000 ÷ 40 = 100,000; kitchens 600,000 ÷ 10 = 60,000; 2) total 160,000, debited to depreciation expense (profit or loss) because the hotel is not used to produce any other asset (IAS 16, para. 48); 3) each credit goes to the accumulated depreciation account of the component concerned. Check: debit 160,000 = credits 100,000 + 60,000. Main trap: a global calculation over 40 years (115,000) which understates the charge. Rule to remember: one charge per component, credited to that component's accumulated depreciation, and expensed when the asset is not used to produce another asset.","es":""},"common_error":{"fr":"","en":"Depreciating the EUR 4,600,000 as a single block instead of each component over its own life.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"DEP_EXP","text":{"fr":"","en":"Depreciation expense (profit or loss)","es":""}},{"id":"AD_STRUCTURE","text":{"fr":"","en":"Accumulated depreciation — structure","es":""}},{"id":"AD_KITCHENS","text":{"fr":"","en":"Accumulated depreciation — kitchens","es":""}},{"id":"INVENTORIES","text":{"fr":"","en":"Inventories (production costs)","es":""}},{"id":"BUILDINGS","text":{"fr":"","en":"Buildings (gross)","es":""}}],"lines":[{"id":"L1","account":"DEP_EXP","side":"DEBIT","amount":160000},{"id":"L2","account":"AD_STRUCTURE","side":"CREDIT","amount":100000},{"id":"L3","account":"AD_KITCHENS","side":"CREDIT","amount":60000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000131","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"TELECOM","tested_point":"COMPONENT_BREAKDOWN_JUSTIFICATION","difficulty":"EXPERT","estimated_time_s":540,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"judgment"},"references":["IAS 16 §43","IAS 16 §44","IAS 16 §45","IAS 16 §46"],"exercise":{"prompt":{"fr":"","en":"Analyse the breakdown of NetCore's data centre.","es":""},"explanation":{"fr":"","en":"Three-step approach. 1) Judgement: the entity cannot freely choose a single unit; the technical installations (power distribution 8,000,000, cooling 7,000,000, generators 3,000,000) each weigh between 6% and 16% of 50,000,000 and have shorter lives: they are depreciated separately (IAS 16, paras. 43 and 44). 2) Calculation: building envelope 30,000,000 ÷ 40 = 750,000; power distribution and cooling grouped (same life and method, case assumptions) 15,000,000 ÷ 15 = 1,000,000 (IAS 16, para. 45); generators 3,000,000 ÷ 20 = 150,000; remainder 2,000,000 ÷ 10 = 200,000 (estimated average life, case data); (IAS 16, para. 46); total 2,100,000. 3) Impact: a single block over 40 years would give 1,250,000; annual depreciation of 850,000 would be missing and the carrying amount overstated by the same amount. Rule to remember: simplicity does not justify abandoning the component approach (IAS 16, para. 43). Professional judgement: it is prudent to document the breakdown adopted.","es":""},"common_error":{"fr":"","en":"Choosing the unit of depreciation \"for simplicity\" (a single 40-year block) when significant parts have shorter lives.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"NetCore, a telecoms operator, brings a data centre (building and technical installations, excluding servers) into service on 1 January N for EUR 50,000,000. The CFO proposes to depreciate it as a single block over 40 years, 'for simplicity'. Straight-line method and zero residual values for all parts (case assumptions).","es":""},"exhibits":[{"title":{"fr":"","en":"Technical report (case data)","es":""},"body":{"fr":"","en":"Building shell: 30,000,000, 40 years. Electrical distribution: 8,000,000, 15 years. Cooling: 7,000,000, 15 years. Generators: 3,000,000, 20 years. Various small equipment, none significant: 2,000,000, estimated average life 10 years.","es":""}}],"parts":[{"prompt":{"fr":"","en":"Is the CFO's proposal acceptable?","es":""},"explanation":{"fr":"","en":"Approach: look at the weight and life of each part. Each part whose cost is significant in relation to the total cost is depreciated separately (IAS 16, paras. 43 and 44). Rule to remember: significant parts with a shorter life are depreciated separately from a single block (IAS 16, paras. 43 and 44).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Yes, the entity is free to choose its unit of depreciation.","es":""},"correct":false,"feedback":{"fr":"","en":"The choice of depreciation unit is not free: each part whose cost is significant in relation to the total cost is depreciated separately (IAS 16, paras. 43 and 44). The technical installations, which have a significant cost and a shorter life, cannot therefore be absorbed into a 40-year block. Rule to remember: simplicity does not remove the need to depreciate significant parts separately (IAS 16, para. 43).","es":""}},{"id":"B","text":{"fr":"","en":"No: the technical installations, with a significant cost and a shorter life, must be depreciated separately.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Yes, if the notes state the life used.","es":""},"correct":false,"feedback":{"fr":"","en":"A note disclosure does not replace applying the component rule: even if the life used is disclosed, parts with a significant cost are depreciated separately (IAS 16, paras. 43 and 44). The note describes a choice, it does not make it compliant. Rule to remember: disclosure in the notes does not exempt the entity from component depreciation (IAS 16, para. 43).","es":""}}],"id":"P1","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"NetCore groups electrical distribution and cooling (same life, same method) and depreciates the remainder over 10 years. Calculate the charge for N.","es":""},"explanation":{"fr":"","en":"Approach: depreciate each part or group of parts over its own life, then the remainder. 30,000,000 ÷ 40 = 750,000; (8,000,000 + 7,000,000) ÷ 15 = 1,000,000 (grouping, IAS 16, para. 45); 3,000,000 ÷ 20 = 150,000; remainder 2,000,000 ÷ 10 = 200,000 (IAS 16, para. 46); total 2,100,000. Rule to remember: parts with the same life and method may be grouped (IAS 16, para. 45) and the remainder is depreciated (IAS 16, para. 46).","es":""},"common_error":{"fr":"","en":"Forgetting the remainder or depreciating separately parts that may be grouped: parts with the same life and method can be grouped, and the remainder is depreciated.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"See the technical report","es":""},"value":"—","unit":"TEXT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Building shell","es":""},"answer":750000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Electrical and cooling grouped","es":""},"answer":1000000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Generators","es":""},"answer":150000,"tolerance":0,"unit":"EUR"},{"id":"S4","label":{"fr":"","en":"Remainder","es":""},"answer":200000,"tolerance":0,"unit":"EUR"},{"id":"S5","label":{"fr":"","en":"Total charge","es":""},"answer":2100000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION","formula":{"lines":[{"step":"S4","meaning":{"fr":"","en":"Remainder","es":""},"expression":"a / 10","variables":[{"symbol":"a","meaning":{"fr":"","en":"Various small equipment, none significant: 2,000,000","es":""},"value":2000000}],"result":200000,"unit":"EUR"},{"step":"S5","meaning":{"fr":"","en":"Total charge","es":""},"expression":"a + b + c + d","variables":[{"symbol":"a","meaning":{"fr":"","en":"Building shell","es":""},"value":750000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Electrical and cooling grouped","es":""},"value":1000000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Generators","es":""},"value":150000,"unit":"EUR"},{"symbol":"d","meaning":{"fr":"","en":"Remainder","es":""},"value":200000,"unit":"EUR"}],"result":2100000,"unit":"EUR"}],"rationale":{"fr":"","en":"parts with the same life and method may be grouped (IAS 16, para. 45) and the remainder is depreciated (IAS 16, para. 46).","es":""},"references":["REF.IAS16.45","REF.IAS16.46"]}},{"prompt":{"fr":"","en":"Measure the effect of the initial proposal.","es":""},"explanation":{"fr":"","en":"Approach: compare the single-block charge with the component charge. 50,000,000 ÷ 40 = 1,250,000; 2,100,000 − 1,250,000 = 850,000 of charge missing each year, with the carrying amount overstated by the same amount. Trap: believing a single block is neutral. Rule to remember: depreciating parts of different lives as one block understates the charge here (IAS 16, para. 43).","es":""},"common_error":{"fr":"","en":"Believing depreciating as a single block is neutral: with parts of different lives, depreciation is here understated by 850,000 a year.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"Depreciated as a block over 40 years, the centre would have an annual charge of EUR {{single}}, an understatement of EUR {{gap}} compared with the component approach.","es":""},"blanks":[{"id":"single","mode":"NUMBER","answer":1250000,"tolerance":0},{"id":"gap","mode":"NUMBER","answer":850000,"tolerance":0}],"id":"P3","dimension":"ANALYSIS"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000132","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.CHARGE_RECOGNITION"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"CONSTRUCTION","tested_point":"CHARGE_TO_SELF_CONSTRUCTED_ASSET","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"charge-rule"},"references":["IAS 16 §22","IAS 16 §48"],"exercise":{"prompt":{"fr":"","en":"Case data: a civil engineering company uses its own excavator for four months to build its new head office. Where does it recognise the excavator's depreciation for those four months?","es":""},"explanation":{"fr":"","en":"The charge goes to profit or loss, unless it is included in the carrying amount of another asset (IAS 16, para. 48); an asset built by the entity follows the same principles as an acquired asset (IAS 16, para. 22): the share of the excavator consumed to build it is part of its cost.","es":""},"common_error":{"fr":"","en":"Systematically expensing depreciation, even when the asset is used to build another asset of the entity.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"As an expense of the period, like any charge.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer applies the general rule (depreciation in profit or loss) without seeing the exception. Depreciation is recognised in profit or loss unless it is included in the carrying amount of another asset (IAS 16, para. 48). Here the excavator is used to build the head office, an asset constructed by the entity whose cost follows the same principles as an acquired asset (IAS 16, para. 22): the depreciation consumed during the four months becomes part of its cost. Rule to remember: depreciation follows the asset it helps to build.","es":""}},{"id":"B","text":{"fr":"","en":"In the cost of the head office under construction.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"In the cost of the company's inventories.","es":""},"correct":false,"feedback":{"fr":"","en":"Inventories receive depreciation when the asset is used to produce goods for sale (IAS 16, para. 49), which is not the case here: the excavator builds the head office, a non-current asset of the entity. The depreciation for these four months therefore joins the cost of the head office under construction (IAS 16, paras. 22 and 48), not inventories. Rule to remember: depreciation is added to the cost of the other asset actually being produced, whether inventory or a non-current asset.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000133","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.CHARGE_RECOGNITION"],"dimension":"CALCULATION","format":"CALCULATION","context":"FOOD","tested_point":"CHARGE_THROUGH_INVENTORIES","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"charge-entry"},"references":["IAS 16 §48","IAS 16 §49","IAS 2 §12"],"exercise":{"prompt":{"fr":"","en":"Case data: a cannery depreciates its production lines by EUR 300,000 for the year, at normal capacity. 60% of the year's output has been sold; the rest is in inventory at the reporting date. Calculate where the charge sits at the reporting date.","es":""},"explanation":{"fr":"","en":"Approach: 1) the production lines are used to make inventories: their depreciation is part of the costs of conversion (IAS 16, para. 49); (IAS 2, para. 12); 2) it therefore reaches profit or loss only on sale; 3) 300,000 × 60% = 180,000 in cost of sales; 4) the balance, 120,000, stays in closing inventories (IAS 16, para. 48). Activity is normal, so all the depreciation is absorbed. Main trap: expensing the 300,000 as soon as it is incurred. Rule to remember: the depreciation of a production asset is included in the cost of inventories and reaches profit or loss as the goods are sold (IAS 16, para. 49).","es":""},"common_error":{"fr":"","en":"Expensing the full 300,000 in the year as soon as it is recognised.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Depreciation of production lines","es":""},"value":"300000","unit":"EUR"},{"label":{"fr":"","en":"Share of output sold","es":""},"value":"60","unit":"PERCENT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Amount in cost of sales (profit or loss)","es":""},"answer":180000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Amount remaining in closing inventories","es":""},"answer":120000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000134","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.CHARGE_RECOGNITION"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"PHARMA","tested_point":"CHARGE_SPLIT_INVENTORY_EXPENSE","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"charge-entry"},"references":["IAS 16 §48","IAS 16 §49","IAS 2 §12"],"exercise":{"prompt":{"fr":"","en":"Case data: the building of a pharmaceutical site is depreciated by EUR 120,000 a year. Based on floor areas (case data), 80% of the building houses production at normal capacity and 20% administrative offices. Teaching assumption: the production share is posted directly to inventories. Record the depreciation entry.","es":""},"explanation":{"fr":"","en":"Approach: 1) identify the use: 80% of the building houses production at normal capacity, 20% administration; 2) the production share, 120,000 × 80% = 96,000, is added to inventory cost (IAS 16, para. 49); (IAS 2, para. 12); 3) the administrative share, 120,000 × 20% = 24,000, is an expense of the period (IAS 16, para. 48); 4) the total credit of 120,000 goes to accumulated depreciation. Check: debits 96,000 + 24,000 = credit 120,000. Allocating by floor area is case data, not imposed by the standard, and posting directly to inventories is a teaching assumption. Main trap: expensing everything. Rule to remember: depreciation follows the use of the asset, inventories for the production share, profit or loss for the rest.","es":""},"common_error":{"fr":"","en":"Expensing the whole EUR 120,000 depreciation charge without distinguishing the part of the building that houses production.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"INVENTORIES","text":{"fr":"","en":"Inventories (production costs)","es":""}},{"id":"DEP_EXP","text":{"fr":"","en":"Depreciation expense (profit or loss)","es":""}},{"id":"ACC_DEP","text":{"fr":"","en":"Accumulated depreciation","es":""}},{"id":"COST_OF_SALES","text":{"fr":"","en":"Cost of sales (profit or loss)","es":""}}],"lines":[{"id":"L1","account":"INVENTORIES","side":"DEBIT","amount":96000},{"id":"L2","account":"DEP_EXP","side":"DEBIT","amount":24000},{"id":"L3","account":"ACC_DEP","side":"CREDIT","amount":120000,"given":["account","side","amount"]}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000135","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.CHARGE_RECOGNITION"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"AUTOMOTIVE","tested_point":"UNDER_ACTIVITY_DEPRECIATION_EXPENSED","difficulty":"INTERMEDIATE","estimated_time_s":45,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"charge-rule"},"references":["IAS 16 §49","IAS 2 §13"],"exercise":{"prompt":{"fr":"","en":"Case data: a car plant was shut for three months due to a supply shortage, with output well below normal capacity. True or false: the whole annual depreciation of the plant may be spread over the vehicles produced, even if this raises the unit cost.","es":""},"explanation":{"fr":"","en":"False. Reasoning: depreciation of a production plant does form part of inventory cost (IAS 16, para. 49), but fixed overheads are allocated on the basis of normal capacity. In a period of low production, the fixed overhead per unit is not increased and the unallocated amount is expensed in the period (IAS 2, para. 13). Main trap: spreading the whole charge over few units, which would inflate the unit cost above normal cost. Rule to remember: in under-activity, the amount absorbed at normal capacity is included in inventories; the rest is expensed.","es":""},"common_error":{"fr":"","en":"Believing that, in a period of low activity, all depreciation can increase the unit cost of inventories instead of the unallocated part being expensed.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000136","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS","IAS16.DEPRECIATION.CHARGE_RECOGNITION"],"dimension":"APPLICATION","format":"MINI_CASE","context":"FOOD","tested_point":"COMPONENTS_AND_INVENTORY_ABSORPTION","difficulty":"ADVANCED","estimated_time_s":420,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"charge-entry"},"references":["IAS 16 §43","IAS 16 §48","IAS 16 §49","IAS 2 §12"],"exercise":{"prompt":{"fr":"","en":"Deal with the depreciation of Panifour's industrial bakery line for year N.","es":""},"explanation":{"fr":"","en":"Three-step approach. 1) Calculation by component (IAS 16, para. 43): 900,000 ÷ 15 = 60,000; 300,000 ÷ 10 = 30,000; 200,000 ÷ 5 = 40,000; total 130,000. 2) Recognition: the line is used only to make goods for sale, so depreciation is added to inventory cost (IAS 16, paras. 48 and 49); (IAS 2, para. 12), not to administrative expenses nor to the cost of the line itself. 3) Sales: 130,000 × 80% = 104,000 goes to cost of sales (debit cost of sales, credit inventories); 26,000 stays in closing inventories. Main trap: confusing the moment depreciation arises with the moment it reaches profit or loss. Rule to remember: the depreciation of a production asset is included in the cost of inventories and reaches profit or loss as the goods are sold (IAS 16, para. 49).","es":""},"common_error":{"fr":"","en":"Expensing depreciation as soon as it arises, instead of adding it to inventory cost and releasing it to profit or loss only on sale.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Panifour brings into service on 1 January N an industrial bakery line costing EUR 1,400,000, used only to make products for sale. Output at normal capacity; 80% of N's output is sold (case data). Straight-line method and zero residual values (case assumptions).","es":""},"exhibits":[{"title":{"fr":"","en":"Components (case data)","es":""},"body":{"fr":"","en":"Tunnel oven: 900,000, 15 years. Conveyors: 300,000, 10 years. Packaging module: 200,000, 5 years.","es":""}}],"parts":[{"prompt":{"fr":"","en":"Calculate the N charge by component.","es":""},"explanation":{"fr":"","en":"Approach: divide the cost of each component by its useful life. 900,000 ÷ 15 = 60,000; 300,000 ÷ 10 = 30,000; 200,000 ÷ 5 = 40,000; total 130,000 (IAS 16, para. 43). Rule to remember: each significant component has its own charge, calculated on its own life (IAS 16, para. 43).","es":""},"common_error":{"fr":"","en":"Applying an average life to the whole line: each significant component is depreciated over its own life.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"See the components","es":""},"value":"—","unit":"TEXT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Tunnel oven","es":""},"answer":60000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Conveyors","es":""},"answer":30000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Packaging module","es":""},"answer":40000,"tolerance":0,"unit":"EUR"},{"id":"S4","label":{"fr":"","en":"Total","es":""},"answer":130000,"tolerance":0,"unit":"EUR"}],"id":"P1","dimension":"CALCULATION","formula":{"lines":[{"step":"S2","meaning":{"fr":"","en":"Conveyors","es":""},"expression":"a / 10","variables":[{"symbol":"a","meaning":{"fr":"","en":"Conveyors: 300,000","es":""},"value":300000}],"result":30000,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Packaging module","es":""},"expression":"a / 5","variables":[{"symbol":"a","meaning":{"fr":"","en":"Packaging module: 200,000","es":""},"value":200000}],"result":40000,"unit":"EUR"},{"step":"S4","meaning":{"fr":"","en":"Total","es":""},"expression":"a + b + c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Tunnel oven","es":""},"value":60000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Conveyors","es":""},"value":30000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Packaging module","es":""},"value":40000,"unit":"EUR"}],"result":130000,"unit":"EUR"}],"rationale":{"fr":"","en":"each significant component has its own charge, calculated on its own life (IAS 16, para. 43).","es":""},"references":["REF.IAS16.43"]}},{"prompt":{"fr":"","en":"Where is the charge recognised when it arises?","es":""},"explanation":{"fr":"","en":"The charge is included in the cost of another asset when the item's benefits are absorbed in producing it: here, inventories (IAS 16, paras. 48 and 49; IAS 2, para. 12).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"In the cost of the manufactured inventories.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"In administrative expenses.","es":""},"correct":false,"feedback":{"fr":"","en":"The line is used only to make products intended for sale: its benefits are absorbed in the production of inventories, so the charge is included in their cost instead of being expensed as administrative costs (IAS 16, paras. 48 and 49). Rule to remember: the depreciation of a production asset is included in the cost of the inventories made (IAS 16, para. 49).","es":""}},{"id":"C","text":{"fr":"","en":"In the cost of the line itself.","es":""},"correct":false,"feedback":{"fr":"","en":"An asset does not include its own depreciation in its cost: depreciation spreads its cost and reduces its carrying amount. When the charge is included in the cost of another asset, here it is the inventories made with the line (IAS 16, paras. 48 and 49). Rule to remember: the charge goes to profit or loss or into the cost of another asset, not into the cost of the asset being depreciated (IAS 16, para. 48).","es":""}}],"id":"P2","dimension":"RECOGNITION"},{"prompt":{"fr":"","en":"Record the inventory release for N's sales (depreciation share only).","es":""},"explanation":{"fr":"","en":"Approach: apply the 80% sales rate to the charge included in inventories. 130,000 × 80% = 104,000 go to cost of sales; 26,000 remain in closing inventories. Trap: expensing the 130,000 as soon as it is recognised. Rule to remember: the charge included in inventories reaches profit or loss as the goods are sold (IAS 16, para. 49).","es":""},"common_error":{"fr":"","en":"Expensing the full 130,000 immediately: depreciation included in inventory reaches profit or loss as the goods are sold.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"COST_OF_SALES","text":{"fr":"","en":"Cost of sales (profit or loss)","es":""}},{"id":"INVENTORIES","text":{"fr":"","en":"Inventories (production costs)","es":""}},{"id":"DEP_EXP","text":{"fr":"","en":"Depreciation expense (profit or loss)","es":""}},{"id":"ACC_DEP","text":{"fr":"","en":"Accumulated depreciation","es":""}}],"lines":[{"id":"L1","account":"COST_OF_SALES","side":"DEBIT","amount":104000},{"id":"L2","account":"INVENTORIES","side":"CREDIT","amount":104000}],"id":"P3","dimension":"JOURNAL_ENTRY"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000137","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"APPLICATION","format":"ORDERING","context":"GENERIC","tested_point":"COMPONENT_BREAKDOWN_ORDER","difficulty":"BEGINNER","estimated_time_s":60,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"how"},"references":["IAS 16 §43","IAS 16 §44","IAS 16 §45","IAS 16 §46"],"exercise":{"prompt":{"fr":"","en":"Put the steps for breaking down an asset in order.","es":""},"explanation":{"fr":"","en":"Reason from identification to depreciation. First list the main parts (S1), then allocate the total cost among them (IAS 16, para. 44), because significance is measured against total cost: it is then tested (S3, IAS 16, para. 43). Significant parts receive their own life and method (S4), those with the same life and method may be grouped (S5, IAS 16, para. 45), and the remainder is formed and depreciated (S6, IAS 16, para. 46). Main trap: testing significance without knowing the cost of each part. This order is a teaching working approach, not a sequence imposed by the standard. Rule to remember: parts, cost allocated, significance, life and method, grouping, remainder.","es":""},"common_error":{"fr":"","en":"Isolating the significant parts before the cost has been allocated, or forgetting the remainder once the significant parts are depreciated separately.","es":""},"format":"ORDERING","steps":[{"id":"S1","text":{"fr":"","en":"List the major parts from the technical documents","es":""}},{"id":"S2","text":{"fr":"","en":"Allocate the total cost to these parts","es":""}},{"id":"S3","text":{"fr":"","en":"Test the significance of each part","es":""}},{"id":"S4","text":{"fr":"","en":"Assign a life and method to each significant part","es":""}},{"id":"S5","text":{"fr":"","en":"Group parts with the same life and method","es":""}},{"id":"S6","text":{"fr":"","en":"Form and depreciate the remainder","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000138","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"PROFESSIONAL_JUDGMENT","format":"SINGLE_CHOICE","context":"MEDIA","tested_point":"REMAINDER_FAITHFUL_APPROXIMATION","difficulty":"ADVANCED","estimated_time_s":120,"lesson_id":"LS.IAS16.000011","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"judgment"},"references":["IAS 16 §43","IAS 16 §46","IAS 16 §47"],"exercise":{"prompt":{"fr":"","en":"Case data: a newspaper rotary press costs EUR 5,000,000 (25 years). Its ink rollers represent 3% of cost and wear out in 2 years; the entity does not consider them significant. It proposes to leave them in a remainder depreciated over 25 years, like the machine. Which analysis do you adopt?","es":""},"explanation":{"fr":"","en":"Parts with a significant cost are separated (IAS 16, para. 43); an insignificant part may be, at the entity's choice (IAS 16, para. 47); otherwise the remainder is depreciated using an approximation technique that faithfully reflects the consumption pattern or useful life (IAS 16, para. 46).","es":""},"common_error":{"fr":"","en":"Considering that a non-significant part can be depreciated over the life of the whole asset, regardless of how quickly it actually wears out.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Acceptable: an insignificant part may be depreciated over the life of the machine.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer turns non-significance into an exemption from faithfulness. The remainder may be depreciated by approximation, but that approximation must faithfully reflect the pattern of consumption or the useful life (IAS 16, para. 46). Depreciating over 25 years rollers that wear out in 2 years (EUR 150,000, i.e. 6,000 a year instead of 75,000) would leave their carrying amount overstated. Rule to remember: for the remainder, approximation is allowed, unfaithfulness is not.","es":""}},{"id":"B","text":{"fr":"","en":"Not faithful: either the entity isolates the rollers (a permitted option), or it depreciates the remainder using an approximation that reflects their rapid wear.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Mandatory: any short-lived part must be isolated, whatever its cost.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer turns an option into an obligation. Separation is required for parts with a significant cost (IAS 16, para. 43); for a non-significant part such as the rollers (3% of cost), the entity may choose to isolate it but is not required to (IAS 16, para. 47), provided the remainder faithfully reflects their wear (IAS 16, para. 46). Rule to remember: a short life does not make it mandatory to isolate a non-significant part.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000139","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.DEPRECIABLE_AMOUNT","IAS16.DEPRECIATION.RESIDUAL_VALUE"],"dimension":"CALCULATION","format":"CALCULATION","context":"AGRICULTURE","tested_point":"DEPRECIABLE_AMOUNT_NET_OF_RESIDUAL","difficulty":"BEGINNER","estimated_time_s":60,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"depreciable-amount"},"references":["IAS 16 §50","IAS 16 §53"],"exercise":{"prompt":{"fr":"","en":"An agricultural cooperative buys a combine harvester. Calculate the depreciable amount and the annual straight-line charge (straight-line method: teaching assumption).","es":""},"explanation":{"fr":"","en":"Approach: 1) depreciable amount = cost − residual value = 250,000 − 25,000 = 225,000 (IAS 16, para. 53); 2) this amount is allocated on a systematic basis over the useful life (IAS 16, para. 50): 225,000 ÷ 9 = 25,000 a year on a straight-line basis (teaching assumption). Main trap: dividing total cost by the life (250,000 ÷ 9 ≈ 27,778) and forgetting the residual value. Rule to remember: depreciate cost less residual value, not gross cost.","es":""},"common_error":{"fr":"","en":"Dividing total cost by the life (250,000 ÷ 9 ≈ 27,778), forgetting the residual value.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost","es":""},"value":"250000","unit":"EUR"},{"label":{"fr":"","en":"Residual value","es":""},"value":"25000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"9","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Depreciable amount","es":""},"answer":225000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Annual charge","es":""},"answer":25000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Depreciable amount","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":250000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Residual value","es":""},"value":25000,"unit":"EUR"}],"result":225000,"unit":"EUR","rationale":{"fr":"","en":"Approach: 1) depreciable amount = cost − residual value = 250,000 − 25,000 = 225,000 (IAS 16, para. 53)","es":""}},{"step":"S2","meaning":{"fr":"","en":"Annual charge","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Depreciable amount","es":""},"value":225000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Useful life","es":""},"value":9,"unit":"YEARS"}],"result":25000,"unit":"EUR","rationale":{"fr":"","en":"this amount is allocated on a systematic basis over the useful life (IAS 16, para. 50): 225,000 ÷ 9 = 25,000 a year on a straight-line basis (teaching assumption).","es":""}}],"rationale":{"fr":"","en":"depreciate cost less residual value, not gross cost.","es":""},"references":["REF.IAS16.50","REF.IAS16.53"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000140","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.DEPRECIABLE_AMOUNT"],"dimension":"RULE_KNOWLEDGE","format":"MULTIPLE_CHOICE","context":"RETAIL","tested_point":"DEPRECIATION_DESPITE_MAINTENANCE_OR_VALUE_RISE","difficulty":"INTERMEDIATE","estimated_time_s":45,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"depreciable-amount"},"references":["IAS 16 §52","IAS 16 §54"],"exercise":{"prompt":{"fr":"","en":"A retail chain owns a store (building). In which situations does depreciation of the building continue? (Several answers possible.)","es":""},"explanation":{"fr":"","en":"Depreciation continues even if fair value exceeds the carrying amount, and maintenance does not remove the need to depreciate (IAS 16, para. 52). Only a residual value equal to or greater than the carrying amount makes the charge zero (IAS 16, para. 54).","es":""},"common_error":{"fr":"","en":"Believing that maintenance, or a fair value above carrying amount, removes the need to depreciate.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"An appraisal shows that the store's fair value exceeds its carrying amount; the residual value remains below the carrying amount.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The store has just been fully renovated and maintained.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The building's re-estimated residual value becomes greater than its carrying amount.","es":""},"correct":false,"feedback":{"fr":"","en":"This option describes a situation where depreciation stops, not one where it continues. When the residual value reaches or exceeds the carrying amount, the charge is nil until the residual value falls back below it (IAS 16, para. 54). In options A and B, the residual value stays below the carrying amount: a high fair value or maintenance does not remove the need to depreciate (IAS 16, para. 52). Rule to remember: the charge is nil if residual value equals or exceeds the carrying amount (IAS 16, para. 54).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000141","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.RESIDUAL_VALUE","IAS16.DEPRECIATION.DEPRECIABLE_AMOUNT"],"dimension":"CALCULATION","format":"FILL_BLANK","context":"MARITIME","tested_point":"RESIDUAL_VALUE_ABOVE_CARRYING_AMOUNT","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"residual-value"},"references":["IAS 16 §54","IAS 16 §51"],"exercise":{"prompt":{"fr":"","en":"Complete.","es":""},"explanation":{"fr":"","en":"Approach: 1) compare the re-estimated residual value, 19,500,000, with the carrying amount, 18,000,000: it exceeds it; 2) in that case the charge is nil (IAS 16, para. 54), i.e. 0 for N+8; 3) it will resume when the residual value falls back below the carrying amount, not below the original cost; as the residual value is reviewed at each year-end (IAS 16, para. 51), the position may change. Main trap: comparing the residual value with original cost, or believing the stop is permanent. Rule to remember: nil charge while the residual value equals or exceeds the carrying amount; it resumes as soon as the residual value falls below it.","es":""},"common_error":{"fr":"","en":"Continuing to depreciate out of habit despite a residual value above the carrying amount, or believing that the stop in depreciation is permanent.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"At the start of N+8, a container ship has a carrying amount of EUR 18,000,000 and 7 years of remaining useful life. With the second-hand market soaring, its residual value is re-estimated at EUR 19,500,000. Charge for N+8: EUR {{charge}}. Depreciation will resume when the residual value is {{when}}.","es":""},"blanks":[{"id":"charge","mode":"NUMBER","answer":0,"tolerance":0},{"id":"when","mode":"CHOICE","choices":[{"id":"BELOW","text":{"fr":"","en":"below the carrying amount","es":""}},{"id":"BELOW_COST","text":{"fr":"","en":"below original cost","es":""}},{"id":"NEVER","text":{"fr":"","en":"never: the stop is permanent","es":""}}],"answer":"BELOW"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000142","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.RESIDUAL_VALUE"],"dimension":"CALCULATION","format":"CALCULATION","context":"CONSTRUCTION","tested_point":"RESIDUAL_VALUE_CURRENT_PRICES_NET_OF_COSTS","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"residual-value"},"references":["IAS 16 §6","IAS 16 §53"],"exercise":{"prompt":{"fr":"","en":"A construction company buys a telehandler which it always sells after 5 years. Calculate the residual value and the straight-line charge (teaching assumption) applying the IAS 16 definition.","es":""},"explanation":{"fr":"","en":"Approach: 1) residual value is measured at current prices, for an asset already of the age and in the condition expected at the end of its useful life, after estimated disposal costs (IAS 16, para. 6): 20,000 − 2,000 = 18,000; 2) the future price of 24,000, inflation included, is irrelevant; 3) depreciable amount = 80,000 − 18,000 = 62,000 (IAS 16, para. 53); 4) straight-line charge = 62,000 ÷ 5 = 12,400. Main trap: using the future price of 24,000 or forgetting to deduct disposal costs. Rule to remember: residual value = current price of a comparable asset at the end of its life, net of disposal costs, with no future inflation.","es":""},"common_error":{"fr":"","en":"Using the future price of 24,000 (projected inflation) or forgetting the costs of disposal.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost","es":""},"value":"80000","unit":"EUR"},{"label":{"fr":"","en":"Current price of a 5-year-old machine in the expected condition","es":""},"value":"20000","unit":"EUR"},{"label":{"fr":"","en":"Estimated costs of disposal","es":""},"value":"2000","unit":"EUR"},{"label":{"fr":"","en":"Price expected in 5 years by a dealer, including inflation","es":""},"value":"24000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"5","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Residual value","es":""},"answer":18000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Annual charge","es":""},"answer":12400,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Residual value","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Current price of a 5-year-old machine in the expected condition","es":""},"value":20000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Estimated costs of disposal","es":""},"value":2000,"unit":"EUR"}],"result":18000,"unit":"EUR","rationale":{"fr":"","en":"Approach: 1) residual value is measured at current prices, for an asset already of the age and in the condition expected at the end of its useful life, after estimated disposal costs (IAS 16, para. 6): 20,000 − 2,000 = 18,000","es":""}},{"step":"S2","meaning":{"fr":"","en":"Annual charge","es":""},"expression":"(a - b) / c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":80000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Residual value","es":""},"value":18000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Useful life","es":""},"value":5,"unit":"YEARS"}],"result":12400,"unit":"EUR"}],"rationale":{"fr":"","en":"residual value = current price of a comparable asset at the end of its life, net of disposal costs, with no future inflation.","es":""},"references":["REF.IAS16.6","REF.IAS16.53"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000143","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.USEFUL_LIFE"],"dimension":"RECOGNITION","format":"CLASSIFICATION","context":"TELECOM","tested_point":"USEFUL_LIFE_FACTORS","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"useful-life"},"references":["IAS 16 §56"],"exercise":{"prompt":{"fr":"","en":"A telecom operator estimates the useful life of its network equipment. Classify each item: a factor to consider under IAS 16, or an irrelevant item.","es":""},"explanation":{"fr":"","en":"Approach: for each item, ask whether it affects how long the entity expects to use the equipment. The factors listed in paragraph 56 of IAS 16 are expected usage (I1), physical wear and tear (I2), technical or commercial obsolescence (I3, the announced new generation) and legal limits (I4, the licence). The tax depreciation period (I5) and the recent rise in the market value of the equipment (I6) do not describe the utility expected by the entity: they are classified as not relevant (IAS 16, paras. 56 and 57). Main trap: using the tax period out of convenience. Rule to remember: useful life depends on usage, wear, obsolescence and legal limits (IAS 16, para. 56), not on the tax period or the market value of the equipment.","es":""},"common_error":{"fr":"","en":"Using the tax depreciation period or market value as a factor in useful life.","es":""},"format":"CLASSIFICATION","categories":[{"id":"FACTOR","text":{"fr":"","en":"Useful life factor","es":""}},{"id":"NOT_RELEVANT","text":{"fr":"","en":"Not relevant","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Expected capacity and intensity of use of the equipment","es":""},"category":"FACTOR"},{"id":"I2","text":{"fr":"","en":"Physical wear linked to the climate at the sites","es":""},"category":"FACTOR"},{"id":"I3","text":{"fr":"","en":"Announced arrival of a new technology generation","es":""},"category":"FACTOR"},{"id":"I4","text":{"fr":"","en":"Expiry date of the spectrum licence","es":""},"category":"FACTOR"},{"id":"I5","text":{"fr":"","en":"Depreciation period accepted by the tax authorities","es":""},"category":"NOT_RELEVANT"},{"id":"I6","text":{"fr":"","en":"Recent rise in the market value of the equipment","es":""},"category":"NOT_RELEVANT"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000144","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.USEFUL_LIFE","IAS16.DEPRECIATION.RESIDUAL_VALUE"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"CAR_RENTAL","tested_point":"ENTITY_SPECIFIC_USEFUL_LIFE","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"useful-life"},"references":["IAS 16 §6","IAS 16 §53","IAS 16 §57"],"exercise":{"prompt":{"fr":"","en":"Analyse the fleet policy and calculate the charge.","es":""},"explanation":{"fr":"","en":"Two-step approach. 1) Life: useful life is defined by the utility expected by the entity and may be shorter than the economic life (IAS 16, para. 57); the constant policy of reselling after 2 years, applied for eight years, supports 2 years, not the manufacturer's 6 years, nor an average. 2) Calculation: residual value at the current price of a 2-year-old sedan, net of selling costs = 19,000 − 1,000 = 18,000 (IAS 16, para. 6); depreciation = (30,000 − 18,000) ÷ 2 = 6,000 (IAS 16, para. 53), straight line as a teaching assumption. With 6 years and nil residual value, the charge would be 5,000 and a loss would arise on each resale. Rule to remember: useful life reflects the entity's own usage policy, not the technical life of the asset.","es":""},"common_error":{"fr":"","en":"Using the manufacturer's stated life (6 years) as the useful life when the renter sells its cars after 2 years.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"A car rental company buys saloons at EUR 30,000 each. The manufacturer states a life of 6 years. The company's policy, applied for eight years, is to sell each car after 2 years. Today, a 2-year-old saloon with the company's usual mileage sells for EUR 19,000, with EUR 1,000 of preparation and selling costs.","es":""},"parts":[{"prompt":{"fr":"","en":"Which useful life should be used?","es":""},"explanation":{"fr":"","en":"Useful life is defined by the expected utility to the entity and may be shorter than the economic life (IAS 16, para. 57); the consistent resale policy supports it.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"6 years, the life stated by the manufacturer","es":""},"correct":false,"feedback":{"fr":"","en":"6 years is the life announced by the manufacturer, i.e. the economic life of the car, not the period over which the lessor expects to use it. Useful life is measured by the asset's expected utility to the entity and may be shorter than economic life (IAS 16, para. 57). Here, the lessor's policy is to resell after 2 years. Rule to remember: useful life reflects the use expected by the entity, not the life announced by the manufacturer (IAS 16, para. 57).","es":""}},{"id":"B","text":{"fr":"","en":"2 years, the holding period planned by the company","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"4 years, the average of policy and technical life","es":""},"correct":false,"feedback":{"fr":"","en":"An average of the policy and the technical life has no basis: useful life reflects the utility expected by the entity (IAS 16, para. 57), here the planned holding period of 2 years, supported by the policy applied for eight years. Blending two lives would make the charge arbitrary. Rule to remember: use the useful life expected by the entity, not an average of lives (IAS 16, para. 57).","es":""}}],"id":"P1","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"Calculate the residual value and the annual straight-line charge (straight-line: teaching assumption).","es":""},"explanation":{"fr":"","en":"Approach: first estimate the residual value from the current price net of selling costs, then spread the depreciable amount over 2 years. Residual value = 19,000 − 1,000 = 18,000 (IAS 16, para. 6); charge = (30,000 − 18,000) ÷ 2 = 6,000 (IAS 16, para. 53). Case convention: the straight-line method is a teaching assumption. Rule to remember: the charge spreads the depreciable amount, cost less residual value, over the useful life (IAS 16, para. 53).","es":""},"common_error":{"fr":"","en":"Taking the current gross price (19,000) as residual value: preparation and selling costs are deducted.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost","es":""},"value":"30000","unit":"EUR"},{"label":{"fr":"","en":"Current price of a 2-year-old saloon","es":""},"value":"19000","unit":"EUR"},{"label":{"fr":"","en":"Preparation and selling costs","es":""},"value":"1000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Residual value","es":""},"answer":18000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Annual charge","es":""},"answer":6000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Residual value","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Current price of a 2-year-old saloon","es":""},"value":19000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Preparation and selling costs","es":""},"value":1000,"unit":"EUR"}],"result":18000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Annual charge","es":""},"expression":"(a - b) / 2","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":30000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Residual value","es":""},"value":18000,"unit":"EUR"}],"result":6000,"unit":"EUR"}],"rationale":{"fr":"","en":"the charge spreads the depreciable amount, cost less residual value, over the useful life (IAS 16, para. 53).","es":""},"references":["REF.IAS16.6","REF.IAS16.53"]}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000145","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.LAND_AND_BUILDINGS"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"REAL_ESTATE","tested_point":"LAND_SEPARATED_FROM_BUILDING","difficulty":"ADVANCED","estimated_time_s":120,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"land-and-buildings"},"references":["IAS 16 §58"],"exercise":{"prompt":{"fr":"","en":"A company buys an office building for a single price of EUR 5,000,000. Review the assistant's accounting memo and spot the erroneous statements.","es":""},"explanation":{"fr":"","en":"Steps: separate the land and the building before calculating the charge. Land and buildings are accounted for separately even when acquired together; land, with an unlimited useful life, is generally not depreciated, the building is (IAS 16, para. 58). The allocation key used (expert report) is an assumption of the entity, not set by the standard. Trap: depreciating the overall price as a single asset, land included. Rule to remember: the charge relates to the cost of the building, less its residual value, and not to the overall price (IAS 16, para. 58). Effect on the financial statements: depreciating the land would overstate the charge and understate its carrying amount.","es":""},"common_error":{"fr":"","en":"Depreciating the overall price of a building as a single asset, land included.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The single price of 5,000,000 is recognised as one 'property' asset, because land and building were acquired together.","es":""},"erroneous":true,"correction":{"fr":"","en":"Land and building are accounted for separately, even when acquired together (IAS 16, para. 58).","es":""}},{"id":"S2","text":{"fr":"","en":"The land portion is determined from an independent expert report (approach chosen by the entity).","es":""},"erroneous":false},{"id":"S3","text":{"fr":"","en":"The land, with an unlimited useful life, is not depreciated.","es":""},"erroneous":false},{"id":"S4","text":{"fr":"","en":"The annual charge is calculated on 5,000,000, over the useful life of the building.","es":""},"erroneous":true,"correction":{"fr":"","en":"The charge is based on the cost of the building alone, less its residual value (IAS 16, para. 58).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000146","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.LAND_AND_BUILDINGS","IAS16.DEPRECIATION.DEPRECIABLE_AMOUNT"],"dimension":"CALCULATION","format":"CALCULATION","context":"HOSPITALITY","tested_point":"BUILDING_DEPRECIATION_EXCLUDING_LAND","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"numeric-example"},"references":["IAS 16 §53","IAS 16 §58"],"exercise":{"prompt":{"fr":"","en":"A hotel group buys a hotel for a single price. Calculate the annual charge (straight-line method: teaching assumption).","es":""},"explanation":{"fr":"","en":"Approach: 1) land and building are accounted for separately even when acquired together; building cost = 4,500,000 − 1,500,000 = 3,000,000; 2) land is not depreciated (IAS 16, para. 58); 3) charge = (3,000,000 − 300,000) ÷ 30 = 90,000 (IAS 16, para. 53), straight line as a teaching assumption. Main trap: depreciating the overall price, (4,500,000 − 300,000) ÷ 30 = 140,000, which wrongly depreciates the land. Rule to remember: first isolate the cost of the building, then depreciate only that, net of its residual value.","es":""},"common_error":{"fr":"","en":"Depreciating the single price: (4,500,000 − 300,000) ÷ 30 = 140,000.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Single price","es":""},"value":"4500000","unit":"EUR"},{"label":{"fr":"","en":"Land portion (expert report)","es":""},"value":"1500000","unit":"EUR"},{"label":{"fr":"","en":"Residual value of the building","es":""},"value":"300000","unit":"EUR"},{"label":{"fr":"","en":"Useful life of the building","es":""},"value":"30","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Cost of the building","es":""},"answer":3000000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Annual charge","es":""},"answer":90000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Cost of the building","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Single price","es":""},"value":4500000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Land portion (expert report)","es":""},"value":1500000,"unit":"EUR"}],"result":3000000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Annual charge","es":""},"expression":"(a - b) / c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the building","es":""},"value":3000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Residual value of the building","es":""},"value":300000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Useful life of the building","es":""},"value":30,"unit":"YEARS"}],"result":90000,"unit":"EUR"}],"rationale":{"fr":"","en":"first isolate the cost of the building, then depreciate only that, net of its residual value.","es":""},"references":["REF.IAS16.53","REF.IAS16.58"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000147","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.LAND_AND_BUILDINGS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"WASTE_MANAGEMENT","tested_point":"LAND_DEPRECIATION_EXCEPTIONS","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"land-and-buildings"},"references":["IAS 16 §58"],"exercise":{"prompt":{"fr":"","en":"A waste management entity operates a landfill site on land it owns. This land, like all land, can never be depreciated.","es":""},"explanation":{"fr":"","en":"False. Reasoning: land generally has an unlimited useful life and is not depreciated, but this rule has exceptions. Quarries and landfill sites are land whose usefulness is used up by the operation, so they may be depreciated (IAS 16, para. 58). The waste management entity in the question operates precisely a landfill. Main trap: generalising \"never\" from the usual rule. Rule to remember: land is generally not depreciated, except in cases such as quarries and landfill sites where it is used up.","es":""},"common_error":{"fr":"","en":"Applying \"land is never depreciated\" without exception, forgetting quarries and landfill sites.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000148","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.LAND_AND_BUILDINGS"],"dimension":"CALCULATION","format":"CALCULATION","context":"CHEMICALS","tested_point":"LAND_RESTORATION_COSTS_DEPRECIATED","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"numeric-example"},"references":["IAS 16 §16","IAS 16 §58","IAS 16 §59"],"exercise":{"prompt":{"fr":"","en":"A chemicals group acquires land to operate a production unit on it for 8 years; it will then have to restore the site. The initial estimate of those costs is included in the cost of the land. Calculate (straight-line: teaching assumption).","es":""},"explanation":{"fr":"","en":"Approach: 1) cost includes the initial estimate of restoration costs (IAS 16, para. 16): 700,000 + 160,000 = 860,000; 2) the land itself is not depreciated (IAS 16, para. 58); 3) however, the restoration costs included in its cost are depreciated over the period of the benefits (IAS 16, para. 59): 160,000 ÷ 8 = 20,000 a year, straight line as a teaching assumption. Main trap: not depreciating anything because \"land is not depreciated\", or depreciating 860,000 over 8 years. Rule to remember: land is not depreciated, but restoration costs forming part of its cost are, over the period of the benefits.","es":""},"common_error":{"fr":"","en":"Depreciating nothing ('land is not depreciated') or depreciating 860,000 over 8 years.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Purchase price of the land","es":""},"value":"700000","unit":"EUR"},{"label":{"fr":"","en":"Estimated restoration costs, included in cost","es":""},"value":"160000","unit":"EUR"},{"label":{"fr":"","en":"Operating period (benefits)","es":""},"value":"8","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Total cost of the land","es":""},"answer":860000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Annual charge","es":""},"answer":20000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Total cost of the land","es":""},"expression":"a + b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Purchase price of the land","es":""},"value":700000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Estimated restoration costs, included in cost","es":""},"value":160000,"unit":"EUR"}],"result":860000,"unit":"EUR","rationale":{"fr":"","en":"Approach: 1) cost includes the initial estimate of restoration costs (IAS 16, para. 16): 700,000 + 160,000 = 860,000","es":""}},{"step":"S2","meaning":{"fr":"","en":"Annual charge","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Estimated restoration costs, included in cost","es":""},"value":160000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Operating period (benefits)","es":""},"value":8,"unit":"YEARS"}],"result":20000,"unit":"EUR","rationale":{"fr":"","en":"however, the restoration costs included in its cost are depreciated over the period of the benefits (IAS 16, para. 59): 160,000 ÷ 8 = 20,000 a year, straight line as a teaching assumption.","es":""}}],"rationale":{"fr":"","en":"land is not depreciated, but restoration costs forming part of its cost are, over the period of the benefits.","es":""},"references":["REF.IAS16.16","REF.IAS16.58","REF.IAS16.59"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000149","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.LAND_AND_BUILDINGS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"HOSPITALITY","tested_point":"BUILDING_DEPRECIATION_ENTRY","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"entry"},"references":["IAS 16 §48","IAS 16 §58"],"exercise":{"prompt":{"fr":"","en":"Use the hotel: building EUR 3,000,000, residual value EUR 300,000, 30 years; land EUR 1,500,000. Record the year's depreciation entry; the debit line is given.","es":""},"explanation":{"fr":"","en":"Approach: 1) the building's charge = (3,000,000 − 300,000) ÷ 30 = 90,000; 2) it is recognised in profit or loss (IAS 16, para. 48): debit depreciation expense; 3) the counterpart is a credit to the building's accumulated depreciation, not to the cost account; 4) nothing for the land, which is not depreciated (IAS 16, para. 58). Check: debit 90,000 = credit 90,000. Main trap: crediting the building's cost account directly, or depreciating part of the land. Rule to remember: charge to expenses, with the counterpart in the building's accumulated depreciation; land is generally not depreciated (IAS 16, para. 58).","es":""},"common_error":{"fr":"","en":"Crediting the building cost account directly, or depreciating part of the land.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"DEPRECIATION_EXPENSE","text":{"fr":"","en":"Depreciation expense (profit or loss)","es":""}},{"id":"ACC_DEP_BUILDINGS","text":{"fr":"","en":"Accumulated depreciation — buildings","es":""}},{"id":"ACC_DEP_LAND","text":{"fr":"","en":"Accumulated depreciation — land","es":""}},{"id":"BUILDINGS","text":{"fr":"","en":"Buildings (cost)","es":""}}],"lines":[{"id":"L1","account":"DEPRECIATION_EXPENSE","side":"DEBIT","amount":90000,"given":["account","side"]},{"id":"L2","account":"ACC_DEP_BUILDINGS","side":"CREDIT","amount":90000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000150","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.USEFUL_LIFE"],"dimension":"PROFESSIONAL_JUDGMENT","format":"SINGLE_CHOICE","context":"TELECOM","tested_point":"USEFUL_LIFE_OBSOLESCENCE_AND_RENEWAL_POLICY","difficulty":"EXPERT","estimated_time_s":120,"lesson_id":"LS.IAS16.000012","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"judgment"},"references":["IAS 16 §56","IAS 16 §57"],"exercise":{"prompt":{"fr":"","en":"An operator rolls out radio antennas. Case data: physical life 12 years; spectrum licence valid for 15 years; approved strategic plan providing for full replacement by the next generation in 7 years, consistent with the two previous renewals. Which useful life is best supported?","es":""},"explanation":{"fr":"","en":"Useful life takes account of technical obsolescence and legal limits (IAS 16, para. 56) and is measured by the utility expected by the entity, which may be shorter than economic life (IAS 16, para. 57). The approved plan and past practice support 7 years. Professional judgement: the conclusion rests on these elements; it is prudent to document it and review it at each year-end (IAS 16, para. 51). Rule to remember: useful life reflects the utility expected by the entity, not physical life or the legal limit. Effect on the financial statements: a life of 12 or 15 years would spread cost more slowly and overstate profit and carrying amount in each period.","es":""},"common_error":{"fr":"","en":"Using the physical life or the licence term instead of the utility expected by the entity, given obsolescence and its renewal policy.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"15 years: the licence is the legal limit","es":""},"correct":false,"feedback":{"fr":"","en":"This answer takes the legal limit for the useful life. The 15-year licence is one factor among others, alongside technical obsolescence (IAS 16, para. 56), and useful life is measured by the utility expected by the entity, which may be shorter than economic life (IAS 16, para. 57). The approved strategic plan, consistent with two earlier renewals, provides for replacement in 7 years: the entity will not use the antennas until year 15. Rule to remember: a legal limit is one factor among others in useful life (IAS 16, para. 56).","es":""}},{"id":"B","text":{"fr":"","en":"12 years: the physical life","es":""},"correct":false,"feedback":{"fr":"","en":"This answer considers only physical wear. Useful life also takes account of technical or commercial obsolescence and legal limits (IAS 16, para. 56), and corresponds to the utility expected by the entity (IAS 16, para. 57). Here the approved replacement plan at 7 years, confirmed by the two previous cycles, shortens the life well below the 12 years of physical life. Rule to remember: physical life is not useful life, which reflects the utility expected by the entity (IAS 16, para. 57).","es":""}},{"id":"C","text":{"fr":"","en":"7 years: technical obsolescence and renewal policy","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000151","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.METHODS"],"dimension":"CALCULATION","format":"CALCULATION","context":"PRINTING","tested_point":"THREE_METHODS_FIRST_YEAR","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"numeric-methods"},"references":["IAS 16 §60","IAS 16 §62"],"exercise":{"prompt":{"fr":"","en":"A printer acquires a rotary press, available on 1 January N. Calculate the charge for N under each of the three methods (teaching assumptions for diminishing balance: 50% rate applied to the opening carrying amount).","es":""},"explanation":{"fr":"","en":"Approach: 1) straight line: (200,000 − 20,000) ÷ 4 = 45,000; 2) diminishing balance: the 50% rate applies to the opening carrying amount, 200,000 × 50% = 100,000; 3) units of production: depreciable amount × share of production, 180,000 × 300,000 ÷ 900,000 = 60,000. Three methods are allowed (IAS 16, para. 62); the choice depends on the expected pattern of consumption (IAS 16, para. 60). Case convention: the 50% diminishing-balance rate is a teaching assumption. Main trap: applying the 50% rate to the depreciable amount (90,000) instead of the carrying amount. Rule to remember: straight line and units of production start from the depreciable amount; the method chosen must reflect the expected pattern of consumption (IAS 16, para. 60).","es":""},"common_error":{"fr":"","en":"Applying the 50% rate to the depreciable amount (90,000) instead of the carrying amount.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost","es":""},"value":"200000","unit":"EUR"},{"label":{"fr":"","en":"Residual value","es":""},"value":"20000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"4","unit":"YEARS"},{"label":{"fr":"","en":"Total expected output (copies)","es":""},"value":"900000","unit":"UNITS"},{"label":{"fr":"","en":"Output in N","es":""},"value":"300000","unit":"UNITS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Straight-line charge","es":""},"answer":45000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Diminishing balance charge","es":""},"answer":100000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Units of production charge","es":""},"answer":60000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Straight-line charge","es":""},"expression":"(a - b) / c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":200000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Residual value","es":""},"value":20000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Useful life","es":""},"value":4,"unit":"YEARS"}],"result":45000,"unit":"EUR"}],"rationale":{"fr":"","en":"straight line and units of production start from the depreciable amount; the method chosen must reflect the expected pattern of consumption (IAS 16, para. 60).","es":""},"references":["REF.IAS16.60","REF.IAS16.62"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000152","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.METHODS"],"dimension":"CALCULATION","format":"CALCULATION","context":"CONSTRUCTION","tested_point":"DIMINISHING_BALANCE_FLOOR_AT_RESIDUAL_VALUE","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"numeric-methods"},"references":["IAS 16 §53","IAS 16 §62"],"exercise":{"prompt":{"fr":"","en":"A construction machine is depreciated using the diminishing balance method. Teaching assumptions: 40% rate on the opening carrying amount; the final year brings the carrying amount down to the residual value. Calculate.","es":""},"explanation":{"fr":"","en":"Approach: year 1: 100,000 × 40% = 40,000 (carrying amount 60,000); year 2: 60,000 × 40% = 24,000 (carrying amount 36,000); year 3: 36,000 × 40% = 14,400 (carrying amount 21,600); year 4: bring the carrying amount down to the residual value, 21,600 − 10,000 = 11,600. Check: 40,000 + 24,000 + 14,400 + 11,600 = 90,000 = depreciable amount (IAS 16, para. 53); diminishing balance is an accepted method (IAS 16, para. 62). Main trap: applying 40% in year 4 (8,640) and ending with a carrying amount of 12,960, above the residual value. Rule to remember: total charges equal cost less residual value; the last year clears the remaining difference.","es":""},"common_error":{"fr":"","en":"Applying 40% in year 4 (8,640) and ending with a carrying amount of 12,960, above the residual value.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost","es":""},"value":"100000","unit":"EUR"},{"label":{"fr":"","en":"Residual value","es":""},"value":"10000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"4","unit":"YEARS"},{"label":{"fr":"","en":"Rate","es":""},"value":"40","unit":"PERCENT"}],"steps":[{"id":"S1","label":{"fr":"","en":"Charge for year 2","es":""},"answer":24000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Carrying amount at the end of year 3","es":""},"answer":21600,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Charge for year 4","es":""},"answer":11600,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S3","meaning":{"fr":"","en":"Charge for year 4","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount at the end of year 3","es":""},"value":21600,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Residual value","es":""},"value":10000,"unit":"EUR"}],"result":11600,"unit":"EUR"}],"rationale":{"fr":"","en":"total charges equal cost less residual value; the last year clears the remaining difference.","es":""},"references":["REF.IAS16.53","REF.IAS16.62"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000153","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.METHODS"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"AVIATION","tested_point":"METHOD_REFLECTS_PATTERN_OF_CONSUMPTION","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"methods"},"references":["IAS 16 §60","IAS 16 §62","IAS 16 §62A"],"exercise":{"prompt":{"fr":"","en":"Case data: an aircraft engine wears according to flight hours; the airline's flight schedule varies widely from one year to the next (from 1,200 to 3,000 hours). Which method best reflects the expected pattern of consumption?","es":""},"explanation":{"fr":"","en":"The method must reflect the expected pattern of consumption of benefits (IAS 16, para. 60); with wear linked to flight hours, units of production reflects it best (IAS 16, para. 62). A judgement on the case data.","es":""},"common_error":{"fr":"","en":"Choosing revenue as the depreciation base because it \"follows activity\", or applying straight line by default without looking at the pattern of wear.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Straight-line over the useful life","es":""},"correct":false,"feedback":{"fr":"","en":"Straight line is an accepted method, but it assumes even consumption. The method must reflect the expected pattern of consumption of the benefits (IAS 16, para. 60): here the engine wears according to flight hours, which range from 1,200 to 3,000 from one year to the next. A constant charge would be the same for 1,200 hours as for 3,000, whereas units of production follow actual usage (IAS 16, para. 62). Rule to remember: choose the method that follows the pattern of consumption, not the simplest one.","es":""}},{"id":"B","text":{"fr":"","en":"Units of production based on flight hours","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Based on the revenue of the flights made with that engine","es":""},"correct":false,"feedback":{"fr":"","en":"A method based on the revenue generated by an activity that uses the asset is not appropriate (IAS 16, para. 62A). The revenue from flights also depends on prices, load factors and economic conditions, whereas engine wear depends on flight hours. The suitable method is units of production based on those hours (IAS 16, paras. 60 and 62). Rule to remember: depreciation is measured on the physical consumption of the asset, not on the revenue of the activity (IAS 16, para. 62A).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000154","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.REVENUE_BASED_METHODS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"LEISURE","tested_point":"REVENUE_BASED_METHOD_NOT_APPROPRIATE","difficulty":"INTERMEDIATE","estimated_time_s":30,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"revenue-based"},"references":["IAS 16 §62A"],"exercise":{"prompt":{"fr":"","en":"An amusement park may depreciate a ride in proportion to the ticket revenue it generates, since that revenue tracks attendance.","es":""},"explanation":{"fr":"","en":"False. Reasoning: a depreciation method must reflect the consumption of the asset's benefits; yet a method based on the revenue generated by an activity that uses the asset is not appropriate (IAS 16, para. 62A). Ticket revenue also depends on prices, discounts and inflation, not only on attendance. Main trap: confusing a measure of physical use (cycles, operating hours) with the revenue of the activity. Rule to remember: an attraction may be depreciated on its physical use; a revenue-based method is not appropriate (IAS 16, para. 62A).","es":""},"common_error":{"fr":"","en":"Confusing a measure of physical use (cycles, hours) with revenue from the activity.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000155","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.CESSATION"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"FOOD","tested_point":"CESSATION_IFRS5_OR_DERECOGNITION_NOT_IDLENESS","difficulty":"ADVANCED","estimated_time_s":120,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"start-and-cessation"},"references":["IAS 16 §55"],"exercise":{"prompt":{"fr":"","en":"A food manufacturer drafts its year-end memo on depreciation. Spot the erroneous statements.","es":""},"explanation":{"fr":"","en":"Steps: for each statement, ask whether depreciation has a reason to stop: classification as held for sale, derecognition, a fully depreciated asset or a usage-based method. Depreciation ceases at the earlier of two dates: classification under IFRS 5 or derecognition; it does not cease during inactivity, unless the asset is fully depreciated, but a usage-based method may give a zero charge (IAS 16, para. 55). Trap: stopping depreciation because the asset is idle or a sale is being discussed. Rule to remember: depreciation ceases at classification under IFRS 5 or at derecognition, whichever comes first (IAS 16, para. 55). Effect on the financial statements: wrongly stopping depreciation of the warehouse would understate expenses and overstate its carrying amount.","es":""},"common_error":{"fr":"","en":"Stopping depreciation because the asset is idle or a sale is being discussed, when only IFRS 5 classification and derecognition end it.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The packaging line (straight-line), idle for 4 months for lack of orders, was not depreciated during the shutdown.","es":""},"erroneous":true,"correction":{"fr":"","en":"Depreciation does not cease during idle periods; under straight-line, the charge continues (IAS 16, para. 55).","es":""}},{"id":"S2","text":{"fr":"","en":"The oven depreciated based on baking hours bore no charge during the 2 months it did not operate.","es":""},"erroneous":false},{"id":"S3","text":{"fr":"","en":"The warehouse's depreciation was stopped as soon as the board mentioned a possible sale, without classification as held for sale.","es":""},"erroneous":true,"correction":{"fr":"","en":"Depreciation ceases on classification as held for sale (IFRS 5) or on derecognition, whichever is earlier (IAS 16, para. 55).","es":""}},{"id":"S4","text":{"fr":"","en":"A fully depreciated filling machine, still in use, bears no further charge.","es":""},"erroneous":false}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000156","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.START_DATE"],"dimension":"CALCULATION","format":"FILL_BLANK","context":"PHARMA","tested_point":"START_WHEN_AVAILABLE_FOR_USE_PRO_RATA","difficulty":"BEGINNER","estimated_time_s":75,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"start-and-cessation"},"references":["IAS 16 §55"],"exercise":{"prompt":{"fr":"","en":"Complete.","es":""},"explanation":{"fr":"","en":"Approach: 1) the start date is when the asset is available for use (IAS 16, para. 55): installed, qualified and ready to operate on 1 May, not on delivery on 10 March nor at the first batch on 1 August; 2) annual charge = 240,000 ÷ 10 = 24,000; 3) from 1 May to 31 December: 8 months, i.e. 24,000 × 8/12 = 16,000. Main trap: starting from delivery or from the first commercial production. Rule to remember: depreciation starts when the asset is ready for use, even if it is not yet producing; the first year is pro-rated.","es":""},"common_error":{"fr":"","en":"Starting depreciation on delivery or at the first commercial batch instead of the date the asset is available for use.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"A laboratory receives a freeze dryer on 10 March N (cost EUR 240,000, no residual value, 10 years, straight-line). It is installed, qualified and ready to operate on 1 May N; the first commercial batch is produced on 1 August N. Year-end 31 December. Depreciation begins on {{date}}; charge for N: EUR {{charge}}.","es":""},"blanks":[{"id":"date","mode":"CHOICE","choices":[{"id":"MARCH_10","text":{"fr":"","en":"10 March N","es":""}},{"id":"MAY_1","text":{"fr":"","en":"1 May N","es":""}},{"id":"AUG_1","text":{"fr":"","en":"1 August N","es":""}}],"answer":"MAY_1"},{"id":"charge","mode":"NUMBER","answer":16000,"tolerance":0}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000157","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.ANNUAL_REVIEW"],"dimension":"CALCULATION","format":"CALCULATION","context":"ENERGY","tested_point":"PROSPECTIVE_REVISION_LIFE_AND_RESIDUAL_VALUE","difficulty":"ADVANCED","estimated_time_s":120,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"numeric-revision"},"references":["IAS 16 §51"],"exercise":{"prompt":{"fr":"","en":"A turbine costs EUR 600,000 on 1 January N; residual value EUR 60,000; life 12 years; straight-line. On 1 January N+4 (teaching assumption on the effective date), the remaining life is extended to 10 years and the residual value reduced to EUR 40,000. Calculate.","es":""},"explanation":{"fr":"","en":"Approach: 1) initial charge (600,000 − 60,000) ÷ 12 = 45,000; carrying amount at 1/1/N+4 = 600,000 − 4 × 45,000 = 420,000; 2) the revision of life and residual value is a change in estimate (IAS 16, para. 51): the carrying amount, less the new residual value, is depreciated over the remaining life, i.e. (420,000 − 40,000) ÷ 10 = 38,000 a year; 3) N to N+3 are not restated. Main trap: recalculating from inception, (600,000 − 40,000) ÷ 14 = 40,000, as if the new estimate had always existed. Rule to remember: a change in estimate applies prospectively, from the carrying amount at that date.","es":""},"common_error":{"fr":"","en":"Recalculating from inception ((600,000 − 40,000) ÷ 14 = 40,000) as if the new estimate had always applied.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost","es":""},"value":"600000","unit":"EUR"},{"label":{"fr":"","en":"Initial residual value","es":""},"value":"60000","unit":"EUR"},{"label":{"fr":"","en":"Initial life","es":""},"value":"12","unit":"YEARS"},{"label":{"fr":"","en":"New residual value","es":""},"value":"40000","unit":"EUR"},{"label":{"fr":"","en":"New remaining life","es":""},"value":"10","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Carrying amount at 1/1/N+4","es":""},"answer":420000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"New annual charge","es":""},"answer":38000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Carrying amount at 1/1/N+4","es":""},"expression":"a - 4 * ((a - b) / c)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":600000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Initial residual value","es":""},"value":60000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Initial life","es":""},"value":12,"unit":"YEARS"}],"result":420000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"New annual charge","es":""},"expression":"(a - b) / c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount at 1/1/N+4","es":""},"value":420000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"New residual value","es":""},"value":40000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"New remaining life","es":""},"value":10,"unit":"YEARS"}],"result":38000,"unit":"EUR","rationale":{"fr":"","en":"the revision of life and residual value is a change in estimate (IAS 16, para. 51): the carrying amount, less the new residual value, is depreciated over the remaining life, i.e. (420,000 − 40,000) ÷ 10 = 38,000 a year","es":""}}],"rationale":{"fr":"","en":"a change in estimate applies prospectively, from the carrying amount at that date.","es":""},"references":["REF.IAS16.51"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000158","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.ANNUAL_REVIEW","IAS16.DEPRECIATION.METHODS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"ENERGY","tested_point":"NO_CATCH_UP_ENTRY_ON_REVISION","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"entry"},"references":["IAS 16 §48","IAS 16 §51"],"exercise":{"prompt":{"fr":"","en":"Use the turbine revised on 1 January N+4 (new charge: EUR 38,000 a year). Record the entry for year N+4.","es":""},"explanation":{"fr":"","en":"Approach: 1) the revision affects the period of the change and later periods (IAS 16, para. 51): past years are not corrected; 2) the N+4 charge is the new charge, 38,000, debited to profit or loss (IAS 16, para. 48); 3) the counterpart is a credit to the plant's accumulated depreciation. No adjustment to retained earnings or to past accumulated depreciation. Check: debit 38,000 = credit 38,000. Main trap: posting a catch-up entry to retained earnings for depreciation over- or under-recognised. Rule to remember: a change in estimate produces only a new charge, with no catch-up entry.","es":""},"common_error":{"fr":"","en":"Recording a catch-up entry in retained earnings for past excess depreciation.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"DEPRECIATION_EXPENSE","text":{"fr":"","en":"Depreciation expense (profit or loss)","es":""}},{"id":"ACC_DEP_PLANT","text":{"fr":"","en":"Accumulated depreciation — plant and machinery","es":""}},{"id":"RETAINED_EARNINGS","text":{"fr":"","en":"Retained earnings (opening)","es":""}},{"id":"PLANT","text":{"fr":"","en":"Plant and machinery (cost)","es":""}}],"lines":[{"id":"L1","account":"DEPRECIATION_EXPENSE","side":"DEBIT","amount":38000},{"id":"L2","account":"ACC_DEP_PLANT","side":"CREDIT","amount":38000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000159","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.ANNUAL_REVIEW"],"dimension":"RECOGNITION","format":"MULTIPLE_CHOICE","context":"GENERIC","tested_point":"CHANGES_IN_ESTIMATE_IDENTIFIED","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"annual-review"},"references":["IAS 16 §51","IAS 16 §61","IAS 8 §5","IAS 8 §34"],"exercise":{"prompt":{"fr":"","en":"Which of these changes does IAS 16 classify as changes in accounting estimate? (Several answers possible.)","es":""},"explanation":{"fr":"","en":"Approach: for each change, ask whether it results from new information or a new fact (IAS 8, para. 34). Lengthening of useful life after a technical review (A), a fall in residual value linked to the second-hand market (B) and a change of method when the pattern of use changes significantly (C) are changes in estimate: residual value and useful life are reviewed at least at each year-end (IAS 16, para. 51), and so is the method (IAS 16, para. 61), under IAS 8. Correcting a prior-year charge calculated on a wrongly entered cost when the invoice was available (D) is an error: it comes from the misuse of available information (IAS 8, para. 5). Main trap: labelling every correction an estimate. Rule to remember: revision of life, residual value or method = change in estimate (IAS 16, paras. 51 and 61); available information misused = error (IAS 8, para. 5).","es":""},"common_error":{"fr":"","en":"Calling the correction of an input error a change in estimate, or believing that revising life or residual value requires restating past years.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Extending the useful life after a technical review","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Lower residual value due to the second-hand market","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Switch from straight-line to units of production after a significant change in the pattern of use","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"Correcting a charge for N−1 calculated on a mis-keyed cost when the invoice was available","es":""},"correct":false,"feedback":{"fr":"","en":"Revisions of useful life, residual value and depreciation method are changes in accounting estimate under IAS 8 (IAS 16, paras. 51 and 61). Under IAS 8, an estimate may be changed as a result of new information without that correcting an error (IAS 8, para. 34), whereas an error arises from the misuse of reliable information that was available (IAS 8, para. 5). Here, the invoice was available: the cost was entered wrongly, so it is an error. Rule to remember: new information justifies a change in estimate; available information that was misused is an error (IAS 8, paras. 5 and 34).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000160","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.START_DATE","IAS16.DEPRECIATION.CESSATION"],"dimension":"RULE_KNOWLEDGE","format":"ORDERING","context":"GENERIC","tested_point":"DEPRECIATION_LIFECYCLE","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"start-and-cessation"},"references":["IAS 16 §55"],"exercise":{"prompt":{"fr":"","en":"Put the life of a machine, and what happens to its depreciation, in chronological order.","es":""},"explanation":{"fr":"","en":"Reason chronologically. On delivery (S1) the asset is not yet ready: costs are added to its cost, with no depreciation. As soon as it is available for use (S2), depreciation starts (IAS 16, para. 55). A temporary stoppage (S3) does not interrupt straight-line depreciation (IAS 16, para. 55). It ceases at the earlier of two dates: classification as held for sale under IFRS 5 (S4) or derecognition (S5). Main trap: confusing idleness with the end of depreciation. This order is the chronology of the case, not a sequence imposed by the standard. Rule to remember: depreciation runs from availability until IFRS 5 classification or derecognition, with no pause for idleness.","es":""},"common_error":{"fr":"","en":"Stopping depreciation as soon as production temporarily stops, or starting it on delivery.","es":""},"format":"ORDERING","steps":[{"id":"S1","text":{"fr":"","en":"Delivery: costs added to cost, no charge yet","es":""}},{"id":"S2","text":{"fr":"","en":"Machine available for use: depreciation begins","es":""}},{"id":"S3","text":{"fr":"","en":"Temporary production stop: straight-line depreciation continues","es":""}},{"id":"S4","text":{"fr":"","en":"Classification as held for sale (IFRS 5): depreciation ceases","es":""}},{"id":"S5","text":{"fr":"","en":"Sale: the machine is derecognised","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000161","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.METHODS"],"dimension":"APPLICATION","format":"MATCHING","context":"MINING","tested_point":"MATCH_ASSET_TO_REPRESENTATIVE_METHOD","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"example"},"references":["IAS 16 §60","IAS 16 §62","IAS 16 §62A"],"exercise":{"prompt":{"fr":"","en":"Match each asset (case data) with the method that best represents its pattern of consumption. One method offered is never appropriate.","es":""},"explanation":{"fr":"","en":"Approach: for each asset, identify how its benefits are consumed (IAS 16, para. 60). L1, same service every year: even consumption, straight line. L2, wear linked to highly variable tonnes extracted: units of production. L3, strong utility at first then quickly superseded: heavier consumption early on, diminishing balance (IAS 16, para. 62). R4, based on revenue, is not appropriate (IAS 16, para. 62A). These pairings are judgements on the case data. Main trap: matching R4 to the excavator because revenue follows extraction. Rule to remember: the method is chosen on the pattern of consumption of the asset (IAS 16, para. 60); a revenue-based method is not appropriate (IAS 16, para. 62A).","es":""},"common_error":{"fr":"","en":"Choosing revenue as the \"representative\" method of usage, or picking a method by habit rather than by the expected pattern of consumption.","es":""},"format":"MATCHING","left":[{"id":"L1","text":{"fr":"","en":"Office furniture, same service every year","es":""}},{"id":"L2","text":{"fr":"","en":"Mining excavator, wear linked to tonnes extracted, which vary widely","es":""}},{"id":"L3","text":{"fr":"","en":"Computing servers, high utility at first then quickly outdated","es":""}}],"right":[{"id":"R1","text":{"fr":"","en":"Straight-line","es":""}},{"id":"R2","text":{"fr":"","en":"Units of production","es":""}},{"id":"R3","text":{"fr":"","en":"Diminishing balance","es":""}},{"id":"R4","text":{"fr":"","en":"Revenue-based","es":""}}],"pairs":[{"left":"L1","right":"R1"},{"left":"L2","right":"R2"},{"left":"L3","right":"R3"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000162","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.ANNUAL_REVIEW","IAS16.DEPRECIATION.METHODS"],"dimension":"ANALYSIS","format":"MINI_CASE","context":"AUTOMOTIVE","tested_point":"METHOD_CHANGE_PROSPECTIVE","difficulty":"EXPERT","estimated_time_s":180,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"annual-review"},"references":["IAS 16 §61","IAS 16 §62","IAS 16 §76","IAS 8 §36"],"exercise":{"prompt":{"fr":"","en":"Analyse the change of method and its effects.","es":""},"explanation":{"fr":"","en":"Three-step approach. 1) Classification: the method is reviewed at each year-end and changed if the pattern of consumption changes significantly; it is a change in estimate, not an error (IAS 16, para. 61). 2) Calculation: straight-line charge (500,000 − 20,000) ÷ 8 = 60,000; carrying amount at 1/1/N+2 = 500,000 − 2 × 60,000 = 380,000; rate per piece (380,000 − 20,000) ÷ 900,000 = EUR 0.40; N+2 charge = 200,000 × 0.40 = 80,000 (IAS 16, para. 62). 3) Presentation: prospective application, without restating N+1, with disclosure of the nature and effect of the change (IAS 16, paras. 61 and 76). Main trap: recalculating from inception. Rule to remember: a change of method is a change in estimate, applied from the existing carrying amount and for the future only.","es":""},"common_error":{"fr":"","en":"Restating prior years, or recalculating from inception, by treating the change of method as the correction of an error.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"An automotive supplier depreciates a press (cost EUR 500,000, residual value EUR 20,000) on a straight-line basis over 8 years from 1 January N. At the end of N+1, a new customer contract makes production very irregular; management concludes that the pattern of consumption has changed significantly and switches, on 1 January N+2, to units of production. Remaining expected output: 900,000 parts; output in N+2: 200,000 parts.","es":""},"parts":[{"prompt":{"fr":"","en":"How should this change of method be classified?","es":""},"explanation":{"fr":"","en":"Approach: ask whether a new fact has changed the pattern of consumption. The method is reviewed at each year-end and changed if the expected pattern changes significantly; that is a change in estimate (IAS 16, para. 61). Rule to remember: a significant change in the pattern of consumption leads to a change in estimate of the method (IAS 16, para. 61).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Change in accounting estimate","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Correction of an error","es":""},"correct":false,"feedback":{"fr":"","en":"Straight-line reflected the expected pattern of consumption at the time: nothing was wrong at the outset. The method is reviewed at each year-end and changed if the expected pattern changes significantly; that is then a change in estimate, not the correction of an error (IAS 16, para. 61). Rule to remember: a change of method driven by a new fact is a change in estimate (IAS 16, para. 61).","es":""}}],"id":"P1","dimension":"RULE_KNOWLEDGE"},{"prompt":{"fr":"","en":"Calculate the carrying amount at 1 January N+2 and the charge for N+2.","es":""},"explanation":{"fr":"","en":"Approach: first calculate the carrying amount at 1/1/N+2, then the rate per unit. (500,000 − 20,000) ÷ 8 = 60,000; carrying amount = 500,000 − 2 × 60,000 = 380,000. Units of production on the balance: (380,000 − 20,000) ÷ 900,000 = EUR 0.40 per unit; 200,000 × 0.40 = 80,000 (IAS 16, para. 62). Trap: recalculating on the original cost. Rule to remember: the new method applies to the existing carrying amount, less residual value, over the remaining output (IAS 16, paras. 61 and 62).","es":""},"common_error":{"fr":"","en":"Recomputing depreciation on original cost: the new method applies to the existing carrying amount, less residual value, over the remaining output.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Annual straight-line charge (N and N+1)","es":""},"value":"60000","unit":"EUR"},{"label":{"fr":"","en":"Remaining expected output","es":""},"value":"900000","unit":"UNITS"},{"label":{"fr":"","en":"Output in N+2","es":""},"value":"200000","unit":"UNITS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Carrying amount at 1/1/N+2","es":""},"answer":380000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Charge for N+2","es":""},"answer":80000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Carrying amount at 1/1/N+2","es":""},"expression":"a - 2 * b","variables":[{"symbol":"a","meaning":{"fr":"","en":"cost EUR 500,000","es":""},"value":500000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Annual straight-line charge (N and N+1)","es":""},"value":60000,"unit":"EUR"}],"result":380000,"unit":"EUR"}],"rationale":{"fr":"","en":"the new method applies to the existing carrying amount, less residual value, over the remaining output (IAS 16, paras. 61 and 62).","es":""},"references":["REF.IAS16.61","REF.IAS16.62"]}},{"prompt":{"fr":"","en":"The N+2 financial statements must restate the comparative N+1 charges under the new method.","es":""},"explanation":{"fr":"","en":"False. Approach: ask whether the change is a change in estimate. A change in estimate is accounted for prospectively (IAS 8, para. 36); the entity discloses the nature and effect of the change on the period and subsequent periods (IAS 16, paras. 61 and 76). Trap: restating the N+1 comparatives. Rule to remember: a change in estimate applies for the future, without restating comparative periods (IAS 8, para. 36); (IAS 16, paras. 61 and 76).","es":""},"common_error":{"fr":"","en":"Restating comparatives: a change in depreciation method is a change in estimate, applied prospectively.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P3","dimension":"DOCUMENTATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000163","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.REVENUE_BASED_METHODS","IAS16.DEPRECIATION.METHODS"],"dimension":"PROFESSIONAL_JUDGMENT","format":"SINGLE_CHOICE","context":"HOSPITALITY","tested_point":"USAGE_MEASURE_VERSUS_REVENUE","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"revenue-based"},"references":["IAS 16 §60","IAS 16 §62","IAS 16 §62A"],"exercise":{"prompt":{"fr":"","en":"A car wash operator proposes depreciating its wash gantries in proportion to each station's revenue, 'because revenue follows use'. Which answer is most accurate?","es":""},"explanation":{"fr":"","en":"A revenue-based method is not appropriate (IAS 16, para. 62A): revenue includes prices and promotions. A measure of physical use is a units of production method (IAS 16, para. 62), to be used if it reflects the expected pattern (IAS 16, para. 60). Effect on the financial statements: depreciation based on revenue would make the charge vary with prices and promotions, not with the consumption of the asset.","es":""},"common_error":{"fr":"","en":"Thinking that the correlation between revenue and usage is enough to justify depreciating in proportion to revenue.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Acceptable, since revenue is correlated with use","es":""},"correct":false,"feedback":{"fr":"","en":"Correlation with usage is not enough: a method based on the revenue generated by an activity that uses the asset is not appropriate (IAS 16, para. 62A). Revenue also reflects prices and promotions, which have no link with wear of the gantries. A measure of physical use, such as the number of wash cycles, falls under units of production (IAS 16, para. 62). Rule to remember: a statistical link with usage does not make a revenue-based method acceptable.","es":""}},{"id":"B","text":{"fr":"","en":"Not appropriate; a method based on the number of wash cycles may be used if it reflects the pattern of consumption","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Not appropriate; only straight-line is permitted by IAS 16","es":""},"correct":false,"feedback":{"fr":"","en":"IAS 16 does not impose straight line: it allows several methods, including straight line, diminishing balance and units of production (IAS 16, para. 62), to be chosen according to the expected pattern of consumption (IAS 16, para. 60). The proposed method is ruled out not because it is not straight line, but because it is based on revenue (IAS 16, para. 62A). Rule to remember: several methods are allowed; one based on revenue is not.","es":""}},{"id":"D","text":{"fr":"","en":"Acceptable if the method is described in the notes","es":""},"correct":false,"feedback":{"fr":"","en":"Describing the method in the notes does not make it appropriate: the exclusion of a revenue-based method (IAS 16, para. 62A) applies whatever disclosure is given. Disclosing the depreciation method helps users assess management's choices (IAS 16, para. 75); it accompanies an appropriate choice and does not validate an excluded one. Rule to remember: disclosure in the notes does not replace compliance of the method.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000164","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.ANNUAL_REVIEW"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"ANNUAL_REVIEW_REQUIRED","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"annual-review"},"references":["IAS 16 §51","IAS 16 §61"],"exercise":{"prompt":{"fr":"","en":"Once set at acquisition, the useful life, residual value and depreciation method of an item of property, plant and equipment can no longer be changed.","es":""},"explanation":{"fr":"","en":"False. Reasoning: residual value and useful life are reviewed at least at each year-end (IAS 16, para. 51); the depreciation method is too, and must be changed if the expected pattern of consumption changes significantly (IAS 16, para. 61). These changes are changes in estimate under IAS 8, applied for the future. Main trap: believing that the initial depreciation schedule stays valid to the end. Rule to remember: life, residual value and method are reviewed at least annually and changed if expectations change.","es":""},"common_error":{"fr":"","en":"Treating useful life, residual value and method as fixed at acquisition.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000165","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.IAS36_LINK"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"GENERIC","tested_point":"IMPAIRMENT_BY_REFERENCE_TO_IAS36","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"ias36-link"},"references":["IAS 16 §63"],"exercise":{"prompt":{"fr":"","en":"To determine whether an item of property, plant and equipment measured at cost is impaired, the entity applies IAS 36.","es":""},"explanation":{"fr":"","en":"True. Reasoning: IAS 16 governs measurement and depreciation of the asset, but to determine whether it is impaired it refers to IAS 36 (IAS 16, para. 63). IAS 36 requires an assessment at each reporting date of whether there is an indication of impairment and, if so, an estimate of the recoverable amount (IAS 36, para. 9). Main trap: thinking that IAS 16's cost model contains its own impairment test. Rule to remember: depreciation comes under IAS 16, the impairment test under IAS 36.","es":""},"common_error":{"fr":"","en":"Looking in IAS 16 for the impairment test, when the standard refers to IAS 36.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000166","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.IAS36_LINK"],"dimension":"RECOGNITION","format":"MULTIPLE_CHOICE","context":"MANUFACTURING","tested_point":"IMPAIRMENT_INDICATORS_IN_PPE_FILE","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"ias36-link"},"references":["IAS 16 §63","IAS 36 §9","IAS 36 §12"],"exercise":{"prompt":{"fr":"","en":"At year-end, a manufacturer notes the following facts about its extrusion line (cost model). Which are indications of impairment requiring it to estimate the recoverable amount? (Several answers possible.)","es":""},"explanation":{"fr":"","en":"IAS 16 refers to IAS 36 (IAS 16, para. 63). At each reporting date, the entity looks for indications (IAS 36, para. 9); physical damage, plans to discontinue and worse-than-expected performance are among the internal indications (IAS 36, para. 12).","es":""},"common_error":{"fr":"","en":"Looking for indicators only in external sources (market) and overlooking internal ones (damage, closure plans, reporting).","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"A flood damaged part of the line","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Management approved a plan to shut the line down in 18 months","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Internal reporting shows the line's margin well below budget","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"The market price of an equivalent new line has risen by 8%","es":""},"correct":false,"feedback":{"fr":"","en":"A rise in the price of an equivalent new line is not among the impairment indicators to consider. External indicators include a marked and unexpected fall in market value; internal indicators include physical damage, a plan to discontinue the line and performance worse than expected (IAS 36, para. 12), which correspond to options A, B and C. Rule to remember: look for adverse signals; a favourable market movement is not an indicator.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000167","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.IAS36_LINK"],"dimension":"CALCULATION","format":"CALCULATION","context":"MARITIME","tested_point":"IMPAIRMENT_LOSS_HIGHER_OF_TWO","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"ias36-link"},"references":["IAS 36 §18","IAS 36 §59","IAS 36 §60"],"exercise":{"prompt":{"fr":"","en":"A shipowner (cost model) tests a vessel damaged in a grounding. Calculate the recoverable amount and the impairment loss.","es":""},"explanation":{"fr":"","en":"Approach: 1) recoverable amount is the higher of fair value less costs of disposal (1,880,000) and value in use (1,750,000): 1,880,000 (IAS 36, para. 18); 2) it is below the carrying amount of 2,000,000: the asset is written down to 1,880,000 (IAS 36, para. 59); 3) loss = 2,000,000 − 1,880,000 = 120,000, recognised in profit or loss for an asset carried at cost (IAS 36, para. 60). Main trap: using the lower of the two (1,750,000) and recognising a loss of 250,000. Rule to remember: recoverable amount = the higher of the two amounts; the loss is the excess of carrying amount over that amount.","es":""},"common_error":{"fr":"","en":"Using the lower of the two values (1,750,000) and recognising a loss of 250,000.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Carrying amount","es":""},"value":"2000000","unit":"EUR"},{"label":{"fr":"","en":"Fair value less costs of disposal","es":""},"value":"1880000","unit":"EUR"},{"label":{"fr":"","en":"Value in use","es":""},"value":"1750000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Recoverable amount","es":""},"answer":1880000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Impairment loss","es":""},"answer":120000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S2","meaning":{"fr":"","en":"Impairment loss","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount","es":""},"value":2000000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Fair value less costs of disposal","es":""},"value":1880000,"unit":"EUR"}],"result":120000,"unit":"EUR","rationale":{"fr":"","en":"loss = 2,000,000 − 1,880,000 = 120,000, recognised in profit or loss for an asset carried at cost (IAS 36, para. 60).","es":""}}],"rationale":{"fr":"","en":"recoverable amount = the higher of the two amounts; the loss is the excess of carrying amount over that amount.","es":""},"references":["REF.IAS36.18","REF.IAS36.59","REF.IAS36.60"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000168","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.IAS36_LINK"],"dimension":"CALCULATION","format":"CALCULATION","context":"MARITIME","tested_point":"DEPRECIATION_AFTER_IMPAIRMENT","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"after-impairment"},"references":["IAS 36 §63"],"exercise":{"prompt":{"fr":"","en":"Use the vessel: after the loss, carrying amount EUR 1,880,000; residual value EUR 280,000; remaining life 16 years; straight-line. Before the loss, the carrying amount was EUR 2,000,000. Calculate.","es":""},"explanation":{"fr":"","en":"Approach: 1) after an impairment loss, future depreciation is recalculated on the new carrying amount, less residual value, over the remaining life (IAS 36, para. 63): (1,880,000 − 280,000) ÷ 16 = 100,000; 2) before the loss: (2,000,000 − 280,000) ÷ 16 = 107,500; 3) the reduction is 7,500 a year, and 16 × 7,500 = 120,000, the amount of the loss. Main trap: keeping the old charge, which would depreciate the loss already recognised a second time. Rule to remember: after an impairment loss, the depreciable base is the new carrying amount less residual value, spread over the remaining life.","es":""},"common_error":{"fr":"","en":"Continuing to depreciate on the old carrying amount (EUR 2,000,000), or forgetting to recalculate the charge over the remaining life.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Carrying amount after the loss","es":""},"value":"1880000","unit":"EUR"},{"label":{"fr":"","en":"Carrying amount before the loss","es":""},"value":"2000000","unit":"EUR"},{"label":{"fr":"","en":"Residual value","es":""},"value":"280000","unit":"EUR"},{"label":{"fr":"","en":"Remaining life","es":""},"value":"16","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Annual charge after the loss","es":""},"answer":100000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Reduction in the annual charge","es":""},"answer":7500,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Annual charge after the loss","es":""},"expression":"(a - b) / c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount after the loss","es":""},"value":1880000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Residual value","es":""},"value":280000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Remaining life","es":""},"value":16,"unit":"YEARS"}],"result":100000,"unit":"EUR","rationale":{"fr":"","en":"Approach: 1) after an impairment loss, future depreciation is recalculated on the new carrying amount, less residual value, over the remaining life (IAS 36, para. 63): (1,880,000 − 280,000) ÷ 16 = 100,000","es":""}}],"rationale":{"fr":"","en":"after an impairment loss, the depreciable base is the new carrying amount less residual value, spread over the remaining life.","es":""},"references":["REF.IAS36.63"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000169","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.IAS36_LINK"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"MARITIME","tested_point":"IMPAIRMENT_ENTRY_COST_MODEL","difficulty":"INTERMEDIATE","estimated_time_s":60,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"entry"},"references":["IAS 16 §30","IAS 36 §60"],"exercise":{"prompt":{"fr":"","en":"The vessel (cost model, no revaluation surplus) suffers an impairment loss of EUR 120,000. Record the entry.","es":""},"explanation":{"fr":"","en":"Approach: 1) the asset is at cost with no revaluation surplus: the impairment loss is recognised immediately in profit or loss (IAS 36, para. 60): debit impairment loss, 120,000; 2) the counterpart is a credit to accumulated impairment losses, which reduces the carrying amount (IAS 16, para. 30), not to the cost account nor to a revaluation surplus; 3) any insurance compensation does not belong in this entry, as it is a separate event. Check: debit 120,000 = credit 120,000. Main trap: debiting the revaluation surplus or an insurance receivable. Rule to remember: under the cost model, an impairment loss goes to profit or loss and builds up accumulated impairment losses.","es":""},"common_error":{"fr":"","en":"Debiting the revaluation surplus although the asset is at cost, or debiting an expected insurance receivable.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"IMPAIRMENT_LOSS","text":{"fr":"","en":"Impairment loss (profit or loss)","es":""}},{"id":"ACC_IMPAIRMENT","text":{"fr":"","en":"Accumulated impairment losses — vessels","es":""}},{"id":"REVALUATION_SURPLUS","text":{"fr":"","en":"Revaluation surplus (OCI)","es":""}},{"id":"INSURANCE_RECEIVABLE","text":{"fr":"","en":"Receivable from insurer","es":""}}],"lines":[{"id":"L1","account":"IMPAIRMENT_LOSS","side":"DEBIT","amount":120000},{"id":"L2","account":"ACC_IMPAIRMENT","side":"CREDIT","amount":120000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000170","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.THIRD_PARTY_COMPENSATION"],"dimension":"RULE_KNOWLEDGE","format":"SINGLE_CHOICE","context":"LOGISTICS","tested_point":"COMPENSATION_IN_PL_WHEN_RECEIVABLE","difficulty":"INTERMEDIATE","estimated_time_s":45,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"compensation"},"references":["IAS 16 §65","IAS 16 §66"],"exercise":{"prompt":{"fr":"","en":"A logistics warehouse is destroyed by fire; the entity is insured. How is the insurance compensation recognised?","es":""},"explanation":{"fr":"","en":"Compensation from third parties for items that were impaired, lost or given up goes to profit or loss when it becomes receivable (IAS 16, para. 65); loss, compensation and replacement are separate events (IAS 16, para. 66).","es":""},"common_error":{"fr":"","en":"Offsetting the compensation against the loss or against the cost of the replacement asset, or waiting for cash receipt to recognise it.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Deducted from the loss on the warehouse, from the date of the fire","es":""},"correct":false,"feedback":{"fr":"","en":"This answer offsets loss and compensation from the date of the fire. But compensation is recognised in profit or loss only when it becomes receivable (IAS 16, para. 65), and the loss, the compensation and the replacement are separate events, accounted for separately (IAS 16, para. 66). Example: if the insurer has not yet agreed to pay at the reporting date, no income is recognised. Rule to remember: compensation is not deducted from the loss; it is separate income, recognised when it becomes receivable.","es":""}},{"id":"B","text":{"fr":"","en":"In profit or loss, when it becomes receivable","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"As a reduction of the cost of the replacement warehouse","es":""},"correct":false,"feedback":{"fr":"","en":"This answer mixes compensation and replacement. The acquisition of a replacement asset is a separate event (IAS 16, para. 66): the new warehouse is recognised at its cost, and the compensation does not reduce it. The compensation goes to profit or loss when it becomes receivable (IAS 16, para. 65). Rule to remember: the cost of a replacement does not depend on the compensation.","es":""}},{"id":"D","text":{"fr":"","en":"In profit or loss, only when cash is received","es":""},"correct":false,"feedback":{"fr":"","en":"The test is not cash receipt but whether the compensation has become receivable (IAS 16, para. 65). Waiting for payment would push the income into a period after the right already existed. Example: if the insurer commits in writing in December and pays in February, the income is recognised in December, with a receivable from the insurer. Rule to remember: compensation enters profit or loss as soon as it becomes receivable, without waiting for cash.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000171","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.THIRD_PARTY_COMPENSATION","IAS16.IMPAIRMENT.IAS36_LINK"],"dimension":"APPLICATION","format":"CLASSIFICATION","context":"RETAIL","tested_point":"SEPARATE_EVENTS_CLASSIFIED","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"compensation"},"references":["IAS 16 §63","IAS 16 §65","IAS 16 §66","IAS 16 §67"],"exercise":{"prompt":{"fr":"","en":"A flood hits a shopping centre. Classify each consequence according to the accounting event it relates to.","es":""},"explanation":{"fr":"","en":"Approach: for each consequence, identify which accounting event it triggers. I1 and I5, assets damaged but still in use: an impairment question, tested under IAS 36 (IAS 16, para. 63). I2, irreparable escalators scrapped: no future benefit expected, so derecognition (IAS 16, para. 67). I3, written confirmation from the insurer: the compensation becomes receivable, so profit or loss (IAS 16, para. 65). I4, purchase of new escalators: replacement, recognised at its cost under IAS 16. These events are accounted for separately (IAS 16, para. 66). Main trap: treating everything as a single \"net loss\". Rule to remember: impairment, derecognition, compensation and replacement are four distinct treatments.","es":""},"common_error":{"fr":"","en":"Merging loss, compensation and replacement into one net treatment instead of accounting for them as separate events.","es":""},"format":"CLASSIFICATION","categories":[{"id":"IMPAIRMENT","text":{"fr":"","en":"Impairment (IAS 36 test)","es":""}},{"id":"DERECOGNITION","text":{"fr":"","en":"Derecognition (asset lost)","es":""}},{"id":"COMPENSATION","text":{"fr":"","en":"Compensation (profit or loss when receivable)","es":""}},{"id":"REPLACEMENT","text":{"fr":"","en":"Replacement (cost under IAS 16)","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"The building, flooded, remains usable after works","es":""},"category":"IMPAIRMENT"},{"id":"I2","text":{"fr":"","en":"The escalators, beyond repair, are scrapped","es":""},"category":"DERECOGNITION"},{"id":"I3","text":{"fr":"","en":"The insurer confirms the compensation amount in writing","es":""},"category":"COMPENSATION"},{"id":"I4","text":{"fr":"","en":"New escalators are bought and installed","es":""},"category":"REPLACEMENT"},{"id":"I5","text":{"fr":"","en":"The air-conditioning system, damaged, runs at reduced capacity","es":""},"category":"IMPAIRMENT"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000172","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.THIRD_PARTY_COMPENSATION"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"MANUFACTURING","tested_point":"COMPENSATION_RECEIVABLE_ENTRY","difficulty":"ADVANCED","estimated_time_s":75,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"entry"},"references":["IAS 16 §65","IAS 16 §66"],"exercise":{"prompt":{"fr":"","en":"On 18 December N, the insurer commits in writing to pay EUR 300,000 for a destroyed machine (assumption: the compensation becomes receivable on that date). Payment will be made in February N+1. Record the entry of 18 December N.","es":""},"explanation":{"fr":"","en":"Approach: 1) the compensation becomes receivable on 18 December N, the date of the written commitment (case assumption); it is therefore recognised in profit or loss on that date, without waiting for cash in February N+1 (IAS 16, para. 65); 2) debit the receivable from the insurer, 300,000; credit compensation income, 300,000; 3) this entry is independent of the loss on the machine and of the cost of any replacement (IAS 16, para. 66). Check: debit 300,000 = credit 300,000. Main trap: crediting the impairment loss or the asset, or waiting for cash. Rule to remember: compensation is income recognised as soon as it is receivable, against a receivable.","es":""},"common_error":{"fr":"","en":"Crediting the impairment loss or asset account instead of income, or waiting for the February N+1 receipt.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"INSURANCE_RECEIVABLE","text":{"fr":"","en":"Receivable from insurer","es":""}},{"id":"COMPENSATION_INCOME","text":{"fr":"","en":"Compensation income (profit or loss)","es":""}},{"id":"MACHINERY","text":{"fr":"","en":"Plant and machinery (cost)","es":""}},{"id":"IMPAIRMENT_LOSS","text":{"fr":"","en":"Impairment loss (profit or loss)","es":""}},{"id":"CASH","text":{"fr":"","en":"Cash","es":""}}],"lines":[{"id":"L1","account":"INSURANCE_RECEIVABLE","side":"DEBIT","amount":300000},{"id":"L2","account":"COMPENSATION_INCOME","side":"CREDIT","amount":300000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000173","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.THIRD_PARTY_COMPENSATION"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"FOOD","tested_point":"NO_NETTING_OF_SEPARATE_EVENTS","difficulty":"ADVANCED","estimated_time_s":120,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"compensation"},"references":["IAS 16 §65","IAS 16 §66","IAS 16 §67","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"After a fire on a production line (carrying amount EUR 180,000, no salvageable debris), the accountant proposes the following treatment. Spot the erroneous statements.","es":""},"explanation":{"fr":"","en":"Steps: treat the three events separately, the loss of the asset, the compensation and the replacement. The destroyed line is derecognised, the loss being the net proceeds (nil) less the carrying amount (IAS 16, paras. 67 and 71); the compensation is recognised in profit or loss when it becomes receivable (IAS 16, para. 65); each event, including the acquisition of the replacement asset, is accounted for separately (IAS 16, para. 66). Trap: presenting the loss and the compensation as a single net gain of 120,000, or deducting the excess compensation from the cost of the new line. Rule to remember: the loss, the compensation and the replacement are separate events, accounted for separately (IAS 16, para. 66). Effect on the financial statements: the loss of 180,000 and the compensation of 300,000 each appear in profit or loss, and the new line is carried at its cost of 260,000.","es":""},"common_error":{"fr":"","en":"Presenting loss, compensation and replacement as a single net balance, and deducting the excess compensation from the cost of the new line.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The destroyed line is derecognised; the loss equals its carrying amount, 180,000.","es":""},"erroneous":false},{"id":"S2","text":{"fr":"","en":"The compensation of 300,000, now receivable, is recognised in profit or loss at that date.","es":""},"erroneous":false},{"id":"S3","text":{"fr":"","en":"Loss and compensation are presented in a single entry: a net gain of 120,000.","es":""},"erroneous":true,"correction":{"fr":"","en":"Loss and compensation are separate events, accounted for separately (IAS 16, para. 66).","es":""}},{"id":"S4","text":{"fr":"","en":"The new line, bought for 260,000, is recognised at 140,000, after deducting the excess compensation.","es":""},"erroneous":true,"correction":{"fr":"","en":"The replacement asset is recognised at its cost, 260,000 (IAS 16, para. 66).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000174","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.IAS36_LINK","IAS16.IMPAIRMENT.THIRD_PARTY_COMPENSATION"],"dimension":"ANALYSIS","format":"MINI_CASE","context":"ENERGY","tested_point":"CASUALTY_FULL_TREATMENT","difficulty":"EXPERT","estimated_time_s":240,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"numeric-example"},"references":["IAS 16 §65","IAS 16 §66","IAS 16 §67","IAS 36 §59","IAS 36 §60"],"exercise":{"prompt":{"fr":"","en":"Deal with the casualty at the solar farm.","es":""},"explanation":{"fr":"","en":"Approach in three separate events (IAS 16, para. 66). 1) Destroyed panels: derecognition with a loss equal to carrying amount, 200,000 − 60,000 = 140,000, as there is no disposal proceeds (IAS 16, para. 67). Damaged inverter still in service: impairment test, loss = 300,000 − 210,000 = 90,000 (IAS 36, paras. 59 and 60). Charges for N: 230,000. 2) Compensation: 180,000 as income when it becomes receivable, on 15 December N (IAS 16, para. 65); net effect on N profit or loss: loss of 50,000, with each item accounted for separately. 3) Replacement: new panels at their cost of 240,000 in N+1; the compensation does not reduce it. Main trap: using 60,000 (240,000 − 180,000). Rule to remember: loss, compensation and replacement are three distinct treatments, even though they arise from the same event; compensation is recognised only from the time it is receivable.","es":""},"common_error":{"fr":"","en":"Netting the loss, the compensation and the cost of the new panels into one amount, or deducting the compensation from the replacement cost.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"On 12 August N, a violent hailstorm hits a solar farm (cost model; year-end 31 December). Some panels are destroyed; the inverter station is damaged but keeps running. On 15 December N, the insurer agrees in writing to pay EUR 180,000 (assumption: the compensation becomes receivable on that date). In January N+1, the operator buys new panels for EUR 240,000.","es":""},"exhibits":[{"title":{"fr":"","en":"Data on the assets affected","es":""},"body":{"fr":"","en":"- Destroyed panels: cost 200,000; accumulated depreciation 60,000; no salvageable debris.\n- Inverter station: carrying amount 300,000; recoverable amount estimated under IAS 36: 210,000.","es":""}}],"parts":[{"prompt":{"fr":"","en":"Calculate the effects on profit or loss for N.","es":""},"explanation":{"fr":"","en":"Approach: deal with each event separately. Impairment loss on the inverter unit = 300,000 − 210,000 = 90,000 (IAS 36, paras. 59 and 60). Loss on the destroyed panels = 200,000 − 60,000 = 140,000 (IAS 16, para. 67). Expenses = 230,000; compensation income = 180,000 (IAS 16, para. 65); net effect = loss of 50,000. Rule to remember: the loss of the asset, the compensation and the replacement are accounted for separately (IAS 16, para. 66).","es":""},"common_error":{"fr":"","en":"Netting the compensation against the losses: impairment, loss on destroyed assets and compensation are recognised separately.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Carrying amount of destroyed panels","es":""},"value":"140000","unit":"EUR"},{"label":{"fr":"","en":"Carrying amount of the inverter station","es":""},"value":"300000","unit":"EUR"},{"label":{"fr":"","en":"Recoverable amount of the inverter station","es":""},"value":"210000","unit":"EUR"},{"label":{"fr":"","en":"Compensation receivable","es":""},"value":"180000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Impairment loss on the inverter station","es":""},"answer":90000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Total casualty-related expenses in N","es":""},"answer":230000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Net effect of the casualty on profit or loss for N (loss)","es":""},"answer":50000,"tolerance":0,"unit":"EUR"}],"id":"P1","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Impairment loss on the inverter station","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount of the inverter station","es":""},"value":300000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Recoverable amount of the inverter station","es":""},"value":210000,"unit":"EUR"}],"result":90000,"unit":"EUR"}],"rationale":{"fr":"","en":"the loss of the asset, the compensation and the replacement are accounted for separately (IAS 16, para. 66).","es":""},"references":["REF.IAS16.65","REF.IAS16.66","REF.IAS16.67","REF.IAS36.59","REF.IAS36.60"]}},{"prompt":{"fr":"","en":"At what amount are the new panels recognised in N+1?","es":""},"explanation":{"fr":"","en":"Approach: find the acquisition cost of the new panels, ignoring the casualty. The purchase of replacement assets is a separate event; its cost is determined under IAS 16 (IAS 16, para. 66): 240,000. Trap: deducting the compensation of 180,000. Rule to remember: the replacement asset is recognised at its cost (IAS 16, para. 66).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"EUR 240,000","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"EUR 60,000 (240,000 − 180,000)","es":""},"correct":false,"feedback":{"fr":"","en":"The compensation does not reduce the cost of the replacement: buying the new panels is a separate event from the loss and the compensation (IAS 16, para. 66). Deducting 180,000 from 240,000 mixes these events and understates the asset at 60,000. Rule to remember: the replacement asset is recognised at its own cost, without deducting the compensation (IAS 16, para. 66).","es":""}},{"id":"C","text":{"fr":"","en":"EUR 140,000, the carrying amount of the destroyed panels","es":""},"correct":false,"feedback":{"fr":"","en":"The new asset is a separate purchase, recognised at its own cost of 240,000 (IAS 16, para. 66): the carrying amount of the destroyed panels, 140,000, was derecognised with the loss and is not carried over to the replacement. Rule to remember: the cost of a replacement asset does not depend on the carrying amount of the destroyed asset (IAS 16, para. 66).","es":""}}],"id":"P2","dimension":"APPLICATION"},{"prompt":{"fr":"","en":"Had the insurer only given its agreement in February N+1 (with the compensation not receivable at 31 December N), the entity could nevertheless have reduced the N loss by the expected amount.","es":""},"explanation":{"fr":"","en":"False. Approach: find the date on which the compensation becomes receivable. Compensation is recognised in profit or loss when it becomes receivable (IAS 16, para. 65) and is not offset against the loss (IAS 16, para. 66). Trap: anticipating compensation that is not yet receivable. Rule to remember: compensation that is not receivable at the reporting date is not recognised at that date (IAS 16, para. 65).","es":""},"common_error":{"fr":"","en":"Anticipating compensation not yet receivable: it is only recognised when it becomes receivable.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P3","dimension":"PROFESSIONAL_JUDGMENT"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000175","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.IAS36_LINK","IAS16.IMPAIRMENT.THIRD_PARTY_COMPENSATION"],"dimension":"RULE_KNOWLEDGE","format":"FILL_BLANK","context":"GENERIC","tested_point":"IMPAIRMENT_AND_COMPENSATION_RULES","difficulty":"BEGINNER","estimated_time_s":45,"lesson_id":"LS.IAS16.000014","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"understand"},"references":["IAS 16 §63","IAS 16 §65"],"exercise":{"prompt":{"fr":"","en":"Complete the summary.","es":""},"explanation":{"fr":"","en":"Approach: 1) to determine whether an item of property, plant and equipment is impaired, IAS 16 refers to IAS 36 (IAS 16, para. 63); IFRS 5 deals with assets held for sale and IAS 37 with provisions, not with the impairment test; 2) third-party compensation for a lost asset goes to profit or loss (IAS 16, para. 65), not to OCI nor as a reduction of the cost of the replacement asset, which is a separate event (IAS 16, para. 66); 3) the timing is when it becomes receivable, not when claimed or received. Main trap: using cash receipt as the test. Rule to remember: impairment under IAS 36; compensation in profit or loss when it becomes receivable.","es":""},"common_error":{"fr":"","en":"Recognising the compensation when claimed or when received rather than when it becomes receivable, or deducting it from the cost of the replacement asset.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"To determine whether an item of property, plant and equipment is impaired, IAS 16 refers to {{std}}. Compensation from a third party for a lost asset is recognised in {{where}} when it {{when}}.","es":""},"blanks":[{"id":"std","mode":"CHOICE","choices":[{"id":"IAS36","text":{"fr":"","en":"IAS 36","es":""}},{"id":"IFRS5","text":{"fr":"","en":"IFRS 5","es":""}},{"id":"IAS37","text":{"fr":"","en":"IAS 37","es":""}}],"answer":"IAS36"},{"id":"where","mode":"CHOICE","choices":[{"id":"PL","text":{"fr":"","en":"profit or loss","es":""}},{"id":"OCI","text":{"fr":"","en":"other comprehensive income","es":""}},{"id":"ASSET_COST","text":{"fr":"","en":"reduction of the replacement asset cost","es":""}}],"answer":"PL"},{"id":"when","mode":"CHOICE","choices":[{"id":"RECEIVABLE","text":{"fr":"","en":"becomes receivable","es":""}},{"id":"CLAIM","text":{"fr":"","en":"is claimed from the insurer","es":""}},{"id":"CASH","text":{"fr":"","en":"is received in cash","es":""}}],"answer":"RECEIVABLE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000179","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.GAIN_LOSS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"MEDIA","tested_point":"GAIN_NOT_REVENUE","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"gain-loss-rule"},"references":["IAS 16 §68","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"A television channel sells for EUR 85,000 an outside broadcast van it had used for six years for its live coverage (case data: it does not routinely resell its vehicles). It must present this EUR 85,000 in its revenue for the year.","es":""},"explanation":{"fr":"","en":"False. Reasoning: the sale of the outside-broadcast van is the disposal of a production asset, not a sale in the channel's ordinary activity. The net gain or loss on disposal, net proceeds less carrying amount, is recognised in profit or loss (IAS 16, para. 71) and a gain on disposal is not classified as revenue (IAS 16, para. 68). The gross price of 85,000 therefore does not appear in revenue. Main trap: treating every sale as revenue. Rule to remember: the disposal of an item of property, plant and equipment gives a net gain or loss, which is not classified as revenue (IAS 16, para. 68); paragraph 68A covers the special case of an entity that routinely sells assets it previously leased.","es":""},"common_error":{"fr":"","en":"Treating every sale as revenue, whereas disposing of a production tool is not a sale from ordinary activities.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000180","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.TRIGGERS"],"dimension":"RECOGNITION","format":"MULTIPLE_CHOICE","context":"AUTOMOTIVE","tested_point":"DERECOGNITION_EVENTS","difficulty":"BEGINNER","estimated_time_s":60,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"triggers-rule"},"references":["IAS 16 §55","IAS 16 §67","IAS 16 §69"],"exercise":{"prompt":{"fr":"","en":"An automotive supplier reviews its property, plant and equipment at year-end. Which items must be derecognised?","es":""},"explanation":{"fr":"","en":"Only two triggers: disposal, notably by sale or donation (IAS 16, para. 69), and the absence of any future benefit, either from use or from disposal (IAS 16, para. 67). The robot sold, the mould donated and the scrapped bench are derecognised.","es":""},"common_error":{"fr":"","en":"Derecognising an asset because it is idle, fully depreciated or has fallen in value, when future benefits are still expected from it.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"A welding robot sold to a subcontractor, which has obtained control of it","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"A mould donated free of charge to a technical school","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"A press stopped for two months during a drop in orders, with a planned restart","es":""},"correct":false,"feedback":{"fr":"","en":"A two-month stoppage with a planned restart does not remove the benefits expected from future use: the press stays on the balance sheet and its depreciation continues (IAS 16, para. 55). Derecognition requires a disposal or no future benefit at all, either from use or from disposal (IAS 16, paras. 67 and 69). Rule to remember: temporary idleness is not a disposal.","es":""}},{"id":"D","text":{"fr":"","en":"An obsolete test bench dismantled and scrapped, with no resale value at all","es":""},"correct":true},{"id":"E","text":{"fr":"","en":"A fully depreciated conveyor, still in service","es":""},"correct":false,"feedback":{"fr":"","en":"A fully depreciated conveyor that is still in service still provides benefits through its use: an exhausted carrying amount is not a reason for derecognition (IAS 16, para. 67). It stays recognised as long as benefits are expected from its use or disposal. Rule to remember: fully depreciated does not mean disposed of.","es":""}},{"id":"F","text":{"fr":"","en":"A machine whose market value has fallen by 30%","es":""},"correct":false,"feedback":{"fr":"","en":"A 30% fall in market value is not a derecognition event: to determine whether the asset is impaired, the entity applies IAS 36 (IAS 16, para. 63), and the machine remains in use with benefits expected (IAS 16, para. 67). Rule to remember: a fall in value is a matter for IAS 36; derecognition requires a disposal or the absence of any future benefit (IAS 16, paras. 67 and 69).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000181","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.GAIN_LOSS"],"dimension":"CALCULATION","format":"CALCULATION","context":"ENERGY","tested_point":"GAIN_LOSS_WITH_PRORATA","difficulty":"INTERMEDIATE","estimated_time_s":150,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"numeric-example"},"references":["IAS 16 §55","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Case data: an energy producer sells a standby generator set. The buyer obtains control on 31 March N. Year-end at 31 December. Teaching assumption: proration in whole months. Calculate.","es":""},"explanation":{"fr":"","en":"Approach: 1) annual charge = 360,000 ÷ 12 = 30,000; 2) depreciation runs until derecognition, here 31 March (IAS 16, para. 55): N charge = 30,000 × 3/12 = 7,500; accumulated depreciation at 31/12/N−1 = 4 × 30,000 = 120,000, i.e. 127,500 at disposal; 3) carrying amount = 360,000 − 127,500 = 232,500; 4) net proceeds = 220,000 − 4,500 = 215,500; 5) result = 215,500 − 232,500 = −17,000, a loss (IAS 16, para. 71). Main trap: forgetting the three months of depreciation (carrying amount 240,000, loss 24,500) or not deducting the seller's costs. Rule to remember: depreciate up to the date of disposal, then compare net proceeds with carrying amount.","es":""},"common_error":{"fr":"","en":"Forgetting the three months of depreciation (carrying amount EUR 240,000, loss EUR 24,500) or failing to deduct the costs borne by the seller.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Acquisition cost (1 January N-4)","es":""},"value":"360000","unit":"EUR"},{"label":{"fr":"","en":"Useful life (straight-line, nil residual value)","es":""},"value":"12","unit":"YEARS"},{"label":{"fr":"","en":"Sale price","es":""},"value":"220000","unit":"EUR"},{"label":{"fr":"","en":"Dismantling and transport costs borne by the seller","es":""},"value":"4500","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Depreciation for N up to 31 March","es":""},"answer":7500,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Carrying amount at the date of disposal","es":""},"answer":232500,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Net disposal proceeds","es":""},"answer":215500,"tolerance":0,"unit":"EUR"},{"id":"S4","label":{"fr":"","en":"Gain (+) or loss (−) on disposal","es":""},"answer":-17000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Depreciation for N up to 31 March","es":""},"expression":"(a / b) * 3 / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Acquisition cost (1 January N-4)","es":""},"value":360000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Useful life (straight-line, nil residual value)","es":""},"value":12,"unit":"YEARS"}],"result":7500,"unit":"EUR","rationale":{"fr":"","en":"depreciation runs until derecognition, here 31 March (IAS 16, para. 55): N charge = 30,000 × 3/12 = 7,500","es":""}},{"step":"S3","meaning":{"fr":"","en":"Net disposal proceeds","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Sale price","es":""},"value":220000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Dismantling and transport costs borne by the seller","es":""},"value":4500,"unit":"EUR"}],"result":215500,"unit":"EUR"},{"step":"S4","meaning":{"fr":"","en":"Gain (+) or loss (−) on disposal","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Net disposal proceeds","es":""},"value":215500,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Carrying amount at the date of disposal","es":""},"value":232500,"unit":"EUR"}],"result":-17000,"unit":"EUR"}],"rationale":{"fr":"","en":"depreciate up to the date of disposal, then compare net proceeds with carrying amount.","es":""},"references":["REF.IAS16.55","REF.IAS16.71"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000182","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.GAIN_LOSS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"TELECOM","tested_point":"DISPOSAL_ENTRY","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"entry"},"references":["IAS 16 §68","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Case data: a telecom operator sells a batch of radio equipment for EUR 25,000 in cash (cost EUR 80,000, accumulated depreciation at the date of disposal EUR 62,000, depreciation for the period already recorded). Record the derecognition entry; the cash line is given.","es":""},"explanation":{"fr":"","en":"Approach: 1) carrying amount = 80,000 − 62,000 = 18,000; 2) gain = net proceeds − carrying amount = 25,000 − 18,000 = 7,000 (IAS 16, para. 71), recognised in profit or loss and outside revenue (IAS 16, para. 68); 3) the entry debits cash for 25,000 and accumulated depreciation for 62,000, and credits cost for 80,000 and the gain for 7,000. Cost and accumulated depreciation leave together. Check: debits 87,000 = credits 87,000. Main trap: crediting revenue with 25,000 and leaving accumulated depreciation on the balance sheet. Rule to remember: on disposal the cost and its accumulated depreciation are cleared, and the difference from the price is the gain or loss (IAS 16, para. 71).","es":""},"common_error":{"fr":"","en":"Crediting revenue with EUR 25,000 and leaving the accumulated depreciation on the balance sheet.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"CASH","text":{"fr":"","en":"Cash","es":""}},{"id":"ACCUMULATED_DEPRECIATION","text":{"fr":"","en":"Accumulated depreciation — network equipment","es":""}},{"id":"NETWORK_EQUIPMENT","text":{"fr":"","en":"Network equipment (cost)","es":""}},{"id":"GAIN_ON_DISPOSAL","text":{"fr":"","en":"Gain on disposal of non-current assets","es":""}},{"id":"REVENUE","text":{"fr":"","en":"Revenue","es":""}},{"id":"DEPRECIATION_EXPENSE","text":{"fr":"","en":"Depreciation expense","es":""}}],"lines":[{"id":"L1","account":"CASH","side":"DEBIT","amount":25000,"given":["account","side","amount"]},{"id":"L2","account":"ACCUMULATED_DEPRECIATION","side":"DEBIT","amount":62000},{"id":"L3","account":"NETWORK_EQUIPMENT","side":"CREDIT","amount":80000},{"id":"L4","account":"GAIN_ON_DISPOSAL","side":"CREDIT","amount":7000}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000183","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.TRIGGERS","IAS16.DERECOGNITION.GAIN_LOSS"],"dimension":"JOURNAL_ENTRY","format":"JOURNAL_ENTRY","context":"PHARMA","tested_point":"SCRAPPING_ENTRY","difficulty":"BEGINNER","estimated_time_s":75,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"example"},"references":["IAS 16 §67","IAS 16 §68","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Case data: a pharmaceutical laboratory scraps a contaminated freeze-dryer, destroyed by an approved contractor for no consideration at all. Cost: EUR 50,000; accumulated depreciation at the date of scrapping: EUR 41,000. Record the entry; the credit line is given.","es":""},"explanation":{"fr":"","en":"Approach: 1) the freeze-dryer is destroyed for no consideration: no future benefit is expected, either from use or from disposal, so it is derecognised (IAS 16, para. 67); 2) carrying amount = 50,000 − 41,000 = 9,000; net proceeds nil; 3) loss = 0 − 9,000 = −9,000, recognised in profit or loss (IAS 16, paras. 68 and 71); 4) the entry clears accumulated depreciation (debit 41,000) and cost (credit 50,000), the 9,000 difference being the loss. Check: debits 41,000 + 9,000 = credit 50,000. Main trap: believing that, without a sale, there is nothing to record and leaving the destroyed asset on the balance sheet. Rule to remember: an asset with no future benefit expected is derecognised even without a sale, and the loss is its carrying amount less net proceeds.","es":""},"common_error":{"fr":"","en":"Believing that, without a sale, there is nothing to record and leaving the destroyed asset on the balance sheet.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"ACCUMULATED_DEPRECIATION","text":{"fr":"","en":"Accumulated depreciation — laboratory equipment","es":""}},{"id":"LOSS_ON_DERECOGNITION","text":{"fr":"","en":"Loss on derecognition of non-current assets","es":""}},{"id":"LAB_EQUIPMENT","text":{"fr":"","en":"Laboratory equipment (cost)","es":""}},{"id":"CASH","text":{"fr":"","en":"Cash","es":""}},{"id":"PROVISION","text":{"fr":"","en":"Provision","es":""}}],"lines":[{"id":"L1","account":"ACCUMULATED_DEPRECIATION","side":"DEBIT","amount":41000},{"id":"L2","account":"LOSS_ON_DERECOGNITION","side":"DEBIT","amount":9000},{"id":"L3","account":"LAB_EQUIPMENT","side":"CREDIT","amount":50000,"given":["account","side"]}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000184","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.TRIGGERS"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"TEXTILE","tested_point":"IDLE_VS_ABANDONED","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"judgment"},"references":["IAS 16 §55","IAS 16 §67","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"Analyse the two weaving lines at the year-end of 31 December N.","es":""},"explanation":{"fr":"","en":"Approach: everything turns on the question \"is any future benefit still expected, from use or from disposal?\". Line A: idle but maintained, with an approved restart plan and signed orders; benefits are still expected, so no derecognition (IAS 16, para. 67) and depreciation continues during idleness (IAS 16, para. 55), while the drop in activity is examined as an impairment indicator (IAS 36). Line B: definitive abandonment decided by the board, dismantled, no buyer, scrap barely covering costs: no benefit expected, derecognition without a sale, loss = 0 − 120,000 = −120,000 (IAS 16, paras. 67 and 71). Main trap: basing the decision on the stop in production rather than on expected benefits. Rule to remember: when idle with expected benefits, keep and depreciate; when no benefit is expected, derecognise and recognise the loss. Documented evidence underpins the judgement.","es":""},"common_error":{"fr":"","en":"Derecognising a line that is merely idle, or keeping on the balance sheet a line definitively abandoned because it has not been sold.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"A textile company has two weaving lines. Line A (carrying amount EUR 400,000) has been stopped since September N for lack of orders; it is still maintained, and an approved restart plan provides for it to resume in March N+1, with orders already signed. For line B (carrying amount EUR 120,000 at the date of the decision), the board decided in November N to abandon it permanently (obsolete technology); it was dismantled in December, no buyer was found and the scrap just covers the dismantling costs (case data).","es":""},"parts":[{"prompt":{"fr":"","en":"What treatment for line A at 31 December N?","es":""},"explanation":{"fr":"","en":"A temporary stoppage does not eliminate the expected benefits: no derecognition (IAS 16, para. 67); depreciation continues while idle (IAS 16, para. 55). The drop in activity may, however, be an impairment indicator to be considered under IAS 36.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Derecognise the line, since it no longer produces","es":""},"correct":false,"feedback":{"fr":"","en":"Benefits are still expected from the future use of line A (approved restart, signed orders): the derecognition criterion is not met (IAS 16, para. 67). A temporary stoppage is neither a disposal nor the absence of any future benefit. Rule to remember: a production stoppage does not derecognise an asset from which benefits are still expected (IAS 16, para. 67).","es":""}},{"id":"B","text":{"fr":"","en":"Keep it on the balance sheet and continue depreciating it (unless a usage-based method is used), while considering impairment indicators","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Keep it on the balance sheet but suspend depreciation while it is stopped","es":""},"correct":false,"feedback":{"fr":"","en":"Depreciation does not cease because an asset is idle, unless it is fully depreciated (IAS 16, para. 55); it ceases on classification as held for sale or on derecognition, which is not the case for line A. Suspending the charge would understate the expenses of N. Rule to remember: inactivity does not suspend depreciation (IAS 16, para. 55).","es":""}}],"id":"P1","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"Line B must be derecognised in N, even though it has not been sold.","es":""},"explanation":{"fr":"","en":"True. Approach: ask whether any benefit is still expected from use or disposal. Definitive abandonment, dismantling, no net resale value: no benefit is expected from use or from disposal, which triggers derecognition without a sale (IAS 16, para. 67). Trap: waiting for a sale before derecognising. Rule to remember: the absence of any future benefit leads to derecognition, without waiting for a sale (IAS 16, para. 67).","es":""},"common_error":{"fr":"","en":"Waiting for a sale to derecognise: the absence of any future benefit, from use or disposal, is enough.","es":""},"format":"TRUE_FALSE","answer":true,"id":"P2","dimension":"RECOGNITION"},{"prompt":{"fr":"","en":"Complete (teaching assumption: no further depreciation after the decision).","es":""},"explanation":{"fr":"","en":"Approach: calculate the result on disposal from the net proceeds and the carrying amount. Net disposal proceeds are nil (the scrap offsets the costs); loss = 0 − 120,000 = −120,000, i.e. a loss of EUR 120,000 in profit or loss (IAS 16, para. 71). Case convention: no further depreciation after the decision. Rule to remember: result on disposal = net proceeds − carrying amount (IAS 16, para. 71).","es":""},"common_error":{"fr":"","en":"Recognising no loss because there is no sale: the result on derecognition is net proceeds, here nil, less carrying amount.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"Loss recognised in profit or loss for line B: EUR {{loss}}.","es":""},"blanks":[{"id":"loss","mode":"NUMBER","answer":120000,"tolerance":0}],"id":"P3","dimension":"CALCULATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000185","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.DISPOSAL_DATE"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"LOGISTICS","tested_point":"DISPOSAL_DATE_CONTROL","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"disposal-date"},"references":["IAS 16 §69","IFRS 15 §33","IFRS 15 §38"],"exercise":{"prompt":{"fr":"","en":"Case data: a logistics company with a 31 December year-end sells an overhead crane. The contract is signed on 5 December N. On 20 December N, the crane is delivered and installed at the buyer's site and the buyer accepts it without reservation; legal title passes to the buyer on that date and the buyer bears the risks of the crane from then on. The invoice is only issued on 8 January N+1 and the price is paid on 28 February N+1. In which year and on what date is the crane derecognised?","es":""},"explanation":{"fr":"","en":"The date of disposal is the date the buyer obtains control, under IFRS 15 (IAS 16, para. 69). On 20 December N, physical possession, legal title, acceptance and transfer of risks all come together (IFRS 15, paras. 33 and 38): the crane is derecognised in N and the gain or loss on disposal belongs to year N, even though invoicing and payment occur in N+1.","es":""},"common_error":{"fr":"","en":"Waiting for the invoice or the payment to derecognise the asset, which wrongly defers the gain or loss on disposal to year N+1.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Year N, on 5 December N (contract signing)","es":""},"correct":false,"feedback":{"fr":"","en":"Signing the contract creates rights and obligations but does not transfer control: the disposal date is when the buyer obtains control (IAS 16, para. 69). On 5 December the buyer has neither physical possession, nor legal title, nor the risks, nor has it accepted the crane (IFRS 15, para. 38). Recognising the disposal at signature would bring the result forward to a date when the crane is still with the seller. Rule to remember: the contract does not transfer control; here delivery and acceptance do.","es":""}},{"id":"B","text":{"fr":"","en":"Year N, on 20 December N (delivery and acceptance)","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Year N+1, on 8 January N+1 (invoice issued)","es":""},"correct":false,"feedback":{"fr":"","en":"The invoice is an administrative document: it does not determine the transfer of control. On 20 December N the buyer has possession, legal title and the risks, and has accepted the crane (IFRS 15, para. 38): it therefore has control, and the disposal date is that day (IAS 16, para. 69). Invoicing on 8 January does not postpone the disposal; the result on disposal belongs to N. Rule to remember: the invoice date is not the disposal date.","es":""}},{"id":"D","text":{"fr":"","en":"Year N+1, on 28 February N+1 (payment of the price)","es":""},"correct":false,"feedback":{"fr":"","en":"The test is the transfer of control to the buyer (IAS 16, para. 69), not collection of the price. At 31 December N the crane is already with the buyer, which has control (IFRS 15, para. 38): the seller has derecognised it and recognises a receivable from the buyer until payment in February N+1. Waiting for payment would wrongly postpone the result on disposal to N+1. Rule to remember: cash collection is not the disposal date.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000186","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.DISPOSAL_CONSIDERATION"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"AGRIFOOD","tested_point":"DEFERRED_VARIABLE_CONSIDERATION","difficulty":"EXPERT","estimated_time_s":300,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"consideration"},"references":["IAS 16 §71","IAS 16 §72","IFRS 15 §50","IFRS 15 §56","IFRS 15 §60","IFRS 15 §64","IFRS 15 §65"],"exercise":{"prompt":{"fr":"","en":"Determine the consideration and the result on disposal at the date control transfers.","es":""},"explanation":{"fr":"","en":"Three-step approach. 1) Fixed consideration: payment in two years carries a significant financing benefit, so the consideration is discounted at the rate of a separate financing transaction (IFRS 15, paras. 60 and 64): 302,500 ÷ 1.10² = 250,000; result on disposal = 250,000 − 260,000 = −10,000, a loss (IAS 16, paras. 71 and 72). 2) Variable part: the 40,000 additional amount is estimated (IFRS 15, para. 50) but included only if it is highly probable that it will not be reversed (IFRS 15, para. 56); under management's judgement (case data) this is not the case, and later changes follow IFRS 15 (IAS 16, para. 72). 3) Difference of 52,500: this is interest income presented separately (IFRS 15, para. 65), not part of the result on disposal. Main trap: using 302,500 and a gain of 42,500. Rule to remember: on disposal, consideration is determined under IFRS 15, discounted and constrained for its variable part; interest is presented separately.","es":""},"common_error":{"fr":"","en":"Including the EUR 52,500 discounting difference in the result on disposal, or including the EUR 40,000 variable amount in the consideration straight away.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"On 1 July N, a food group disposes of a drying unit (carrying amount at that date: EUR 260,000). Price: EUR 302,500 payable on 1 July N+2, plus an additional EUR 40,000 if the buyer's output exceeds a threshold in N+1. Rate of a separate financing transaction with this buyer: 10% (case data). Management's judgement (case data): with no track record, it is not highly probable that the additional amount will not be reversed.","es":""},"parts":[{"prompt":{"fr":"","en":"Calculate (amounts in EUR).","es":""},"explanation":{"fr":"","en":"Approach: discount the fixed price, then compare with the carrying amount. Payment in two years provides a significant financing benefit: the consideration is discounted (IFRS 15, paras. 60 and 64), 302,500 / 1.10² = EUR 250,000. Result: 250,000 − 260,000 = EUR −10,000 (IAS 16, paras. 71 and 72). Trap: using 302,500 and concluding there is a gain of 42,500. Rule to remember: the consideration for a disposal with deferred payment is discounted before the result is calculated (IFRS 15, paras. 60 and 64); (IAS 16, para. 72).","es":""},"common_error":{"fr":"","en":"Using the nominal price of 302,500 and concluding there is a gain: the deferred consideration is discounted first.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Fixed price payable in two years","es":""},"value":"302500","unit":"EUR"},{"label":{"fr":"","en":"Financing rate","es":""},"value":"10","unit":"PERCENT"},{"label":{"fr":"","en":"Carrying amount","es":""},"value":"260000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Fixed consideration at the date of disposal","es":""},"answer":250000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Gain (+) or loss (−) on disposal","es":""},"answer":-10000,"tolerance":0,"unit":"EUR"}],"id":"P1","dimension":"CALCULATION","formula":{"lines":[{"step":"S2","meaning":{"fr":"","en":"Gain (+) or loss (−) on disposal","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Fixed consideration at the date of disposal","es":""},"value":250000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Carrying amount","es":""},"value":260000,"unit":"EUR"}],"result":-10000,"unit":"EUR"}],"rationale":{"fr":"","en":"the consideration for a disposal with deferred payment is discounted before the result is calculated (IFRS 15, paras. 60 and 64); (IAS 16, para. 72).","es":""},"references":["REF.IAS16.71","REF.IAS16.72","REF.IFRS15.60","REF.IFRS15.64"]}},{"prompt":{"fr":"","en":"How should the additional EUR 40,000 be treated at the date of disposal?","es":""},"explanation":{"fr":"","en":"The consideration is determined under IFRS 15, and so are its subsequent changes (IAS 16, para. 72): the variable part is estimated (IFRS 15, para. 50) but included only if it is highly probable that it will not be reversed (IFRS 15, para. 56). Here, that is not the case.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Include it in full in the consideration","es":""},"correct":false,"feedback":{"fr":"","en":"A variable amount is included in the consideration only if it is highly probable that it will not be reversed (IFRS 15, para. 56). Here, for lack of history, that is not the case according to management's judgement (case data): including the 40,000 from the outset would overstate the consideration. Rule to remember: the variable amount is estimated, but is included only if that probability threshold is met (IFRS 15, para. 56).","es":""}},{"id":"B","text":{"fr":"","en":"Estimate it, then exclude it from the consideration at this stage, given management's judgement; reassess subsequently under IFRS 15","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Never take it into account, even if it is received","es":""},"correct":false,"feedback":{"fr":"","en":"Subsequent changes in the consideration follow IFRS 15 (IAS 16, para. 72): the additional amount must not be set aside for good. It will be taken into account when the constraint no longer applies, for example if the production threshold is reached. Rule to remember: the initial exclusion of the variable amount is not final; it is reassessed under IFRS 15 (IAS 16, para. 72).","es":""}}],"id":"P2","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"The EUR 52,500 difference between 302,500 and 250,000 is part of the result on disposal.","es":""},"explanation":{"fr":"","en":"False. Approach: separate the disposal consideration from interest income. This difference pays for the credit granted to the buyer: it is interest income, presented separately and recognised over the period of credit (IFRS 15, para. 65), not part of the gain or loss on disposal. Trap: including the discounting difference of 52,500 in the disposal result. Rule to remember: the discounting difference is interest income presented separately, outside the disposal result (IFRS 15, para. 65).","es":""},"common_error":{"fr":"","en":"Including the discount difference in the result on disposal: it is interest income, presented separately.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P3","dimension":"RULE_KNOWLEDGE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000187","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.RENTAL_ASSETS_TO_INVENTORY"],"dimension":"APPLICATION","format":"SINGLE_CHOICE","context":"AUTOMOTIVE","tested_point":"RENTAL_ASSETS_TO_INVENTORY","difficulty":"ADVANCED","estimated_time_s":75,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"rental-to-inventory"},"references":["IAS 16 §68","IAS 16"],"exercise":{"prompt":{"fr":"","en":"A car rental company systematically resells its vehicles after eighteen months of rental; these sales are part of its ordinary activities. How does it account for a vehicle that leaves the rental fleet to be sold?","es":""},"explanation":{"fr":"","en":"For an entity that routinely sells assets previously held for rental: transfer to inventories at carrying amount when they cease to be rented and become held for sale, sale proceeds as revenue under IFRS 15, no IFRS 5 (IAS 16, para. 68A). This is the exception to the rule in para. 68.","es":""},"common_error":{"fr":"","en":"Applying the general disposal rule (net gain outside revenue) to a lessor that habitually sells its rental assets, or transferring the vehicle to inventory at fair value.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It keeps it in property, plant and equipment until the sale, then recognises a net gain or loss outside revenue","es":""},"correct":false,"feedback":{"fr":"","en":"This is the general rule in paragraph 68, but IAS 16 provides an exception for an entity that habitually sells assets previously held for rental (IAS 16, para. 68A). For this lessor, such sales are part of ordinary activity: the vehicle is transferred to inventory at its carrying amount as soon as it ceases to be rented and becomes held for sale, and the sale price goes to revenue under IFRS 15. Rule to remember: a lessor that habitually resells its fleet goes through inventories, not through a net gain on disposal.","es":""}},{"id":"B","text":{"fr":"","en":"It classifies it as a non-current asset held for sale under IFRS 5","es":""},"correct":false,"feedback":{"fr":"","en":"Paragraph 68A rules out IFRS 5 for these assets: when an entity habitually sells assets previously held for rental, they are transferred to inventory at their carrying amount as soon as they cease to be rented and become held for sale (IAS 16, para. 68A). Classifying them as held for sale would apply a framework that the standard excludes here. Rule to remember: for a lessor that habitually resells, transfer to inventory rather than IFRS 5 classification.","es":""}},{"id":"C","text":{"fr":"","en":"It transfers it to inventories at its carrying amount when it ceases to be rented and becomes held for sale, then recognises the sale price as revenue under IFRS 15","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"It transfers it to inventories at fair value and recognises a gain on transfer","es":""},"correct":false,"feedback":{"fr":"","en":"The transfer to inventory is made at carrying amount, not at fair value: no gain arises at the time of transfer (IAS 16, para. 68A). The result appears on sale, when the price (revenue under IFRS 15) is set against the carrying amount transferred. Example: carrying amount 18,000 and sale price 21,500 give a margin of 3,500, recognised on sale and not at transfer. Rule to remember: transfer at carrying amount, margin on sale.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000188","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.RENTAL_ASSETS_TO_INVENTORY"],"dimension":"JOURNAL_ENTRY","format":"MINI_CASE","context":"CONSTRUCTION","tested_point":"RENTAL_TRANSFER_ENTRY","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"rental-to-inventory"},"references":["IAS 16","IAS 2 §34"],"exercise":{"prompt":{"fr":"","en":"Record the end of rental and then the sale of the mini excavator.","es":""},"explanation":{"fr":"","en":"Two-step approach. 1) On 30 June N, the lessor habitually resells its mini-excavators: the machine withdrawn from the fleet moves to inventory at its carrying amount, 45,000 − 27,000 = 18,000, clearing cost (credit 45,000) and accumulated depreciation (debit 27,000); no gain arises and IFRS 5 does not apply (IAS 16, para. 68A). Check: debits 18,000 + 27,000 = credit 45,000. 2) On 15 August N, the sale is presented gross: revenue of 21,500 under IFRS 15 (IAS 16, para. 68A) and cost of sales of 18,000, the carrying amount of the inventory (IAS 2, para. 34); margin 21,500 − 18,000 = 3,500. Main trap: recognising a gain at transfer or showing only the margin. Rule to remember: rental assets move to inventory at carrying amount, then the sale is presented as revenue and cost of sales.","es":""},"common_error":{"fr":"","en":"Recognising a gain at the time of transfer to inventory, or presenting only the net margin instead of revenue and cost of sales.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"A construction equipment hire company routinely resells its mini excavators after three years of rental. On 30 June N, a mini excavator (cost EUR 45,000, accumulated depreciation EUR 27,000, depreciation up to date) is withdrawn from the rental fleet and offered for sale. It is sold for EUR 21,500 in cash on 15 August N (case data).","es":""},"parts":[{"prompt":{"fr":"","en":"Entry on 30 June N (the credit line is given).","es":""},"explanation":{"fr":"","en":"Approach: the lessor routinely resells its mini-excavators once taken out of the rental fleet, so they are transferred to inventories at carrying amount. Transfer to inventories at carrying amount, 45,000 − 27,000 = EUR 18,000, with no gain and no IFRS 5 (IAS 16, para. 68A). Totals: 45,000 = 45,000. Trap: recognising a gain on transfer. Rule to remember: a machine taken out of rental to be sold moves to inventories at its carrying amount (IAS 16, para. 68A).","es":""},"common_error":{"fr":"","en":"Recognising a gain on transfer or applying IFRS 5: the rental asset held for resale moves to inventory at its carrying amount.","es":""},"format":"JOURNAL_ENTRY","accounts":[{"id":"INVENTORIES","text":{"fr":"","en":"Inventories of equipment held for sale","es":""}},{"id":"ACCUMULATED_DEPRECIATION","text":{"fr":"","en":"Accumulated depreciation — rental equipment","es":""}},{"id":"RENTAL_EQUIPMENT","text":{"fr":"","en":"Rental equipment (cost)","es":""}},{"id":"HELD_FOR_SALE","text":{"fr":"","en":"Non-current assets held for sale","es":""}},{"id":"GAIN_ON_DISPOSAL","text":{"fr":"","en":"Gain on disposal of non-current assets","es":""}}],"lines":[{"id":"L1","account":"INVENTORIES","side":"DEBIT","amount":18000},{"id":"L2","account":"ACCUMULATED_DEPRECIATION","side":"DEBIT","amount":27000},{"id":"L3","account":"RENTAL_EQUIPMENT","side":"CREDIT","amount":45000,"given":["account","side","amount"]}],"id":"P1","dimension":"JOURNAL_ENTRY"},{"prompt":{"fr":"","en":"Complete the amounts for the sale on 15 August N.","es":""},"explanation":{"fr":"","en":"Approach: present the sale gross, then release the inventory. The selling price is revenue under IFRS 15 (IAS 16, para. 68A); the carrying amount of the inventory is expensed in the same period (IAS 2, para. 34). Margin: 21,500 − 18,000 = EUR 3,500. Rule to remember: the sale of an asset previously rented out is presented as revenue and cost of sales (IAS 16, para. 68A); (IAS 2, para. 34).","es":""},"common_error":{"fr":"","en":"Presenting only the net margin (3,500): the sale of an asset previously rented is shown as revenue and cost of sales.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"Revenue: EUR {{revenue}}; cost of sales: EUR {{cost}}.","es":""},"blanks":[{"id":"revenue","mode":"NUMBER","answer":21500,"tolerance":0},{"id":"cost","mode":"NUMBER","answer":18000,"tolerance":0}],"id":"P2","dimension":"CALCULATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000189","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.SALE_AND_LEASEBACK"],"dimension":"PROFESSIONAL_JUDGMENT","format":"SINGLE_CHOICE","context":"RETAIL","tested_point":"SALE_AND_LEASEBACK_IFRS16","difficulty":"EXPERT","estimated_time_s":120,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"sale-and-leaseback"},"references":["IAS 16 §68","IAS 16 §71","IFRS 16 §98","IFRS 16 §99","IFRS 16 §100","IFRS 16 §103"],"exercise":{"prompt":{"fr":"","en":"Case data: a retailer sells its logistics warehouse (carrying amount EUR 6,000,000) to an investor for EUR 9,000,000 and immediately leases it back for ten years. The CFO proposes to recognise a gain of EUR 3,000,000 under IAS 16. Which analysis is correct?","es":""},"explanation":{"fr":"","en":"The gain on derecognition (net disposal proceeds less carrying amount, IAS 16, para. 71) goes to profit or loss unless IFRS 16 requires otherwise for a sale and leaseback (IAS 16, para. 68). IFRS 16 requires checking whether the transfer is a sale under IFRS 15 (IFRS 16, paras. 98 and 99); if so, only the part of the gain relating to the rights transferred is recognised (IFRS 16, para. 100); if not, the asset stays on the balance sheet with a financial liability (IFRS 16, para. 103). Effect on the financial statements: the gain recognised is limited to the part relating to the rights transferred and is not classified as revenue (IAS 16, para. 68).","es":""},"common_error":{"fr":"","en":"Mechanically applying the IAS 16 formula without spotting the leaseback.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The proposal is correct: gain = price − carrying amount","es":""},"correct":false,"feedback":{"fr":"","en":"The calculation price − carrying amount is the general rule (IAS 16, para. 71), but IAS 16 refers sale and leaseback to IFRS 16 (IAS 16, para. 68). The immediate leaseback changes the analysis: first check whether the transfer is a sale under IFRS 15 (IFRS 16, paras. 98 and 99) and, if so, recognise only the part of the gain relating to the rights transferred (IFRS 16, para. 100). Recognising the full 3,000,000 straight away ignores this limit. Rule to remember: in a sale and leaseback, apply IFRS 16 before calculating a gain.","es":""}},{"id":"B","text":{"fr":"","en":"Apply IFRS 16: first check whether the transfer is a sale under IFRS 15; if so, recognise only the gain relating to the rights transferred; if not, keep the asset and recognise a financial liability","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"No gain is ever recognised in a sale and leaseback","es":""},"correct":false,"feedback":{"fr":"","en":"This answer goes too far. If the transfer is a sale under IFRS 15, the part of the gain relating to the rights actually transferred to the buyer is recognised (IFRS 16, para. 100). Only when the transfer is not a sale does the entity keep the asset on the balance sheet with a financial liability (IFRS 16, para. 103). Rule to remember: in a sale and leaseback, whether it is a sale decides: partial gain if a sale, asset kept and financial liability otherwise.","es":""}},{"id":"D","text":{"fr":"","en":"The EUR 9,000,000 price is presented as revenue","es":""},"correct":false,"feedback":{"fr":"","en":"The price of 9,000,000 is not revenue: selling a warehouse is the derecognition of an item of property, plant and equipment, whose gain is not classified as revenue (IAS 16, para. 68), and sale and leaseback is further governed by IFRS 16 (IFRS 16, paras. 98 to 103). Paragraph 68A concerns a different situation, that of an entity that routinely sells assets it previously leased, which is not the case of a retailer selling its warehouse (IAS 16, para. 68A). Rule to remember: the gain on disposal of an item of property, plant and equipment, even in a sale and leaseback, is not classified as revenue (IAS 16, para. 68).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000190","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.GAIN_LOSS"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"HOSPITALITY","tested_point":"DISPOSAL_ERRORS","difficulty":"ADVANCED","estimated_time_s":180,"lesson_id":"LS.IAS16.000015","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"pitfalls"},"references":["IAS 16 §41","IAS 16 §55","IAS 16 §65","IAS 16 §66","IAS 16 §68","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"A hotel group has sold a revalued building and lost a kitchen in a fire, covered by its insurer. Spot the erroneous statements in the accountant's working notes.","es":""},"explanation":{"fr":"","en":"Steps: examine each note in the light of three mechanisms, the disposal of a revalued asset, the insurance compensation and the calculation of the disposal result. Depreciation continues until disposal (IAS 16, para. 55); the revaluation surplus may be transferred directly to retained earnings, without going through profit or loss (IAS 16, para. 41); the loss of the asset and the compensation are separate events, accounted for separately (IAS 16, paras. 65 and 66); the disposal result is calculated from the net proceeds and the carrying amount (IAS 16, para. 71) and is not classified as revenue (IAS 16, para. 68). Three notes are wrong: reclassifying the surplus to profit or loss (S2), offsetting against the compensation (S4), calculating on the original cost (S5). Rule to remember: the disposal result is calculated on the carrying amount and the revaluation surplus goes directly to retained earnings (IAS 16, paras. 41 and 71). Effect on the financial statements: reclassifying the surplus to profit or loss would wrongly inflate the gain on disposal.","es":""},"common_error":{"fr":"","en":"Recycling the revaluation surplus to profit or loss, offsetting the compensation against the loss, or calculating the result on disposal on original cost.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"Depreciation of the building was recognised up to the date control transferred.","es":""},"erroneous":false},{"id":"S2","text":{"fr":"","en":"The balance of the building's revaluation surplus (EUR 400,000) was reclassified to profit or loss, increasing the gain on disposal.","es":""},"erroneous":true,"correction":{"fr":"","en":"The revaluation surplus is never reclassified to profit or loss: it may be transferred directly to retained earnings, without passing through profit or loss (IAS 16, para. 41).","es":""}},{"id":"S3","text":{"fr":"","en":"The gain on disposal was presented in an 'other income' line, separate from revenue.","es":""},"erroneous":false},{"id":"S4","text":{"fr":"","en":"The insurance compensation for the kitchen was deducted from the carrying amount derecognised, so that no loss appears.","es":""},"erroneous":true,"correction":{"fr":"","en":"The loss of the asset and the compensation are separate events: the loss on derecognition is recognised, and the compensation is recognised in profit or loss when it becomes receivable (IAS 16, paras. 65 and 66).","es":""}},{"id":"S5","text":{"fr":"","en":"The gain on disposal of the building was calculated as the sale price less its original cost.","es":""},"erroneous":true,"correction":{"fr":"","en":"The gain is calculated against the carrying amount (revalued amount less accumulated depreciation) at the date of disposal, starting from the net proceeds (IAS 16, para. 71).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000191","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.CLASS_INFORMATION"],"dimension":"DOCUMENTATION","format":"MULTIPLE_CHOICE","context":"MANUFACTURING","tested_point":"ACCOUNTING_POLICY_NOTE","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000016","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"class-information"},"references":["IAS 16 §73","IAS 16 §75","IAS 16"],"exercise":{"prompt":{"fr":"","en":"You are drafting the 'accounting policies' section of the note for the 'Machinery' class of a manufacturer. Which sentences correspond to information required by IAS 16?","es":""},"explanation":{"fr":"","en":"Measurement basis, method and lives are required by class (IAS 16, para. 73); the depreciation for the period, whether in profit or loss or included in the cost of other assets, must also be disclosed (IAS 16, para. 75). The fair value of a class at cost is only encouraged (IAS 16, para. 79).","es":""},"common_error":{"fr":"","en":"Mixing up required disclosures (measurement, depreciation, charge) with those that are only encouraged (fair value of a class at cost) or unrelated to the standard.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"'Machinery is measured under the cost model.'","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"'It is depreciated on a straight-line basis over 8 to 12 years.'","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"'Most machines were bought from European suppliers.'","es":""},"correct":false,"feedback":{"fr":"","en":"The geographical origin of suppliers is not among the disclosures IAS 16 requires: for each class, the standard asks for the measurement bases, depreciation methods, useful lives or rates and the reconciliation of carrying amounts (IAS 16, para. 73), as well as the depreciation charge for the period (IAS 16, para. 75). This sentence is descriptive, but not required. Rule to remember: IAS 16 asks to describe measurement, depreciation and movements, not where purchases came from.","es":""}},{"id":"D","text":{"fr":"","en":"'The fair value of the machinery exceeds its carrying amount by EUR 2,000,000.'","es":""},"correct":false,"feedback":{"fr":"","en":"For a class measured at cost, fair value is only an encouraged disclosure, when it differs significantly from carrying amount (IAS 16, para. 79): it is not a requirement. Unlike the measurement basis, method and lives (IAS 16, para. 73) or the depreciation charge (IAS 16, para. 75), this sentence is therefore not a required disclosure. Rule to remember: encouraged does not mean required.","es":""}},{"id":"E","text":{"fr":"","en":"'Depreciation for the year amounts to EUR 1,150,000, of which EUR 90,000 is included in the cost of inventories produced.'","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000192","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.RECONCILIATION"],"dimension":"CALCULATION","format":"CALCULATION","context":"RETAIL","tested_point":"RECONCILIATION_CLOSING","difficulty":"INTERMEDIATE","estimated_time_s":180,"lesson_id":"LS.IAS16.000016","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"numeric-example"},"references":["IAS 16 §73"],"exercise":{"prompt":{"fr":"","en":"Case data: 'Store fittings' class of a retailer, measured at cost. Determine the closing amounts of the reconciliation.","es":""},"explanation":{"fr":"","en":"Approach: 1) closing gross amount = 2,400,000 + 350,000 − 200,000 = 2,550,000; 2) closing accumulated amount = 900,000 − 170,000 + 260,000 + 40,000 = 1,030,000: the accumulated depreciation on disposals is removed, the charge and the impairment loss are added; 3) carrying amount = 2,550,000 − 1,030,000 = 1,520,000. Check through carrying amount: 1,500,000 + 350,000 − 30,000 − 260,000 − 40,000 = 1,520,000 (IAS 16, para. 73). Main trap: deducting 200,000 (gross amount of the disposal) from carrying amount instead of its carrying amount of 30,000. Rule to remember: in the reconciliation, each movement goes in the right column (gross or accumulated), and a disposal reduces carrying amount only by its own carrying amount.","es":""},"common_error":{"fr":"","en":"Removing EUR 200,000 (the gross amount of the disposal) from the carrying amount instead of its carrying amount of EUR 30,000.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Opening gross carrying amount","es":""},"value":"2400000","unit":"EUR"},{"label":{"fr":"","en":"Opening accumulated depreciation and impairment","es":""},"value":"900000","unit":"EUR"},{"label":{"fr":"","en":"Additions","es":""},"value":"350000","unit":"EUR"},{"label":{"fr":"","en":"Disposals: gross amount","es":""},"value":"200000","unit":"EUR"},{"label":{"fr":"","en":"Disposals: accumulated depreciation","es":""},"value":"170000","unit":"EUR"},{"label":{"fr":"","en":"Depreciation for the year","es":""},"value":"260000","unit":"EUR"},{"label":{"fr":"","en":"Impairment loss recognised in profit or loss","es":""},"value":"40000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Closing gross carrying amount","es":""},"answer":2550000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Closing accumulated depreciation and impairment","es":""},"answer":1030000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Closing carrying amount","es":""},"answer":1520000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Closing gross carrying amount","es":""},"expression":"a + b - c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Opening gross carrying amount","es":""},"value":2400000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Additions","es":""},"value":350000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Disposals: gross amount","es":""},"value":200000,"unit":"EUR"}],"result":2550000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Closing accumulated depreciation and impairment","es":""},"expression":"a - b + c + d","variables":[{"symbol":"a","meaning":{"fr":"","en":"Opening accumulated depreciation and impairment","es":""},"value":900000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Disposals: accumulated depreciation","es":""},"value":170000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Depreciation for the year","es":""},"value":260000,"unit":"EUR"},{"symbol":"d","meaning":{"fr":"","en":"Impairment loss recognised in profit or loss","es":""},"value":40000,"unit":"EUR"}],"result":1030000,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Closing carrying amount","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Closing gross carrying amount","es":""},"value":2550000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Closing accumulated depreciation and impairment","es":""},"value":1030000,"unit":"EUR"}],"result":1520000,"unit":"EUR"}],"rationale":{"fr":"","en":"in the reconciliation, each movement goes in the right column (gross or accumulated), and a disposal reduces carrying amount only by its own carrying amount.","es":""},"references":["REF.IAS16.73"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000193","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.RECONCILIATION"],"dimension":"ANALYSIS","format":"ERROR_SPOT","context":"TELECOM","tested_point":"RECONCILIATION_ERRORS","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS16.000016","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"pitfalls"},"references":["IAS 16 §73"],"exercise":{"prompt":{"fr":"","en":"A telecom operator presents the reconciliation of its 'Network' class. Spot the statements that describe an error in building the table.","es":""},"explanation":{"fr":"","en":"Steps: build the reconciliation column by column. It is prepared by class and shows separately additions, disposals, impairment losses, depreciation and exchange differences (IAS 16, para. 73). A disposal reduces the carrying amount by its own carrying amount: 300,000 − 260,000 = 40,000; gross amount and accumulated amounts are each removed in their own column. Trap: deducting the gross amount from the carrying amount, or mixing additions, depreciation, impairment losses and exchange differences on one line. Rule to remember: each movement has its own line in the reconciliation, and a disposal reduces the carrying amount by its carrying amount (IAS 16, para. 73). Effect on the financial statements: a badly built table does not agree with the statement of financial position and distorts the information given on the class.","es":""},"common_error":{"fr":"","en":"Deducting the gross amount of a disposal from carrying amount, or mixing acquisitions, depreciation, impairment losses and exchange differences on one line.","es":""},"format":"ERROR_SPOT","statements":[{"id":"S1","text":{"fr":"","en":"The 'Disposals' line in the carrying amount column shows the gross cost of the equipment disposed of (EUR 300,000), although its accumulated depreciation amounted to EUR 260,000.","es":""},"erroneous":true,"correction":{"fr":"","en":"The carrying amount decreases only by 300,000 − 260,000 = EUR 40,000; gross and accumulated amounts are each removed in their own column.","es":""}},{"id":"S2","text":{"fr":"","en":"The EUR 60,000 impairment loss on one site was included in the 'Depreciation' line.","es":""},"erroneous":true,"correction":{"fr":"","en":"Impairment losses recognised in profit or loss have a separate line in the reconciliation (IAS 16, para. 73).","es":""}},{"id":"S3","text":{"fr":"","en":"Additions for the year (EUR 800,000) appear in the gross carrying amount column and in the carrying amount column.","es":""},"erroneous":false},{"id":"S4","text":{"fr":"","en":"The table covers only the 'Network' class; the other classes each have their own reconciliation.","es":""},"erroneous":false},{"id":"S5","text":{"fr":"","en":"Exchange differences on translating foreign subsidiaries were added to the 'Additions' line.","es":""},"erroneous":true,"correction":{"fr":"","en":"Net exchange differences on translation are presented on their own line (IAS 16, para. 73).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000194","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.ENCOURAGED"],"dimension":"RULE_KNOWLEDGE","format":"CLASSIFICATION","context":"MANUFACTURING","tested_point":"MANDATORY_VS_ENCOURAGED","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000016","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"encouraged"},"references":["IAS 16 §73","IAS 16 §74","IAS 16 §77","IAS 16"],"exercise":{"prompt":{"fr":"","en":"Classify each item of information according to its status in IAS 16.","es":""},"explanation":{"fr":"","en":"Approach: for each disclosure, ask whether IAS 16 requires it or only encourages it. Required: depreciation methods by class (I1, IAS 16, para. 73), contractual commitments to acquire assets and assets pledged as security (I2 and I4, IAS 16, para. 74), and the carrying amount under the cost model of a revalued class (I3, IAS 16, para. 77). Only encouraged: temporarily idle assets (I5), fully depreciated assets still in use (I6) and the fair value of a class at cost when it differs significantly from carrying amount (I7) (IAS 16, para. 79). Main trap: confusing the cost-model amount of a revalued class (required) with the fair value of a class at cost (encouraged). Rule to remember: disclosures on measurement, depreciation, security, commitments and revalued assets are required; those on idle assets, fully depreciated assets or fair value at cost are encouraged.","es":""},"common_error":{"fr":"","en":"Confusing the cost-model amount of a revalued class (mandatory) with the fair value of a class at cost (encouraged).","es":""},"format":"CLASSIFICATION","categories":[{"id":"MANDATORY","text":{"fr":"","en":"Mandatory","es":""}},{"id":"ENCOURAGED","text":{"fr":"","en":"Encouraged (optional)","es":""}}],"items":[{"id":"I1","text":{"fr":"","en":"Depreciation methods used for each class","es":""},"category":"MANDATORY"},{"id":"I2","text":{"fr":"","en":"Amount of contractual commitments to acquire machinery","es":""},"category":"MANDATORY"},{"id":"I3","text":{"fr":"","en":"Cost-model amount of a revalued class","es":""},"category":"MANDATORY"},{"id":"I4","text":{"fr":"","en":"Property, plant and equipment pledged as security for liabilities","es":""},"category":"MANDATORY"},{"id":"I5","text":{"fr":"","en":"Carrying amount of temporarily idle machinery","es":""},"category":"ENCOURAGED"},{"id":"I6","text":{"fr":"","en":"Gross carrying amount of fully depreciated equipment still in use","es":""},"category":"ENCOURAGED"},{"id":"I7","text":{"fr":"","en":"Fair value of a class measured at cost, materially different from its carrying amount","es":""},"category":"ENCOURAGED"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000195","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.RESTRICTIONS_COMMITMENTS"],"dimension":"DOCUMENTATION","format":"MINI_CASE","context":"PHARMA","tested_point":"RESTRICTIONS_COMMITMENTS_FILE","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000016","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"other-items"},"references":["IAS 16 §74"],"exercise":{"prompt":{"fr":"","en":"Prepare the items of the note covering restrictions, pledges, construction and commitments.","es":""},"explanation":{"fr":"","en":"Approach: paragraph 74 covers three disclosures: assets pledged as security, expenditure recognised for items under construction, and contractual commitments to acquire assets (IAS 16, para. 74). The pledge on the sterile unit (1) and the clean room under construction (2) fall within it; the firm order of 2,100,000 (3) is a contractual commitment. The non-binding letter of intent (4) creates no commitment, and the maintenance contract (5) does not concern the acquisition of an asset. Amounts to disclose: commitments 2,100,000; construction expenditure recognised 1,300,000. Main trap: adding 1,800,000 for the letter of intent. Rule to remember: paragraph 74 concerns assets pledged, expenditure on assets under construction and contractual commitments to acquire assets (IAS 16, para. 74).","es":""},"common_error":{"fr":"","en":"Disclosing a non-binding letter of intent or a maintenance contract as if they were contractual commitments to acquire assets.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Year-end file of a pharmaceutical laboratory at 31 December N (case data): (1) a EUR 5,000,000 bank loan is secured by a pledge over the sterile production unit (carrying amount EUR 7,400,000); (2) a clean room is under construction, with EUR 1,300,000 of expenditure already recognised; (3) a firm order for a EUR 2,100,000 filling line, deliverable in N+1, has been signed; (4) a non-binding letter of intent concerns a second line of EUR 1,800,000; (5) an annual maintenance contract of EUR 250,000 covers existing equipment.","es":""},"parts":[{"prompt":{"fr":"","en":"Which items in the file fall under the disclosure in IAS 16 para. 74?","es":""},"explanation":{"fr":"","en":"Approach: match each item in the file against the three disclosures of paragraph 74. IAS 16 requires disclosure of assets pledged, expenditure recognised on items under construction and contractual commitments to acquire assets (IAS 16, para. 74). Rule to remember: (1), (2) and (3) fall under paragraph 74; (4) and (5) do not (IAS 16, para. 74).","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"(1) the pledge over the sterile unit","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"(2) the clean room under construction","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"(3) the firm order for the filling line","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"(4) the non-binding letter of intent","es":""},"correct":false,"feedback":{"fr":"","en":"A non-binding letter of intent does not create a contractual commitment to acquire assets: it therefore does not belong in the disclosure of contractual commitments (IAS 16, para. 74). Adding 1,800,000 under that heading would overstate the entity's commitments. Rule to remember: paragraph 74 concerns contractual commitments to acquire property, plant and equipment (IAS 16, para. 74).","es":""}},{"id":"E","text":{"fr":"","en":"(5) the maintenance contract","es":""},"correct":false,"feedback":{"fr":"","en":"An annual maintenance contract of 250,000 covers existing equipment: it is not a contractual commitment to acquire property, plant and equipment, and it is not among the items listed in paragraph 74 (assets pledged, expenditure on assets under construction, acquisition commitments). Rule to remember: paragraph 74 concerns the acquisition of property, plant and equipment, not service contracts (IAS 16, para. 74).","es":""}}],"id":"P1","dimension":"RECOGNITION"},{"prompt":{"fr":"","en":"Complete the amounts to be disclosed.","es":""},"explanation":{"fr":"","en":"Approach: take the firm order as the commitment and the expenditure already recognised on the clean room. The firm order is a contractual commitment (EUR 2,100,000); the expenditure already recognised on the clean room is EUR 1,300,000 (IAS 16, para. 74). Trap: adding 1,800,000 for the letter of intent. Rule to remember: contractual commitments to acquire assets and expenditure on assets under construction are disclosed with their amounts (IAS 16, para. 74).","es":""},"common_error":{"fr":"","en":"Adding the letter of intent to commitments: only the firm order is a contractual commitment.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"Contractual commitments to acquire: EUR {{commitments}}. Expenditure recognised for items in the course of construction: EUR {{construction}}.","es":""},"blanks":[{"id":"commitments","mode":"NUMBER","answer":2100000,"tolerance":0},{"id":"construction","mode":"NUMBER","answer":1300000,"tolerance":0}],"id":"P2","dimension":"CALCULATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000196","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.PROCEEDS_BEFORE_USE"],"dimension":"RULE_KNOWLEDGE","format":"SINGLE_CHOICE","context":"AUTOMOTIVE","tested_point":"PROCEEDS_BEFORE_USE_DISCLOSURE","difficulty":"INTERMEDIATE","estimated_time_s":75,"lesson_id":"LS.IAS16.000016","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"other-items"},"references":["IAS 16 §20A","IAS 16 §74A"],"exercise":{"prompt":{"fr":"","en":"Case data: while testing its new battery plant, a carmaker sells trial cells for EUR 600,000; their cost amounts to EUR 520,000. These amounts are included in 'Other income' and 'Other expenses' without being presented separately. What must be disclosed?","es":""},"explanation":{"fr":"","en":"The proceeds and cost of items produced while the asset is being made ready go to profit or loss (IAS 16, para. 20A). If they are not presented separately, the entity discloses the amounts of proceeds and cost included in profit or loss and the line items concerned (IAS 16, para. 74A).","es":""},"common_error":{"fr":"","en":"Deducting the net result of the tests from the cost of the plant, or reclassifying it as revenue, instead of disclosing it in profit or loss with the line items concerned.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Nothing: the amounts are already in the income statement","es":""},"correct":false,"feedback":{"fr":"","en":"The amounts are in profit or loss, but not separately presented: this is exactly the case where IAS 16 requires specific disclosure (IAS 16, para. 74A). The entity must disclose the amounts of proceeds (600,000) and costs (520,000) included in profit or loss, and the line items that contain them. Without this, the user cannot identify these transactions within \"Other income\" and \"Other expenses\". Rule to remember: if not presented separately, these amounts must be disclosed in the notes.","es":""}},{"id":"B","text":{"fr":"","en":"The amounts of proceeds (EUR 600,000) and cost (EUR 520,000) included in profit or loss, and the line items that include them","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Only the net EUR 80,000, deducted from the cost of the plant","es":""},"correct":false,"feedback":{"fr":"","en":"The proceeds from selling the test cells and the cost of those items go to profit or loss under the applicable standards: they are not deducted from the cost of the plant (IAS 16, para. 20A). Presenting the net 80,000 as a reduction of the asset's cost contradicts this treatment and hides the two amounts that paragraph 74A asks to disclose. Rule to remember: proceeds and cost of test items are treated in profit or loss, separately, with no netting against the cost of the asset.","es":""}},{"id":"D","text":{"fr":"","en":"Reclassifying the EUR 600,000 as revenue","es":""},"correct":false,"feedback":{"fr":"","en":"The test cells do not come from ordinary activities: paragraph 74A does not ask for these proceeds to be reclassified as revenue, but for the amounts and line items to be disclosed when not presented separately (IAS 16, para. 74A). Reclassifying 600,000 as revenue would treat these sales as ordinary sales, which they are not. Rule to remember: paragraph 74A requires disclosure, not reclassification.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000197","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.ESTIMATES_CHANGES"],"dimension":"CALCULATION","format":"CALCULATION","context":"LOGISTICS","tested_point":"CHANGE_IN_USEFUL_LIFE_EFFECT","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS16.000016","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"estimates-revaluation-impairment"},"references":["IAS 16 §51","IAS 16 §76"],"exercise":{"prompt":{"fr":"","en":"Case data: at 1 January N, a logistics company revises the remaining useful life of its automatic sorters. Teaching assumption: straight-line depreciation of the carrying amount over the remaining life, nil residual value. Calculate the effect to be disclosed for N.","es":""},"explanation":{"fr":"","en":"Approach: 1) old estimate: 900,000 ÷ 10 = 90,000; 2) after revision: 900,000 ÷ 6 = 150,000; 3) effect of the change on the N charge = 150,000 − 90,000 = +60,000. Useful life is reviewed at least at each year-end and its modification is a change in estimate, applied prospectively (IAS 16, para. 51); the notes disclose its nature and effect (IAS 16, para. 76). Main trap: restating prior years as if it were an error. Rule to remember: a change in life is a change in estimate, with effect on the current and later periods, to be disclosed in the notes.","es":""},"common_error":{"fr":"","en":"Restating prior years as if it were an error, instead of treating the revision as a change in estimate.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Carrying amount at 1 January N","es":""},"value":"900000","unit":"EUR"},{"label":{"fr":"","en":"Remaining life before revision","es":""},"value":"10","unit":"YEARS"},{"label":{"fr":"","en":"Remaining life after revision","es":""},"value":"6","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Depreciation for N under the former estimate","es":""},"answer":90000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Depreciation for N after revision","es":""},"answer":150000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Effect of the change on depreciation for N","es":""},"answer":60000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Depreciation for N under the former estimate","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount at 1 January N","es":""},"value":900000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Remaining life before revision","es":""},"value":10,"unit":"YEARS"}],"result":90000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Depreciation for N after revision","es":""},"expression":"a / b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount at 1 January N","es":""},"value":900000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Remaining life after revision","es":""},"value":6,"unit":"YEARS"}],"result":150000,"unit":"EUR"}],"rationale":{"fr":"","en":"a change in life is a change in estimate, with effect on the current and later periods, to be disclosed in the notes.","es":""},"references":["REF.IAS16.51","REF.IAS16.76"]}},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000198","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.REVALUATION"],"dimension":"DOCUMENTATION","format":"FILL_BLANK","context":"HOSPITALITY","tested_point":"REVALUATION_DISCLOSURE_AMOUNTS","difficulty":"ADVANCED","estimated_time_s":150,"lesson_id":"LS.IAS16.000016","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"estimates-revaluation-impairment"},"references":["IAS 16 §77"],"exercise":{"prompt":{"fr":"","en":"Case data: a group's 'Hotels' class is revalued at 31 December N by an independent valuer; revalued carrying amount: EUR 8,200,000. Under the cost model, it would have a cost of EUR 9,000,000 and accumulated depreciation of EUR 2,700,000. Revaluation surplus: EUR 1,100,000 at the beginning, increase of EUR 600,000 in other comprehensive income in N, transfer of EUR 80,000 to retained earnings. Complete the note.","es":""},"explanation":{"fr":"","en":"Approach: 1) carrying amount under the cost model = cost − accumulated depreciation = 9,000,000 − 2,700,000 = 6,300,000, not gross cost; 2) closing revaluation surplus = opening + increase for the year − transfer to retained earnings = 1,100,000 + 600,000 − 80,000 = 1,620,000; 3) the involvement of an independent valuer is disclosed, with the effective date of the revaluation, the change in the surplus and any restrictions on distribution (IAS 16, para. 77). Main trap: disclosing the gross cost of 9,000,000, or forgetting the 80,000 transfer. Rule to remember: for a revalued class, disclose the carrying amount that would have been recognised under the cost model and the reconciliation of the revaluation surplus.","es":""},"common_error":{"fr":"","en":"Disclosing the gross cost (EUR 9,000,000) instead of the cost-model carrying amount, or forgetting the transfer to retained earnings.","es":""},"format":"FILL_BLANK","text":{"fr":"","en":"Carrying amount that would have been recognised under the cost model: EUR {{cost_model}}. Revaluation surplus at year-end: EUR {{surplus}}. Involvement of an independent valuer: {{valuer}}.","es":""},"blanks":[{"id":"cost_model","mode":"NUMBER","answer":6300000,"tolerance":0},{"id":"surplus","mode":"NUMBER","answer":1620000,"tolerance":0},{"id":"valuer","mode":"CHOICE","choices":[{"id":"YES","text":{"fr":"","en":"yes, to be disclosed","es":""}},{"id":"NOT_REQUIRED","text":{"fr":"","en":"not required by IAS 16","es":""}}],"answer":"YES"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000199","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.IMPAIRMENT"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"ENERGY","tested_point":"IMPAIRMENT_DISCLOSURE_IAS36","difficulty":"BEGINNER","estimated_time_s":30,"lesson_id":"LS.IAS16.000016","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"estimates-revaluation-impairment"},"references":["IAS 16 §78","IAS 36 §126","IAS 36 §130"],"exercise":{"prompt":{"fr":"","en":"A thermal power plant suffered a material impairment loss in N. The 'impairment losses' line of the IAS 16 reconciliation is enough to meet all the disclosure requirements on this loss.","es":""},"explanation":{"fr":"","en":"False. Reasoning: the \"impairment losses\" line of the reconciliation meets IAS 16's own requirement, but IAS 16 also requires the disclosures set out in IAS 36 for impaired assets (IAS 16, para. 78). IAS 36 requires losses by class (IAS 36, para. 126) and, for a significant loss, the events and circumstances, the amount, the recoverable amount and its basis (IAS 36, para. 130). Main trap: assuming the IAS 16 note is self-sufficient. Rule to remember: a significant impairment loss requires, in addition to the reconciliation, the detailed IAS 36 disclosures.","es":""},"common_error":{"fr":"","en":"Believing that the \"impairment losses\" line of the reconciliation is enough to meet the disclosure requirements for a significant loss.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000200","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.RESTRICTIONS_COMMITMENTS","IAS16.DISCLOSURE.ESTIMATES_CHANGES","IAS16.DISCLOSURE.REVALUATION","IAS16.DISCLOSURE.PROCEEDS_BEFORE_USE","IAS16.DISCLOSURE.IMPAIRMENT"],"dimension":"RECOGNITION","format":"MATCHING","context":"SHIPPING","tested_point":"DISCLOSURE_MAPPING","difficulty":"INTERMEDIATE","estimated_time_s":120,"lesson_id":"LS.IAS16.000016","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"estimates-revaluation-impairment"},"references":["IAS 16 §74","IAS 16 §74A","IAS 16 §76","IAS 16 §77","IAS 16 §78","IAS 16"],"exercise":{"prompt":{"fr":"","en":"A shipowner is preparing its note. Match each event of the year with the disclosure it triggers.","es":""},"explanation":{"fr":"","en":"Approach: for each event, look for the disclosure IAS 16 triggers. L1, mortgage: existence and amount of assets pledged as security (IAS 16, para. 74). L2, useful life changed: nature and effect of the change in estimate (IAS 16, para. 76). L3, revaluation: effective date, independent valuer, cost-model amount and revaluation surplus (IAS 16, para. 77). L4, significant impairment loss: IAS 36 disclosures (IAS 16, para. 78). L5, test sales not separately presented: amounts of proceeds and costs included in profit or loss and the line items concerned (IAS 16, para. 74A). R5, the fair value of a class at cost, is only encouraged (IAS 16, para. 79) and answers none of these events. Main trap: matching R5 by default. Rule to remember: each event triggers a specific disclosure; an encouraged disclosure is not an answer to an event.","es":""},"common_error":{"fr":"","en":"Linking the fair value of a class at cost (an encouraged disclosure only) to one of the events, or confusing revaluation disclosures with impairment disclosures.","es":""},"format":"MATCHING","left":[{"id":"L1","text":{"fr":"","en":"A vessel is mortgaged to the bank that financed its purchase","es":""}},{"id":"L2","text":{"fr":"","en":"The useful life of the tug fleet is reduced from 25 to 20 years","es":""}},{"id":"L3","text":{"fr":"","en":"The port terminals are revalued by an independent expert","es":""}},{"id":"L4","text":{"fr":"","en":"A vessel suffers a material impairment loss after a market collapse","es":""}},{"id":"L5","text":{"fr":"","en":"During the testing of a new ship-repair workshop, metal parts produced are sold; these sales are not presented separately in profit or loss","es":""}}],"right":[{"id":"R1","text":{"fr":"","en":"Existence and amount of property, plant and equipment pledged as security","es":""}},{"id":"R2","text":{"fr":"","en":"Nature and effect of the change in estimate","es":""}},{"id":"R3","text":{"fr":"","en":"Effective date, involvement of the valuer, cost-model amount, revaluation surplus","es":""}},{"id":"R4","text":{"fr":"","en":"IAS 36 information on the impaired asset","es":""}},{"id":"R5","text":{"fr":"","en":"Fair value of the fleet measured at cost (encouraged disclosure)","es":""}},{"id":"R6","text":{"fr":"","en":"Amounts of proceeds and cost of those items included in profit or loss, and the line items that include them","es":""}}],"pairs":[{"left":"L1","right":"R1"},{"left":"L2","right":"R2"},{"left":"L3","right":"R3"},{"left":"L4","right":"R4"},{"left":"L5","right":"R6"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000201","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.TRANSITION.AMENDMENTS"],"dimension":"RULE_KNOWLEDGE","format":"TRUE_FALSE","context":"MINING","tested_point":"PBIU_TRANSITION_SCOPE","difficulty":"ADVANCED","estimated_time_s":45,"lesson_id":"LS.IAS16.000017","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000017","section_id":"rule"},"references":["IAS 16"],"exercise":{"prompt":{"fr":"","en":"On first applying the amendment on proceeds before intended use, a mining entity had to restate all its assets made ready since their origin, whatever the date they were made ready.","es":""},"explanation":{"fr":"","en":"False. Reasoning: the amendment's transition provision limits the scope. It applies to items brought to the location and condition necessary for use on or after the beginning of the earliest period presented, and the cumulative effect is recognised in opening equity (IAS 16, para. 80D). Assets brought into condition before that date are not restated from inception. Main trap: extending restatement to all assets, whatever their date of being brought into condition. Rule to remember: in transition, look at the date the asset was brought into condition relative to the start of the earliest period presented, and the cumulative effect goes to opening equity.","es":""},"common_error":{"fr":"","en":"Believing that a transition provision always requires retrospective restatement of all assets from inception.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000202","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.TRANSITION.AMENDMENTS"],"dimension":"RULE_KNOWLEDGE","format":"MATCHING","context":"GENERIC","tested_point":"TRANSITION_PROVISIONS_MAP","difficulty":"ADVANCED","estimated_time_s":90,"lesson_id":"LS.IAS16.000017","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000017","section_id":"rule"},"references":["IAS 16","IAS 16 §80C","IAS 16 §81"],"exercise":{"prompt":{"fr":"","en":"Match each topic with its transition or effective date provision.","es":""},"explanation":{"fr":"","en":"Approach: match each topic to the rule stated in the corresponding paragraph. L1, assets acquired in exchanges: prospective application to future transactions only (IAS 16, para. 80). L2, bearer plants: option to use fair value as deemed cost at the beginning of the earliest period presented, with the difference in opening retained earnings (IAS 16, para. 80C). L3, proceeds before intended use: items brought into condition on or after the beginning of the earliest period presented, with cumulative effect in opening equity (IAS 16, para. 80D). L4, the revised standard: annual periods beginning on or after 1 January 2005 (IAS 16, para. 81). R5, full restatement of all past transactions, matches no topic. Main trap: choosing R5 out of a retrospective reflex. Rule to remember: each transition provision has its own scope, often limited, and an effective date is not a restatement rule.","es":""},"common_error":{"fr":"","en":"Applying full restatement of past transactions to every transition provision, or confusing an effective date with a transition rule.","es":""},"format":"MATCHING","left":[{"id":"L1","text":{"fr":"","en":"Assets acquired in an exchange","es":""}},{"id":"L2","text":{"fr":"","en":"Bearer plants","es":""}},{"id":"L3","text":{"fr":"","en":"Proceeds before intended use","es":""}},{"id":"L4","text":{"fr":"","en":"The revised standard itself","es":""}}],"right":[{"id":"R1","text":{"fr":"","en":"Prospective application to future transactions only","es":""}},{"id":"R2","text":{"fr":"","en":"Option: fair value as deemed cost at the start of the earliest period presented, difference in opening retained earnings","es":""}},{"id":"R3","text":{"fr":"","en":"Items made ready from the start of the earliest period presented, cumulative effect in opening equity","es":""}},{"id":"R4","text":{"fr":"","en":"Annual periods beginning on or after 1 January 2005","es":""}},{"id":"R5","text":{"fr":"","en":"Full restatement of all past transactions","es":""}}],"pairs":[{"left":"L1","right":"R1"},{"left":"L2","right":"R2"},{"left":"L3","right":"R3"},{"left":"L4","right":"R4"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000203","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.CRITERIA"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"FOOD","tested_point":"PROBABLE_BENEFITS_JUSTIFICATION","difficulty":"INTERMEDIATE","estimated_time_s":210,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"judgment"},"references":["IAS 16 §7","IAS 16 §10"],"exercise":{"prompt":{"fr":"","en":"Analyse the two items of expenditure and justify your conclusion on the future economic benefits criterion.","es":""},"explanation":{"fr":"","en":"Approach: recognition requires two cumulative criteria, probable future economic benefits and a reliably measured cost (IAS 16, para. 7), assessed when the cost is incurred (IAS 16, para. 10). Packaging line: the supply contract signed for its output and the approved investment decision show probable benefits, and the invoice of 320,000 establishes the cost; both criteria are met. Mould: with no planned use and no other use identified, benefits are not probable; despite the invoiced cost of 18,000, the expenditure is an expense of the year (professional judgement: it is prudent to document it). Main trap: concluding it is an asset as soon as an invoice exists. Rule to remember: an invoice establishes cost, not benefits; both criteria are needed, with entity-specific evidence.","es":""},"common_error":{"fr":"","en":"Concluding that an item is capitalised as soon as an invoice exists, without examining the intended use.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Case data: a dairy cooperative incurs two items of expenditure in N. (1) A second yoghurt packaging line, invoiced at EUR 320,000; its purchase was approved by the board, and the cooperative has signed a five-year supply contract with a retail chain for the output of this line. (2) A mould specific to a new pot format, invoiced at EUR 18,000 and delivered in December N; between order and delivery, management abandoned the launch of this format, and no other use for the mould has been identified.","es":""},"parts":[{"prompt":{"fr":"","en":"Which justification best demonstrates that the packaging line will probably generate future economic benefits?","es":""},"explanation":{"fr":"","en":"The probability of benefits is assessed by reference to the entity's intended use, with evidence specific to it: a signed contract for the line's output and an approved investment (IAS 16, para. 7).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The signed supply contract for its output and the investment decision approved by the board","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The ten-year warranty offered by the line's manufacturer","es":""},"correct":false,"feedback":{"fr":"","en":"The manufacturer's warranty concerns the proper working of the machine; it does not show that the cooperative will derive benefits from the use it plans. Probable benefits are assessed against the entity's intended use, with evidence specific to it (IAS 16, para. 7). Rule to remember: a performance warranty does not demonstrate probable future economic benefits (IAS 16, para. 7).","es":""}},{"id":"C","text":{"fr":"","en":"The supplier's invoice for EUR 320,000","es":""},"correct":false,"feedback":{"fr":"","en":"The supplier's invoice proves that the cost can be measured reliably, which is the other recognition criterion; it says nothing about the benefits expected (IAS 16, para. 7). The two criteria are cumulative and each must be demonstrated. Rule to remember: an invoice establishes cost, not the probability of benefits (IAS 16, para. 7).","es":""}}],"id":"P1","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"How does the cooperative treat the EUR 18,000 mould in N?","es":""},"explanation":{"fr":"","en":"When the expenditure is incurred, no use is planned: the first criterion is not met and the expenditure is expensed (IAS 16, paras. 7 and 10). Professional judgement: if a use were identified later, it would be prudent to document it before any new analysis. Rule to remember: probable future benefits are assessed when the expenditure is incurred (IAS 16, para. 10).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"As an expense: with no intended use, future economic benefits are not probable","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"As property, plant and equipment, since its cost is known from the invoice","es":""},"correct":false,"feedback":{"fr":"","en":"The two criteria are cumulative: a cost known from an invoice is not enough if future benefits are not probable (IAS 16, para. 7). Here, the launch of the format was abandoned and no other use of the mould has been identified (case data). Rule to remember: the reliable cost criterion does not replace the probable benefits criterion (IAS 16, para. 7).","es":""}},{"id":"C","text":{"fr":"","en":"As an inventory of supplies, pending a future use","es":""},"correct":false,"feedback":{"fr":"","en":"The mould is neither intended for sale nor a supply consumed in production: classifying it as inventory of supplies would not reflect its use and would merely hide that no use is planned (case data). Since the first criterion is not met, the expenditure is an expense (IAS 16, paras. 7 and 10). Rule to remember: without probable future benefits, the expenditure is not recognised as an asset (IAS 16, para. 7).","es":""}}],"id":"P2","dimension":"RECOGNITION"},{"prompt":{"fr":"","en":"The probability of benefits is assessed using the information available when the expenditure is incurred.","es":""},"explanation":{"fr":"","en":"True. Approach: place yourself at the date the expenditure is incurred. Each cost is assessed against the recognition principle when it is incurred (IAS 16, para. 10). Trap: judging with elements arising after that date. Rule to remember: the probability of benefits is assessed at the date the expenditure is incurred (IAS 16, para. 10).","es":""},"common_error":{"fr":"","en":"Judging with later information: probability is assessed with what is available when the cost is incurred.","es":""},"format":"TRUE_FALSE","answer":true,"id":"P3","dimension":"RULE_KNOWLEDGE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000204","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.CRITERIA"],"dimension":"RECOGNITION","format":"SINGLE_CHOICE","context":"MARITIME","tested_point":"RELIABLE_MEASUREMENT_OF_COST","difficulty":"INTERMEDIATE","estimated_time_s":90,"lesson_id":"LS.IAS16.000004","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"criteria"},"references":["IAS 16 §7"],"exercise":{"prompt":{"fr":"","en":"Case data: at the end of N, a shipyard presents four items of expenditure that it wishes to recognise as assets. For which one is cost not, on the current file, measured reliably?","es":""},"explanation":{"fr":"","en":"Cost is recognised as an asset only if it can be measured reliably (IAS 16, para. 7). For the pontoon, no verifiable data support the amount proposed: the criterion is not demonstrated as things stand. Professional judgement: the entity must first reconstruct the cost from supporting documents (store issue notes, hour records, invoices); it is prudent to document that reconstruction. Rule to remember: a cost supported by verifiable records is reliably measured; an estimate without records does not demonstrate this criterion (IAS 16, para. 7).","es":""},"common_error":{"fr":"","en":"Confusing an in-house construction that is measurable thanks to records with an estimate that has no supporting documents.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"A quay crane bought for EUR 410,000, supported by a contract and an invoice","es":""},"correct":false,"feedback":{"fr":"","en":"This option describes a reliably measured cost: the contract and invoice fix the amount of EUR 410,000, and the reliable measurement criterion is met (IAS 16, para. 7). Rule to remember: a cost supported by a contract and an invoice is reliably measurable.","es":""}},{"id":"B","text":{"fr":"","en":"A slipway built by the in-house team: materials invoiced at EUR 96,000 and 1,100 hours recorded on project timesheets","es":""},"correct":false,"feedback":{"fr":"","en":"An internally constructed asset is not in itself an unreliable cost. Here, the invoiced materials (EUR 96,000) and 1,100 hours recorded by project allow the cost to be rebuilt from verifiable records, which meets the reliable measurement criterion (IAS 16, para. 7). It is the lack of records, as for the pontoon, that is the problem, not the in-house nature. Rule to remember: a cost rebuilt from verifiable records, such as project records, can be reliably measured, even for in-house construction (IAS 16, para. 7).","es":""}},{"id":"C","text":{"fr":"","en":"A mooring pontoon built in-house with materials taken from the general store: neither the store issues nor the hours were recorded by project; the amount proposed, \"about EUR 150,000\", is an oral estimate by the team leader","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"A gantry crane received on deferred payment terms: contractual price of EUR 220,000 payable in eighteen months","es":""},"correct":false,"feedback":{"fr":"","en":"The contract fixes the price of EUR 220,000: the amount is therefore reliably measurable. Deferred payment raises a different question, that of how cost is measured, which is the cash price equivalent when the credit period exceeds normal terms (IAS 16, para. 23), and not a reliability problem under paragraph 7. Rule to remember: deferred payment affects the amount recorded, not the reliability of the measurement.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000205","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.ANNUAL_REVIEW"],"dimension":"DOCUMENTATION","format":"MINI_CASE","context":"PRINTING","tested_point":"CHANGE_IN_ESTIMATE_DISCLOSURE","difficulty":"ADVANCED","estimated_time_s":240,"lesson_id":"LS.IAS16.000013","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"annual-review"},"references":["IAS 16 §51","IAS 16 §76","IAS 8 §36"],"exercise":{"prompt":{"fr":"","en":"Prepare the disclosure on the change in useful life.","es":""},"explanation":{"fr":"","en":"Approach: 1) initial charge = 480,000 ÷ 10 = 48,000; carrying amount at 1 January N = 480,000 − 4 × 48,000 = 288,000; 2) remaining life = 8 − 4 = 4 years; N charge = 288,000 ÷ 4 = 72,000; 3) effect on N = 72,000 − 48,000 = +24,000. The change in life is a change in estimate, applied prospectively (IAS 16, para. 51): comparatives are not restated. The notes disclose the nature of the change, its effect on N and its effect on later years (IAS 16, para. 76): 72,000 a year to N+3, then no charge in N+4 and N+5, instead of 48,000 a year to N+5. Main trap: mentioning only the effect on N, or restating comparatives. Rule to remember: the change in life applies for the future, and the notes describe its nature and its effect on the current and later periods.","es":""},"common_error":{"fr":"","en":"Disclosing only the effect on N and forgetting the effect on later years, or restating comparatives.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Case data: a printer acquired an offset press on 1 January N−4 for EUR 480,000, depreciated on a straight-line basis over 10 years with no residual value. Early in N, the arrival of a digital printing technology leads management to reduce the total useful life of the press to 8 years from 1 January N; residual value remains nil. Teaching assumption: the press is the only asset concerned and the effect is material.","es":""},"parts":[{"prompt":{"fr":"","en":"Calculate the amounts needed for the note.","es":""},"explanation":{"fr":"","en":"Approach: initial charge = 480,000 ÷ 10 = 48,000; carrying amount at 1 January N = 480,000 − 4 × 48,000 = 288,000. Remaining life: 8 − 4 = 4 years; charge for N = 288,000 ÷ 4 = 72,000. Effect on N: 72,000 − 48,000 = 24,000 of additional charge (IAS 16, para. 51). Trap: recalculating from the start over 8 years (480,000 ÷ 8 = 60,000). Rule to remember: the new life applies to the remaining carrying amount, over the remaining life (IAS 16, para. 51).","es":""},"common_error":{"fr":"","en":"Recomputing from inception over 8 years: the remaining carrying amount is spread over the remaining life.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Cost of the press","es":""},"value":"480000","unit":"EUR"},{"label":{"fr":"","en":"Original total useful life","es":""},"value":"10","unit":"YEARS"},{"label":{"fr":"","en":"Revised total useful life at 1 January N","es":""},"value":"8","unit":"YEARS"}],"steps":[{"id":"S1","label":{"fr":"","en":"Carrying amount at 1 January N","es":""},"answer":288000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Depreciation charge for N after the revision","es":""},"answer":72000,"tolerance":0,"unit":"EUR"},{"id":"S3","label":{"fr":"","en":"Effect of the change on the N charge (increase)","es":""},"answer":24000,"tolerance":0,"unit":"EUR"}],"id":"P1","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Carrying amount at 1 January N","es":""},"expression":"a - (b - (b - 4)) * (a / c)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the press","es":""},"value":480000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Revised total useful life at 1 January N","es":""},"value":8,"unit":"YEARS"},{"symbol":"c","meaning":{"fr":"","en":"Original total useful life","es":""},"value":10,"unit":"YEARS"}],"result":288000,"unit":"EUR"},{"step":"S2","meaning":{"fr":"","en":"Depreciation charge for N after the revision","es":""},"expression":"a / (b - (b - 4))","variables":[{"symbol":"a","meaning":{"fr":"","en":"Carrying amount at 1 January N","es":""},"value":288000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Revised total useful life at 1 January N","es":""},"value":8,"unit":"YEARS"}],"result":72000,"unit":"EUR"},{"step":"S3","meaning":{"fr":"","en":"Effect of the change on the N charge (increase)","es":""},"expression":"a - (b / c)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Depreciation charge for N after the revision","es":""},"value":72000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Cost of the press","es":""},"value":480000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Original total useful life","es":""},"value":10,"unit":"YEARS"}],"result":24000,"unit":"EUR"}],"rationale":{"fr":"","en":"the new life applies to the remaining carrying amount, over the remaining life (IAS 16, para. 51).","es":""},"references":["REF.IAS16.51"]}},{"prompt":{"fr":"","en":"Which items must the note on property, plant and equipment contain in respect of this change? (Several answers possible.)","es":""},"explanation":{"fr":"","en":"Approach: ask what the note must describe. IAS 16 refers to disclosure of the nature and effect of a change in estimate that has an effect on the current period or subsequent periods, in particular for useful lives (IAS 16, para. 76): nature, effect on N, effect on subsequent years. Rule to remember: the note states the nature of the change and its effect on the period and on subsequent periods (IAS 16, para. 76).","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The nature of the change: total useful life of the press reduced from 10 to 8 years following a technological development","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The effect on year N: EUR 24,000 of additional depreciation","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The effect on later years: a charge of EUR 72,000 a year until N+3, then no charge in N+4 and N+5, instead of EUR 48,000 a year until N+5","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"The restatement of the N−1 comparatives using the new life","es":""},"correct":false,"feedback":{"fr":"","en":"A change in useful life is a change in accounting estimate, dealt with under IAS 8 (IAS 16, para. 51): it is accounted for prospectively (IAS 8, para. 36), without restating the N−1 comparatives. The note describes the nature of the change and its effect (IAS 16, para. 76). Rule to remember: a change in estimate applies for the future, without restating comparatives (IAS 8, para. 36).","es":""}}],"id":"P2","dimension":"DOCUMENTATION"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000206","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.ASSET_EXCHANGE"],"dimension":"PROFESSIONAL_JUDGMENT","format":"MINI_CASE","context":"LOGISTICS","tested_point":"EXCHANGE_COMMERCIAL_SUBSTANCE_EVALUATION","difficulty":"ADVANCED","estimated_time_s":210,"lesson_id":"LS.IAS16.000007","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000007","section_id":"exchange-how"},"references":["IAS 16 §24","IAS 16 §25"],"exercise":{"prompt":{"fr":"","en":"Evaluate the commercial substance of each of the two exchanges.","es":""},"explanation":{"fr":"","en":"Approach: the key is commercial substance, assessed by the change in after-tax cash flows or in entity-specific value, significant relative to the fair value of the assets exchanged (IAS 16, para. 25). Exchange (1), van for an identical van, same routes, no change in cash flows: no commercial substance, so the van received is measured at the carrying amount of the van given up (IAS 16, para. 24). Exchange (2), truck for a sorting trolley for a new activity, after-tax cash flows markedly changed, and fair values reliable: commercial substance, so measurement at fair value (IAS 16, para. 24). Main trap: judging by the nature of the assets or the absence of cash rather than by expected cash flows. The assessment of what is significant is a matter of judgement and relies on the business plan. Rule to remember: commercial substance = significant change in expected cash flows; without it, the carrying amount of the asset given up.","es":""},"common_error":{"fr":"","en":"Judging commercial substance by the nature of the assets or the absence of cash, rather than by expected cash flows.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Case data: a parcel delivery group enters into two exchanges in N with no cash paid. (1) Its Lyon subsidiary gives a delivery van to an independent carrier and receives in exchange a van of the same model, the same age and comparable mileage; both vehicles serve the same rounds and the business plan expects no change in cash flows. (2) Its Lille subsidiary gives a rigid truck used for urban deliveries and receives an automatic sorting trolley intended for a new order-picking activity; according to the business plan, the subsidiary's after-tax cash flows change markedly in amount and timing, to an extent that is significant relative to the fair value of the assets exchanged. The fair values of the assets can be measured reliably.","es":""},"parts":[{"prompt":{"fr":"","en":"Exchange (1), van for van: which conclusion should be reached?","es":""},"explanation":{"fr":"","en":"Approach: check whether the expected cash flows change. The expected cash flows stay the same: without commercial substance, the cost of the asset received is the carrying amount of the asset given up (IAS 16, paras. 24 and 25). Rule to remember: without commercial substance, the asset received is measured at the carrying amount of the asset given up (IAS 16, para. 24).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"No commercial substance: the van received is measured at the carrying amount of the van given up","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Commercial substance: the van received is measured at the fair value of the van given up","es":""},"correct":false,"feedback":{"fr":"","en":"Nothing changes in the expected cash flows: both vans serve the same rounds and the business plan foresees no change in cash flows (case data). The exchange therefore has no commercial substance (IAS 16, para. 25), and the van received is not measured at fair value. Rule to remember: without a change in cash flows or in entity-specific value, there is no commercial substance (IAS 16, para. 25).","es":""}},{"id":"C","text":{"fr":"","en":"Commercial substance, since the exchange is made with an independent third party","es":""},"correct":false,"feedback":{"fr":"","en":"The independence of the counterparty is not the criterion for commercial substance: it is assessed by the change in cash flows or in entity-specific value (IAS 16, para. 25). Here, the cash flows do not change. An exchange with an independent third party can therefore lack commercial substance. Rule to remember: the nature of the counterparty does not decide commercial substance (IAS 16, para. 25).","es":""}}],"id":"P1","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"Exchange (2), truck for sorting trolley: which conclusion should be reached?","es":""},"explanation":{"fr":"","en":"After-tax cash flows change in a documented way that is significant relative to the fair value of the assets exchanged: the exchange has commercial substance and, as fair value is reliable, the trolley is measured at fair value (IAS 16, paras. 24 and 25).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Commercial substance: the trolley received is measured at fair value","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"No commercial substance, since no cash is paid","es":""},"correct":false,"feedback":{"fr":"","en":"The absence of cash does not prevent commercial substance: it is assessed on the significant change in expected cash flows or in entity-specific value (IAS 16, para. 25). Here, the Lille subsidiary's after-tax cash flows change markedly (case data). Rule to remember: the absence of cash exchanged is not the criterion for commercial substance (IAS 16, para. 25).","es":""}}],"id":"P2","dimension":"PROFESSIONAL_JUDGMENT"},{"prompt":{"fr":"","en":"Two assets of a different nature are enough to give an exchange commercial substance.","es":""},"explanation":{"fr":"","en":"False. Approach: identify the criterion for commercial substance. The criterion is the change in expected cash flows or in entity-specific value, and its significance (IAS 16, para. 25), not the nature of the assets. Trap: judging by the nature of the assets. Rule to remember: two assets of a different nature are not enough to give an exchange commercial substance (IAS 16, para. 25).","es":""},"common_error":{"fr":"","en":"Inferring commercial substance from the nature of the assets: it depends on a significant change in cash flows or entity-specific value.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P3","dimension":"RULE_KNOWLEDGE"}]},"scope":"CORE_STUDENT"},{"key":"LX.IAS16.000207","source":"V2","standard_id":"IAS16","concept_ids":["IAS16.TRANSITION.AMENDMENTS"],"dimension":"APPLICATION","format":"MINI_CASE","context":"MANUFACTURING","tested_point":"PBIU_TRANSITION_MINI","difficulty":"ADVANCED","estimated_time_s":300,"lesson_id":"LS.IAS16.000017","review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000017","section_id":"how"},"references":["IAS 16","IAS 16 §20A","IAS 16 §81"],"exercise":{"prompt":{"fr":"","en":"Apply to Cimora the transition provision of the amendment on proceeds before intended use.","es":""},"explanation":{"fr":"","en":"Approach: (1) identify the transition provision of the amendment (IAS 16, para. 80D; effective date in the paragraphs following para. 81); (2) define the scope by the date made ready (kiln included, mill excluded); (3) restate: kiln cost 1,000,000 and +10,000 in N−1 profit or loss (IAS 16, para. 20A); (4) recognise any effect prior to the earliest period presented in opening equity (IAS 16, para. 80D).","es":""},"common_error":{"fr":"","en":"Defining the scope by the purchase date or the date of the first sale instead of the date the item was brought to the condition to operate as intended by management.","es":""},"format":"MINI_CASE","scenario":{"fr":"","en":"Cimora, a cement producer (a fictitious entity), has a 31 December year end and presents its year N financial statements with a single comparative year, N−1. In N it applies for the first time the amendment on proceeds before intended use; until now, it deducted from the cost of its installations the proceeds of sales made during testing. Two installations are concerned (case data). A mill was brought to the condition necessary to operate as intended by management in November N−2. A kiln was brought to that condition on 1 March N−1, after testing in January and February N−1: costs incurred 1,030,000, including 30,000 of cost of the clinker produced during testing, measured under IAS 2; this clinker was sold for 40,000. In the published N−1 accounts, the kiln is carried at 990,000 (1,030,000 − 40,000). Case convention: the effect on depreciation is not required.","es":""},"parts":[{"prompt":{"fr":"","en":"Which installations fall within the scope of the first application of the amendment?","es":""},"explanation":{"fr":"","en":"The scope is read from the date the item was brought to the condition to operate as intended by management, compared with the start of the earliest period presented in the financial statements of first application (IAS 16, para. 80D): 1 March N−1 for the kiln (included), November N−2 for the mill (excluded).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The kiln only","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The mill and the kiln","es":""},"correct":false,"feedback":{"fr":"","en":"The mill was brought to working condition in November N−2, before the start of the earliest period presented (1 January N−1): it stays outside the restatement (IAS 16, para. 80D).","es":""}},{"id":"C","text":{"fr":"","en":"None, as the amendment applies only to installations made ready in N","es":""},"correct":false,"feedback":{"fr":"","en":"Application is retrospective for items made ready from the start of the earliest period presented, here 1 January N−1, not from N (IAS 16, para. 80D).","es":""}}],"id":"P1","dimension":"RECOGNITION"},{"prompt":{"fr":"","en":"Calculate, for the restated N−1 comparatives, the cost of the kiln and the net effect of the test sales in profit or loss.","es":""},"explanation":{"fr":"","en":"Restated cost = 1,030,000 − 30,000 = 1,000,000: the sale proceeds are no longer deducted from cost, and the cost of the clinker sold leaves the installation. N−1 profit or loss: proceeds 40,000 − cost of the clinker 30,000 = +10,000 (IAS 16, para. 20A). Difference with the published accounts: 1,000,000 − 990,000 = +10,000 on the kiln, equal to the effect in profit or loss. The restatement concerns N−1 because the kiln falls within the scope of the amendment (IAS 16, para. 80D).","es":""},"common_error":{"fr":"","en":"Keeping the cost of the test clinker in the cost of the kiln (1,030,000): this cost is recognised in profit or loss together with the sale proceeds.","es":""},"format":"CALCULATION","data":[{"label":{"fr":"","en":"Costs incurred on the kiln","es":""},"value":"1030000","unit":"EUR"},{"label":{"fr":"","en":"Cost of the test clinker (IAS 2)","es":""},"value":"30000","unit":"EUR"},{"label":{"fr":"","en":"Proceeds from selling the test clinker","es":""},"value":"40000","unit":"EUR"}],"steps":[{"id":"S1","label":{"fr":"","en":"Restated cost of the kiln","es":""},"answer":1000000,"tolerance":0,"unit":"EUR"},{"id":"S2","label":{"fr":"","en":"Net effect of the test sales in N−1 profit or loss","es":""},"answer":10000,"tolerance":0,"unit":"EUR"}],"id":"P2","dimension":"CALCULATION","formula":{"lines":[{"step":"S1","meaning":{"fr":"","en":"Restated cost of the kiln","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Costs incurred on the kiln","es":""},"value":1030000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Cost of the test clinker (IAS 2)","es":""},"value":30000,"unit":"EUR"}],"result":1000000,"unit":"EUR"}],"rationale":{"fr":"","en":"The restatement concerns N−1 because the kiln falls within the scope of the amendment (IAS 16, para. 80D).","es":""},"references":["REF.IAS16.80D","REF.IAS16.20A"]}},{"prompt":{"fr":"","en":"For consistency, Cimora must also restate the cost of the mill, even though it was made ready in N−2.","es":""},"explanation":{"fr":"","en":"False. The transition provision limits retrospective application to items made ready from the start of the earliest period presented (IAS 16, para. 80D): the mill keeps the cost determined under the former practice, even though the new rule would have produced another amount.","es":""},"common_error":{"fr":"","en":"Believing that a retrospective transition provision requires all existing assets to be restated, whatever the date they were made ready.","es":""},"format":"TRUE_FALSE","answer":false,"id":"P3","dimension":"APPLICATION"},{"prompt":{"fr":"","en":"Where is the cumulative effect of initially applying this amendment recognised?","es":""},"explanation":{"fr":"","en":"The cumulative effect of initially applying the amendment is recognised as an adjustment to the opening balance of retained earnings, or another component of equity as appropriate, at the beginning of the earliest period presented, here 1 January N−1 (IAS 16, para. 80D). At Cimora, as the kiln was tested in N−1, the whole effect appears in the N−1 comparatives.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"As an adjustment to the opening balance of retained earnings (or another component of equity) at the beginning of the earliest period presented","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"In profit or loss for year N, the year of first application","es":""},"correct":false,"feedback":{"fr":"","en":"The cumulative effect does not go through N profit or loss: it adjusts opening equity of the earliest period presented (IAS 16, para. 80D).","es":""}},{"id":"C","text":{"fr":"","en":"Nowhere, as the amendment applies prospectively to future transactions only","es":""},"correct":false,"feedback":{"fr":"","en":"Prospective application to future transactions only is the rule for assets acquired in an exchange (IAS 16, para. 80); the amendment on proceeds before intended use applies retrospectively, within a limited scope (IAS 16, para. 80D).","es":""}}],"id":"P4","dimension":"RULE_KNOWLEDGE"}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000001","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.OBJECTIVE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000001","tested_point":"QST.IAS16.000001","difficulty":"BEGINNER","source":"V1","format":"TRUE_FALSE","estimated_time_s":45,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"understand"},"references":["IAS 16 §1"],"exercise":{"prompt":{"fr":"","en":"True or false? IAS 16 sets out, among other things, when an item of property, plant and equipment is recognised, what carrying amount it is given and which depreciation charges and impairment losses are recognised.","es":""},"explanation":{"fr":"","en":"True. IAS 16 prescribes the accounting treatment for property, plant and equipment so that users of financial statements can understand the entity's investment in these assets and the changes in that investment. Its core issues are the recognition of the asset, the determination of its carrying amount and the depreciation charges and impairment losses to be recognised (IAS 16, para. 1).","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000002","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.MEASUREMENT_AT_COST"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000002","tested_point":"QST.IAS16.000002","difficulty":"BEGINNER","source":"V1","format":"TRUE_FALSE","estimated_time_s":45,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"starting-point"},"references":["IAS 16 §15"],"exercise":{"prompt":{"fr":"","en":"True or false? An item of property, plant and equipment that qualifies for recognition is initially measured at its fair value at the acquisition date.","es":""},"explanation":{"fr":"","en":"False. Steps: distinguish initial measurement from subsequent measurement. On initial recognition, an item that meets the recognition criteria is measured at cost (IAS 16, para. 15). Fair value comes into play after initial recognition if the entity chooses the revaluation model (IAS 16, para. 31), and in certain exchanges of assets (IAS 16, para. 24). Trap: confusing initial measurement (at cost) with subsequent measurement. Rule to remember: on initial recognition, an item of property, plant and equipment that meets the recognition criteria is measured at cost (IAS 16, para. 15).","es":""},"common_error":{"fr":"","en":"Taking fair value at the acquisition date as the basis of initial measurement, confusing initial measurement (at cost) with subsequent measurement (revaluation model).","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000003","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.DEPRECIABLE_AMOUNT"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000003","tested_point":"QST.IAS16.000003","difficulty":"INTERMEDIATE","source":"V1","format":"TRUE_FALSE","estimated_time_s":45,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"depreciable-amount"},"references":["IAS 16 §52","IAS 16 §54"],"exercise":{"prompt":{"fr":"","en":"True or false? When the fair value of a warehouse rises above its carrying amount, the entity may suspend depreciation for as long as this situation lasts, even though its residual value remains below its carrying amount.","es":""},"explanation":{"fr":"","en":"False. Steps: depreciation spreads the depreciable amount over the useful life (IAS 16, para. 50), so it is compared with residual value, not with fair value. It is recognised even if the asset's fair value exceeds its carrying amount, as long as residual value does not exceed the carrying amount (IAS 16, para. 52). The charge becomes zero if residual value equals or exceeds the carrying amount (IAS 16, para. 54), which is not the case here. Trap: believing that depreciation follows market value. Rule to remember: depreciation continues as long as residual value stays below the carrying amount, whatever the fair value (IAS 16, para. 52).","es":""},"common_error":{"fr":"","en":"Suspending depreciation of a building as soon as its fair value exceeds its carrying amount, as if depreciation followed market value.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000004","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.LAND_AND_BUILDINGS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000004","tested_point":"QST.IAS16.000004","difficulty":"BEGINNER","source":"V1","format":"TRUE_FALSE","estimated_time_s":45,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"land-and-buildings"},"references":["IAS 16 §58"],"exercise":{"prompt":{"fr":"","en":"True or false? When an entity acquires land together with the building on it, it accounts for them as two separate assets and, as a general rule, does not depreciate the land.","es":""},"explanation":{"fr":"","en":"True. Steps: land and buildings are two separate assets. They are accounted for separately even when acquired together; land, which generally has an unlimited useful life, is generally not depreciated, with exceptions such as quarries and landfill sites; buildings, by contrast, are depreciated (IAS 16, para. 58). Trap: depreciating the land with the building because of a single purchase price. Rule to remember: land and buildings are accounted for separately; land is generally not depreciated, the building is (IAS 16, para. 58).","es":""},"common_error":{"fr":"","en":"Depreciating the land together with the building because both were bought together for a single price.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000005","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.TRIGGERS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000005","tested_point":"QST.IAS16.000005","difficulty":"INTERMEDIATE","source":"V1","format":"TRUE_FALSE","estimated_time_s":45,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"triggers-rule"},"references":["IAS 16 §67"],"exercise":{"prompt":{"fr":"","en":"True or false? A machine that is permanently out of service, from which the entity expects no future economic benefits from either its use or its disposal, must be derecognised even though it has not been sold or physically scrapped.","es":""},"explanation":{"fr":"","en":"True. Steps: ask whether future economic benefits are still expected from using or disposing of the machine. The carrying amount of an item of property, plant and equipment is derecognised on disposal or when no future economic benefits are expected from its use or disposal (IAS 16, para. 67). Derecognition therefore does not depend on a sale: keeping on the balance sheet an item with no expected benefits would overstate assets. Trap: waiting for a sale or a physical scrapping. Rule to remember: an asset is derecognised on disposal or when no future benefits are expected any more (IAS 16, para. 67).","es":""},"common_error":{"fr":"","en":"Keeping an out-of-use machine on the balance sheet until it is sold or scrapped, although no future benefit is expected from it.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000006","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.CESSATION"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000006","tested_point":"QST.IAS16.000006","difficulty":"ADVANCED","source":"V1","format":"TRUE_FALSE","estimated_time_s":45,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"start-and-cessation"},"references":["IAS 16 §55"],"exercise":{"prompt":{"fr":"","en":"True or false? A bottling line depreciated on a straight-line basis, shut down for three months because of a temporary drop in demand, stops being depreciated during the shutdown and resumes depreciation when it restarts.","es":""},"explanation":{"fr":"","en":"False. Steps: first check whether the asset is classified as held for sale or derecognised, then look at the method. Depreciation ceases at the earlier of two dates: classification as held for sale (IFRS 5) or derecognition; it does not cease when the asset becomes idle, unless it is fully depreciated (IAS 16, para. 55). With a usage-based method (units of production), the charge can be zero during the stoppage; here the method is straight-line, so the charge continues. Trap: equating a temporary stoppage with the end of the asset's use. Rule to remember: inactivity does not suspend straight-line depreciation (IAS 16, para. 55).","es":""},"common_error":{"fr":"","en":"Stopping straight-line depreciation of a line during a temporary shutdown, treating idleness as the end of the asset's use.","es":""},"format":"TRUE_FALSE","answer":false},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000007","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.MODEL_CONDITIONS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000007","tested_point":"QST.IAS16.000007","difficulty":"INTERMEDIATE","source":"V1","format":"TRUE_FALSE","estimated_time_s":45,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"conditions-rule"},"references":["IAS 16 §31"],"exercise":{"prompt":{"fr":"","en":"True or false? Under the revaluation model, a building revalued to its fair value continues to be depreciated after the revaluation date.","es":""},"explanation":{"fr":"","en":"True. Steps: ask what the revaluation changes. Under the revaluation model, the asset is carried at its revalued amount, i.e. its fair value at the date of revaluation less subsequent accumulated depreciation and impairment losses (IAS 16, para. 31). Subsequent depreciation therefore keeps applying to the revalued amount: revaluation changes the depreciated base, not the obligation to depreciate. Trap: believing that a revalued asset stops being depreciated. Rule to remember: under the revaluation model, the revalued asset continues to be depreciated (IAS 16, para. 31).","es":""},"common_error":{"fr":"","en":"Stopping depreciation of a building after it is revalued to fair value, when only the depreciable base has changed.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000008","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.IMPAIRMENT"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000008","tested_point":"QST.IAS16.000008","difficulty":"ADVANCED","source":"V1","format":"TRUE_FALSE","estimated_time_s":45,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"estimates-revaluation-impairment"},"references":["IAS 16 §78"],"exercise":{"prompt":{"fr":"","en":"True or false? For impaired property, plant and equipment, the entity discloses the impairment information required by IAS 36, in addition to the movements shown in the carrying amount reconciliation required by IAS 16.","es":""},"explanation":{"fr":"","en":"True. IAS 16 refers to IAS 36 for disclosures about impaired property, plant and equipment, in addition to the information in the carrying amount reconciliation (impairment losses and reversals in profit or loss or other comprehensive income) (IAS 16, para. 78). Both sets of information complement each other: the reconciliation shows the movement, IAS 36 explains the circumstances and the recoverable amount.","es":""},"format":"TRUE_FALSE","answer":true},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000009","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.GENERAL"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000009","tested_point":"QST.IAS16.000009","difficulty":"BEGINNER","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"general-scope"},"references":["IAS 16 §2"],"exercise":{"prompt":{"fr":"","en":"A property development company holds the following items. Which one falls within the scope of IAS 16?","es":""},"explanation":{"fr":"","en":"IAS 16 applies to property, plant and equipment except when another standard requires or permits a different accounting treatment (IAS 16, para. 2). The intended use of the asset determines the applicable standard: inventory (IAS 2), investment property (IAS 40), held for sale (IFRS 5) or an asset used by the entity (IAS 16).","es":""},"common_error":{"fr":"","en":"Applying IAS 16 to an item that belongs under another standard (inventory, investment property, asset held for sale), reasoning on the nature of the item rather than its intended use.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Completed flats that it sells in the ordinary course of business.","es":""},"correct":false,"feedback":{"fr":"","en":"This choice confuses the nature of an item with its use. Completed flats intended for sale in the ordinary course of business are inventories (IAS 2): for a property developer they are the goods being sold, just as new cars are for a car dealer. IAS 16 applies to property, plant and equipment unless another standard requires or permits a different treatment (IAS 16, para. 2). Rule to remember: an item held for sale in the ordinary course of business is inventory, not IAS 16.","es":""}},{"id":"B","text":{"fr":"","en":"The office building it occupies as its head office.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"A building leased out to third parties to earn rentals (investment property).","es":""},"correct":false,"feedback":{"fr":"","en":"This answer relies on the nature of the item (a building) rather than its use. A building leased to third parties to earn rentals is held as an investment: it falls under IAS 40 (investment property), not IAS 16, which gives way when another standard requires a different treatment (IAS 16, para. 2). It is the building the company occupies as its head office that stays within IAS 16. Rule to remember: building leased out for rentals, IAS 40; building occupied by the entity, IAS 16.","es":""}},{"id":"D","text":{"fr":"","en":"A warehouse it has classified as held for sale under IFRS 5.","es":""},"correct":false,"feedback":{"fr":"","en":"An asset classified as held for sale is within IFRS 5 and leaves the scope of IAS 16, which applies unless another standard requires or permits a different treatment (IAS 16, para. 2). The mistake is to think the type of asset (here a warehouse, which would otherwise be property, plant and equipment) is enough to identify the standard: the IFRS 5 classification takes precedence. Rule to remember: once an asset is classified as held for sale, IFRS 5 applies rather than IAS 16.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000010","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.PPE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000010","tested_point":"QST.IAS16.000010","difficulty":"BEGINNER","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"ppe-boundaries"},"references":["IAS 16 §6"],"exercise":{"prompt":{"fr":"","en":"Which statement correctly sets out the two conditions in the definition of property, plant and equipment?","es":""},"explanation":{"fr":"","en":"Under the IAS 16 definition, property, plant and equipment are tangible items held for use in the production or supply of goods or services, for rental to others or for administrative purposes, and expected to be used during more than one period (IAS 16, para. 6). An item consumed within a single period is not one.","es":""},"common_error":{"fr":"","en":"Ignoring the condition of expected use during more than one period, for example by capitalising an item consumed within the year.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"A tangible asset acquired for consideration whose cost exceeds a materiality threshold set by the entity.","es":""},"correct":false,"feedback":{"fr":"","en":"This option adds conditions (acquisition for consideration, a cost threshold) that are not part of the two conditions of the definition: the asset's intended use (production or supply of goods or services, rental to others, administrative purposes) and its expected use during more than one period (IAS 16, para. 6). Rule to remember: intended use and expected use during more than one period characterise an item of property, plant and equipment (IAS 16, para. 6).","es":""}},{"id":"B","text":{"fr":"","en":"A tangible asset legally owned by the entity that it could sell on an active market.","es":""},"correct":false,"feedback":{"fr":"","en":"This option relies on legal ownership and the ability to resell on an active market, which are not part of the two conditions of the definition: the asset's intended use and its expected use during more than one period (IAS 16, para. 6). It is therefore not ease of resale that makes an item of property, plant and equipment, but the use the entity makes of it. Rule to remember: legal ownership and resale on an active market are not conditions of the definition (IAS 16, para. 6).","es":""}},{"id":"C","text":{"fr":"","en":"A tangible item held for use in the production or supply of goods or services, for rental to others or for administrative purposes, and expected to be used during more than one period.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"A tangible item held for production or administrative purposes, regardless of how long it will be used.","es":""},"correct":false,"feedback":{"fr":"","en":"This option is incomplete: it omits the second condition, expected use during more than one period (IAS 16, para. 6). Without it, an item consumed within a single year, such as ink cartridges, could be mistaken for an item of property, plant and equipment. Rule to remember: intended use is not enough; the asset must also be used during more than one period (IAS 16, para. 6).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000011","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.CRITERIA"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000011","tested_point":"QST.IAS16.000011","difficulty":"BEGINNER","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"criteria"},"references":["IAS 16 §7"],"exercise":{"prompt":{"fr":"","en":"The cost of an item of property, plant and equipment is recognised as an asset if, and only if:","es":""},"explanation":{"fr":"","en":"There are two cumulative criteria: probable future economic benefits and a cost that can be measured reliably (IAS 16, para. 7). They apply to both initial and subsequent costs; an expenditure that does not meet them is an expense.","es":""},"common_error":{"fr":"","en":"Capitalising an expenditure without checking that future economic benefits are probable, relying only on payment or an internal threshold.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"the entity has legal title to it and has paid for it in full.","es":""},"correct":false,"feedback":{"fr":"","en":"Legal title and full payment are not recognition criteria. Equipment bought on credit and still unpaid can meet the criteria, whereas an expenditure paid in cash with no probable future benefit does not. IAS 16 requires that future economic benefits are probable and that the cost can be measured reliably (IAS 16, para. 7). Rule to remember: an asset is recognised on the probability of benefits and the reliability of cost, not on payment.","es":""}},{"id":"B","text":{"fr":"","en":"its cost exceeds the capitalisation threshold set by internal policy and its useful life exceeds five years.","es":""},"correct":false,"feedback":{"fr":"","en":"An internal capitalisation threshold and a minimum life of five years are not among the recognition criteria of paragraph 7. Equipment used for four years is recognised as an asset if both IAS 16 criteria are met: probable future economic benefits and a reliably measured cost (IAS 16, para. 7). Rule to remember: the two criteria of paragraph 7 decide recognition, not internal conventions (IAS 16, para. 7).","es":""}},{"id":"C","text":{"fr":"","en":"it is probable that future economic benefits associated with the item will flow to the entity, regardless of whether its cost can be measured reliably.","es":""},"correct":false,"feedback":{"fr":"","en":"The second criterion is missing: reliable measurement of cost. Probable future economic benefits are not enough; the two criteria are cumulative, and if cost cannot be measured reliably the expenditure is not recognised as an asset (IAS 16, para. 7). The wording \"regardless of how reliable the measurement is\" therefore contradicts the standard. Rule to remember: probable future benefits and reliable cost, both together.","es":""}},{"id":"D","text":{"fr":"","en":"it is probable that future economic benefits associated with the item will flow to the entity and its cost can be measured reliably.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000012","standard_id":"IAS16","concept_ids":["IAS16.RECOGNITION.SPARE_PARTS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000012","tested_point":"QST.IAS16.000012","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000004","section_id":"spare-parts"},"references":["IAS 16 §8"],"exercise":{"prompt":{"fr":"","en":"A power plant operator buys a spare turbine, kept on stand-by to quickly replace the main turbine in case of breakdown. Once installed, it would be used over several periods. It also buys seals and filters consumed during monthly servicing. Which classification is correct?","es":""},"explanation":{"fr":"","en":"Spare parts, stand-by equipment and servicing equipment are recognised under IAS 16 when they meet the definition of property, plant and equipment; otherwise they are classified as inventory (IAS 16, para. 8). The decisive test is expected use during more than one period, not the label \"spare part\".","es":""},"common_error":{"fr":"","en":"Systematically classifying spare parts as inventory, based on their label rather than their expected use.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Both as inventories, because spare parts are always inventories.","es":""},"correct":false,"feedback":{"fr":"","en":"Classifying every spare part as inventory because of its name is a mistake. IAS 16 treats as property, plant and equipment the spare parts and standby or servicing equipment that meet the definition of an item of property, plant and equipment, and classifies the others as inventory (IAS 16, para. 8). The standby turbine, used over several periods once installed, meets it. Rule to remember: it is expected use over more than one period that decides, not the label \"spare part\" (IAS 16, para. 8).","es":""}},{"id":"B","text":{"fr":"","en":"The spare turbine as property, plant and equipment; the seals and filters as inventories, expensed when consumed.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Both as property, plant and equipment, because they all relate to the operation of the plant.","es":""},"correct":false,"feedback":{"fr":"","en":"A link with the running of the power station is not enough to capitalise. The seals and filters are consumed in monthly servicing, so over a short period: they do not meet the definition and remain inventory, expensed when consumed (IAS 16, para. 8). Only the turbine, used over several periods, is capitalised. Rule to remember: each item is tested individually on expected use over more than one period.","es":""}},{"id":"D","text":{"fr":"","en":"The spare turbine expensed on purchase, because it is not yet in use.","es":""},"correct":false,"feedback":{"fr":"","en":"The fact that the turbine is not yet in service does not change its nature: stand-by equipment that meets the definition is accounted for under IAS 16 from purchase (IAS 16, para. 8). The expenditure is not an expense of the year, since the asset will provide benefits over several periods. Rule to remember: stand-by equipment that meets the definition is capitalised, even before it enters service.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000013","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.POLICY_CHOICE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000013","tested_point":"QST.IAS16.000013","difficulty":"BEGINNER","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"policy-choice-rule"},"references":["IAS 16 §29"],"exercise":{"prompt":{"fr":"","en":"After initial recognition, how does an entity measure its property, plant and equipment under IAS 16?","es":""},"explanation":{"fr":"","en":"The entity chooses either the cost model or the revaluation model as its accounting policy and applies that policy to an entire class of property, plant and equipment (IAS 16, para. 29). Applying it by class prevents selective revaluation and amounts mixing costs and values at different dates.","es":""},"common_error":{"fr":"","en":"Applying the revaluation model to a single asset of a class, choosing the model asset by asset.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"It chooses either the cost model or the revaluation model as its accounting policy and applies it to an entire class of property, plant and equipment.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"It must apply a fair value model, with changes recognised in profit or loss.","es":""},"correct":false,"feedback":{"fr":"","en":"IAS 16 does not impose fair value: the entity chooses between the cost model and the revaluation model, applied to an entire class (IAS 16, para. 29). Moreover, even under revaluation, an increase goes to other comprehensive income, not profit or loss, unless it reverses an earlier decrease (IAS 16, para. 39). Rule to remember: two models to choose from, with no obligation to use fair value and no systematic changes in profit or loss.","es":""}},{"id":"C","text":{"fr":"","en":"It chooses the model asset by asset, selecting for each item the one that best reflects how its market value is changing.","es":""},"correct":false,"feedback":{"fr":"","en":"Choosing, asset by asset, the model that best reflects market value leads to selective revaluation. The policy choice applies to an entire class of property, plant and equipment (IAS 16, para. 29), which avoids mixing, within one class, amounts at cost and amounts at values of different dates. Example: you do not revalue one plot of land while leaving the other plots at cost. Rule to remember: the chosen model applies to the whole class.","es":""}},{"id":"D","text":{"fr":"","en":"It keeps the asset at its original cost without depreciation until disposal.","es":""},"correct":false,"feedback":{"fr":"","en":"The cost model is not an absence of depreciation: it carries the asset at cost less accumulated depreciation and accumulated impairment losses (IAS 16, para. 30). After initial recognition, the entity chooses between this model and the revaluation model (IAS 16, para. 29). Keeping original cost with no depreciation until disposal contradicts both models. Rule to remember: original cost is reduced by accumulated depreciation and impairment losses.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000014","standard_id":"IAS16","concept_ids":["IAS16.MEASUREMENT_MODEL.COST_MODEL"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000014","tested_point":"QST.IAS16.000014","difficulty":"BEGINNER","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000008","section_id":"cost-model-rule"},"references":["IAS 16 §30"],"exercise":{"prompt":{"fr":"","en":"Under the cost model, at what amount is an item of property, plant and equipment carried after initial recognition?","es":""},"explanation":{"fr":"","en":"Under the cost model, an item of property, plant and equipment is carried at its cost less any accumulated depreciation and any accumulated impairment losses (IAS 16, para. 30). Omitting impairment losses overstates the carrying amount.","es":""},"common_error":{"fr":"","en":"Leaving accumulated impairment losses out of the carrying amount calculation, deducting depreciation only.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Its cost less accumulated depreciation only.","es":""},"correct":false,"feedback":{"fr":"","en":"The accumulated impairment losses are missing, a frequent oversight: under the cost model, carrying amount is obtained by deducting from cost both accumulated depreciation and accumulated impairment losses (IAS 16, para. 30). Example: cost 100, accumulated depreciation 40, accumulated impairment 10, carrying amount 50, not 60. Rule to remember: cost − accumulated depreciation − accumulated impairment losses.","es":""}},{"id":"B","text":{"fr":"","en":"Its fair value at the reporting date, less costs of disposal.","es":""},"correct":false,"feedback":{"fr":"","en":"Fair value at the reporting date is not part of the cost model: that model starts from the original cost, less accumulated depreciation and accumulated impairment losses (IAS 16, para. 30). After initial recognition, it is the revaluation model that uses fair value at the date of revaluation, less subsequent accumulated depreciation and impairment losses (IAS 16, para. 31). Rule to remember: cost model = cost less accumulated depreciation and impairment losses; revaluation model = revalued amount.","es":""}},{"id":"C","text":{"fr":"","en":"Its cost less any accumulated depreciation and any accumulated impairment losses.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"Its original cost, with depreciation shown only in the notes.","es":""},"correct":false,"feedback":{"fr":"","en":"Keeping original cost, with depreciation shown only in the notes, is not the cost model: depreciation reduces the carrying amount of the asset, it is not merely note disclosure. The asset is carried at cost less accumulated depreciation and accumulated impairment losses (IAS 16, para. 30). Rule to remember: depreciation and impairment losses are deducted from cost in the statement of financial position.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000015","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.RESIDUAL_VALUE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000015","tested_point":"QST.IAS16.000015","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"depreciable-amount"},"references":["IAS 16 §6","IAS 16 §53"],"exercise":{"prompt":{"fr":"","en":"A haulage company plans to sell its trucks at the end of their five-year useful life. Today, a five-year-old truck in the expected condition sells on the second-hand market for about 30,000; disposal costs would be 2,000. A consultant forecasts that, owing to inflation, this truck will sell for 36,000 in five years. What residual value should be used?","es":""},"explanation":{"fr":"","en":"Residual value is the estimated amount the entity would currently obtain from disposal of the asset, after deducting the estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life (IAS 16, para. 6): 30,000 − 2,000 = 28,000. It is deducted to determine the depreciable amount (IAS 16, para. 53). The inflated forecast of 36,000 is irrelevant to this estimate.","es":""},"common_error":{"fr":"","en":"Using an inflated future resale price (here 36,000) as residual value instead of the current amount defined by the standard, net of disposal costs.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"36,000, the expected resale price in five years.","es":""},"correct":false,"feedback":{"fr":"","en":"36,000 is a forecast of a future price indexed to inflation. Residual value is estimated from the amount the entity would currently obtain for an asset already of the age and in the condition expected at the end of its useful life, after deducting estimated disposal costs (IAS 16, para. 6): here 30,000 − 2,000 = 28,000. This value is then deducted from cost to obtain the depreciable amount (IAS 16, para. 53). Rule to remember: residual value is estimated from current prices, not from indexed future prices (IAS 16, para. 6).","es":""}},{"id":"B","text":{"fr":"","en":"34,000, the forecast future price less disposal costs.","es":""},"correct":false,"feedback":{"fr":"","en":"You did deduct the 2,000 disposal costs, but the starting point (36,000) is an inflated future price. The definition uses the amount currently obtained for an asset already of that age and in that condition, i.e. 30,000, net of disposal costs: 28,000 (IAS 16, para. 6). The two corrections go together: current price, then deduction of costs. Rule to remember: a correct residual value is a current price net of disposal costs.","es":""}},{"id":"C","text":{"fr":"","en":"30,000, the current price of a five-year-old truck, without deducting disposal costs.","es":""},"correct":false,"feedback":{"fr":"","en":"The basis is right (30,000, the current price of a five-year-old truck in the expected condition), but the estimated disposal costs of 2,000 are not deducted. Residual value is net of estimated costs of disposal: 30,000 − 2,000 = 28,000 (IAS 16, para. 6). Overstating residual value by 2,000 wrongly reduces the depreciable amount (IAS 16, para. 53). Rule to remember: residual value = current price less estimated disposal costs.","es":""}},{"id":"D","text":{"fr":"","en":"28,000, the current price of a five-year-old truck in the expected condition, less disposal costs.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000016","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.CHARGE_RECOGNITION"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000016","tested_point":"QST.IAS16.000016","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"charge-rule"},"references":["IAS 16 §48","IAS 16 §49"],"exercise":{"prompt":{"fr":"","en":"The depreciation charge for a machine used exclusively to manufacture finished goods held for sale should be:","es":""},"explanation":{"fr":"","en":"The depreciation charge for each period is recognised in profit or loss unless it is included in the carrying amount of another asset (IAS 16, para. 48). This is the case when the asset's economic benefits are absorbed in producing other assets, for example depreciation of manufacturing plant included in the costs of conversion of inventories under IAS 2 (IAS 16, para. 49).","es":""},"common_error":{"fr":"","en":"Expensing straight away the depreciation of a production machine when it should be included in the cost of the inventories produced.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"included in the conversion costs of inventories, and recognised in profit or loss when the goods are sold.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"recognised immediately as an expense of the period, because depreciation is always an expense of the period in which it arises.","es":""},"correct":false,"feedback":{"fr":"","en":"This is the general rule, each period's depreciation being recognised in profit or loss, but it has an exception: when the asset's benefits are absorbed in producing other assets, the depreciation is included in the carrying amount of those assets (IAS 16, paras. 48 and 49). Here the machine only makes finished goods for sale: its depreciation is part of their cost. Expensing everything would make the period bear the cost of goods still in inventory. Rule to remember: depreciation follows production when production absorbs it.","es":""}},{"id":"C","text":{"fr":"","en":"added to the carrying amount of the machine itself.","es":""},"correct":false,"feedback":{"fr":"","en":"Adding the depreciation charge to the carrying amount of the machine itself makes no sense: depreciation spreads the machine's cost and reduces its carrying amount, it does not increase it. When the charge is not recognised in profit or loss, it is included in the carrying amount of another asset, here the inventory of finished goods (IAS 16, paras. 48 and 49). Rule to remember: the charge is recognised in profit or loss or included in the carrying amount of another asset, not added to the machine being depreciated (IAS 16, para. 48).","es":""}},{"id":"D","text":{"fr":"","en":"recognised in other comprehensive income until the goods are sold.","es":""},"correct":false,"feedback":{"fr":"","en":"Taking this depreciation charge to other comprehensive income is not the treatment described by the standard. The charge is recognised in profit or loss, unless it is included in the carrying amount of another asset, here the inventory made with the machine (IAS 16, paras. 48 and 49). The deferral until the goods are sold results from the accounting for inventory, not from a route through other comprehensive income. Rule to remember: the charge goes to profit or loss or into the cost of another asset (IAS 16, para. 48).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000017","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.INCIDENTAL_OPERATIONS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000017","tested_point":"QST.IAS16.000017","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000006","section_id":"incidental-rule"},"references":["IAS 16 §21"],"exercise":{"prompt":{"fr":"","en":"While waiting for construction of its future warehouse to begin, an entity rents out the bare site as a car park for six months. It collects receipts and incurs security costs. How should this income and these expenses be accounted for?","es":""},"explanation":{"fr":"","en":"Some operations occur in connection with the construction or development of an item but are not necessary to bring it to the location and condition required. Their income and related expenses are recognised in profit or loss and included in their respective classifications (IAS 16, para. 21). A temporary car park is the typical example.","es":""},"common_error":{"fr":"","en":"Charging to the warehouse cost the net result of an incidental operation (temporary car park) that is not necessary to bring it into condition.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The receipts net of costs are deducted from the cost of the warehouse.","es":""},"correct":false,"feedback":{"fr":"","en":"Deducting net income from the cost of the warehouse means charging to the asset the result of an activity that did not help bring it into condition. The temporary car park is an incidental operation, not necessary to bring the warehouse to the location and condition required: its income and expenses are recognised in profit or loss, in their respective line items (IAS 16, para. 21). The warehouse cost therefore does not fall by the car park income. Rule to remember: the result of an incidental operation does not change the cost of the asset.","es":""}},{"id":"B","text":{"fr":"","en":"The car park income and expenses are recognised in profit or loss, in their respective line items.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The security costs are added to the cost of the warehouse and the receipts go to profit or loss.","es":""},"correct":false,"feedback":{"fr":"","en":"The security costs relate to running the car park, not to construction: they are not costs directly attributable to the warehouse. Adding the expense to the warehouse cost while leaving the income in profit or loss arbitrarily splits one incidental operation. Its income and expenses stay together in profit or loss, in their respective line items (IAS 16, para. 21). Rule to remember: income and expenses of an incidental operation both stay in profit or loss.","es":""}},{"id":"D","text":{"fr":"","en":"The car park's net result is deferred as a liability until the warehouse is brought into use.","es":""},"correct":false,"feedback":{"fr":"","en":"Nothing allows the net result of an incidental operation to be deferred as a liability until the warehouse enters service. The standard provides for recognition in profit or loss, income and expenses each in its own line item (IAS 16, para. 21). Deferring would tie to the warehouse an operation that is not necessary to bring it into condition. Rule to remember: the result of an incidental operation is recognised in profit or loss as it arises, with no deferral.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000018","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.FAIR_VALUE_MEASUREMENT"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000018","tested_point":"QST.IAS16.000018","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"conditions-rule"},"references":["IAS 16 §6","IAS 16 §31"],"exercise":{"prompt":{"fr":"","en":"An entity applies the revaluation model to its land and buildings. Under which standard is the fair value used for the revaluation determined?","es":""},"explanation":{"fr":"","en":"IAS 16 defines fair value by reference to IFRS 13 (IAS 16, para. 6); the revaluation model carries the asset at its fair value at the revaluation date less subsequent depreciation and impairment losses (IAS 16, para. 31). An external valuation may provide that fair value, but the entity must check that it complies with IFRS 13 (measurement basis, date).","es":""},"common_error":{"fr":"","en":"Adopting a valuer's figure without analysing its measurement basis and date against IFRS 13.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"IAS 36 Impairment of Assets.","es":""},"correct":false,"feedback":{"fr":"","en":"IAS 36 deals with impairment (recoverable amount, impairment losses), not with determining the fair value used for a revaluation. The confusion is common because both standards apply to the same assets: IAS 36 is used to assess an impairment loss (IAS 16, para. 63), whereas IAS 16 defines fair value by reference to IFRS 13 (IAS 16, para. 6). Rule to remember: fair value for a revaluation, IFRS 13; impairment test, IAS 36.","es":""}},{"id":"B","text":{"fr":"","en":"IAS 40 Investment Property.","es":""},"correct":false,"feedback":{"fr":"","en":"IAS 40 covers investment property; it is not the reference for measuring the fair value of land and buildings used by the entity. For the revaluation model, IAS 16 defines fair value by reference to IFRS 13 (IAS 16, para. 6), and the asset is carried at that fair value at the revaluation date, less subsequent depreciation and impairment losses (IAS 16, para. 31). Rule to remember: the fair value measurement framework is IFRS 13, whatever the standard governing the asset.","es":""}},{"id":"C","text":{"fr":"","en":"IFRS 13 Fair Value Measurement.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"None: fair value is whatever the appointed valuer reports, without further analysis.","es":""},"correct":false,"feedback":{"fr":"","en":"A valuation report is a means of obtaining a fair value, not a standard: the entity must check that the value received complies with the IFRS 13 framework, in particular its measurement basis and date. IAS 16 defines fair value by reference to IFRS 13 (IAS 16, para. 6). A report prepared at another date or on another basis would distort the revalued amount (IAS 16, para. 31). Rule to remember: an expert's opinion is checked against IFRS 13, not adopted without analysis.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000019","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.IAS36_LINK"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000019","tested_point":"QST.IAS16.000019","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"ias36-link"},"references":["IAS 16 §63"],"exercise":{"prompt":{"fr":"","en":"At the reporting date, an entity notes the following facts about an industrial press measured under the cost model. Which one requires IAS 36 to be applied to determine whether the press is impaired?","es":""},"explanation":{"fr":"","en":"To determine whether an item of property, plant and equipment is impaired, the entity applies IAS 36 (IAS 16, para. 63). Physical damage reducing the asset's capacity is an indicator of impairment: the entity then estimates the recoverable amount and recognises a loss if the carrying amount exceeds it. The other facts are normal and do not trigger a test.","es":""},"common_error":{"fr":"","en":"Overlooking an impairment indicator (physical damage, drop in output) and not applying IAS 36 to the asset concerned.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The press has been serviced under the usual maintenance plan.","es":""},"correct":false,"feedback":{"fr":"","en":"Maintenance carried out under the usual plan is an ordinary event: it does not point to an impairment loss and does not by itself lead to applying IAS 36. By contrast, the fire that halves the press's output is physical damage, which signals possible impairment: it is what leads to applying IAS 36 to determine whether the asset is impaired (IAS 16, para. 63). Rule to remember: the entity applies IAS 36 to determine whether an item of property, plant and equipment is impaired (IAS 16, para. 63).","es":""}},{"id":"B","text":{"fr":"","en":"The fair value of comparable presses has risen slightly on the second-hand market.","es":""},"correct":false,"feedback":{"fr":"","en":"A rise in the fair value of comparable presses points the opposite way to an impairment loss: a more favourable market does not indicate that the press is impaired. The fact that leads to applying IAS 36 is the fire, which damaged the press and halved its output (IAS 16, para. 63). Rule to remember: physical damage that reduces an asset's capacity is an indicator of impairment; a rise in the market value of comparable assets points the other way.","es":""}},{"id":"C","text":{"fr":"","en":"This year's depreciation charge is in line with the original schedule.","es":""},"correct":false,"feedback":{"fr":"","en":"A charge in line with the original plan only shows that the depreciation assumptions have not changed: it does not signal an impairment loss. Depreciation allocates the depreciable amount systematically over the useful life (IAS 16, para. 50), whereas the question of impairment falls under IAS 36, which the entity applies to determine whether the asset is impaired (IAS 16, para. 63), as after the fire. Rule to remember: a depreciation charge in line with the plan is not, in itself, an indicator of impairment.","es":""}},{"id":"D","text":{"fr":"","en":"A fire has damaged the press, which now runs at half its previous speed.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000020","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.DISPOSAL_DATE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000020","tested_point":"QST.IAS16.000020","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":75,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"disposal-date"},"references":["IAS 16 §69"],"exercise":{"prompt":{"fr":"","en":"An entity signs a contract to sell a machine on 15 November. The buyer pays a deposit on 30 November, takes possession of the machine, assumes its risks and starts using it on 10 January, the date on which it obtains control. What is the date of disposal of the machine?","es":""},"explanation":{"fr":"","en":"The date of disposal of an item of property, plant and equipment is the date the recipient obtains control of it, determined in accordance with the IFRS 15 requirements for satisfying a performance obligation (IAS 16, para. 69). Here control passes on 10 January: the machine remains an asset and continues to be depreciated until then, unless it has first been classified as held for sale.","es":""},"common_error":{"fr":"","en":"Taking the contract signing date (or the deposit date) rather than the date the buyer obtains control as the machine's disposal date.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"15 November, the date the contract is signed.","es":""},"correct":false,"feedback":{"fr":"","en":"Signing the contract creates a commitment but does not transfer control of the machine: on that date the buyer does not yet control it. The date of disposal is the date the recipient obtains control, determined under the IFRS 15 requirements (IAS 16, para. 69), here 10 January. The machine therefore stays on the balance sheet, and keeps being depreciated, until that date. Rule to remember: signing is not transferring control.","es":""}},{"id":"B","text":{"fr":"","en":"30 November, the date of the deposit.","es":""},"correct":false,"feedback":{"fr":"","en":"A deposit shows a financial commitment by the buyer, not a transfer of control. The date of disposal is the date the recipient obtains control (IAS 16, para. 69), here 10 January, when the buyer obtains control of the machine. Receiving the deposit on 30 November is therefore not enough to derecognise the machine. Rule to remember: a payment, even a partial one, does not prove that control has transferred.","es":""}},{"id":"C","text":{"fr":"","en":"10 January, the date the buyer obtains control of the machine.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"The date the balance of the price is collected, because derecognition only occurs once the consideration has been received in full.","es":""},"correct":false,"feedback":{"fr":"","en":"The criterion in the standard is not full receipt of the price, but the transfer of control to the recipient, assessed under the IFRS 15 requirements for satisfying a performance obligation (IAS 16, para. 69). Here control passes on 10 January, whether the balance of the price has been received or is still outstanding. Rule to remember: the disposal date follows the transfer of control, not the payment schedule.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000021","standard_id":"IAS16","concept_ids":["IAS16.SCOPE.EXCLUSIONS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000021","tested_point":"QST.IAS16.000021","difficulty":"BEGINNER","source":"V1","format":"MULTIPLE_CHOICE","estimated_time_s":90,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000002","section_id":"exclusions"},"references":["IAS 16 §3"],"exercise":{"prompt":{"fr":"","en":"Which of the following are excluded from the scope of IAS 16? (Select all that apply.)","es":""},"explanation":{"fr":"","en":"IAS 16 does not apply to assets held for sale (IFRS 5), biological assets related to agricultural activity other than bearer plants (IAS 41), the recognition and measurement of exploration and evaluation assets (IFRS 6), or mineral rights and mineral reserves. It does, however, apply to items used to develop or maintain those activities (IAS 16, para. 3).","es":""},"common_error":{"fr":"","en":"Continuing to apply IAS 16 to an asset classified as held for sale, for example by carrying on depreciating it.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"A non-current asset classified as held for sale.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Equipment used to develop and maintain a mine.","es":""},"correct":false,"feedback":{"fr":"","en":"Equipment used to operate and service a mine is not excluded. Although mineral rights and mineral reserves are outside the scope of IAS 16, the standard still applies to items used to develop or maintain those activities (IAS 16, para. 3). A mining excavator is therefore property, plant and equipment. Rule to remember: mineral rights excluded, operating equipment included.","es":""}},{"id":"C","text":{"fr":"","en":"Mineral rights and mineral reserves such as oil and natural gas.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"Bearer plants such as vines or oil palms.","es":""},"correct":false,"feedback":{"fr":"","en":"Bearer plants, such as vines or oil palms, are within the scope of IAS 16: the exclusion covers biological assets related to agricultural activity other than bearer plants (IAS 16, para. 3). A vineyard is therefore an item of property, plant and equipment, not a biological asset under IAS 41. Rule to remember: bearer plants remain within IAS 16; the exclusion covers the other biological assets related to agricultural activity (IAS 16, para. 3).","es":""}},{"id":"E","text":{"fr":"","en":"Delivery trucks used by a distribution company.","es":""},"correct":false,"feedback":{"fr":"","en":"A distribution company's delivery trucks are ordinary items of property, plant and equipment: held for the entity's activity and used over several periods, they are within the scope of IAS 16, which applies to property, plant and equipment unless another standard requires or permits a different treatment (IAS 16, para. 2). None of the exclusions listed in paragraph 3 concerns them. Rule to remember: IAS 16 applies unless another standard provides a different treatment (IAS 16, para. 2); paragraph 3 lists specific exclusions (IFRS 5, IAS 41 other than bearer plants, IFRS 6, mineral rights).","es":""}},{"id":"F","text":{"fr":"","en":"Biological assets related to agricultural activity other than bearer plants.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000022","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000022","tested_point":"QST.IAS16.000022","difficulty":"BEGINNER","source":"V1","format":"MULTIPLE_CHOICE","estimated_time_s":90,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"included-costs"},"references":["IAS 16 §16","IAS 16 §17"],"exercise":{"prompt":{"fr":"","en":"An entity acquires a packaging line. Which expenditures are directly attributable costs to be included in the cost of the asset? (Select all that apply.)","es":""},"explanation":{"fr":"","en":"Cost comprises the purchase price and any costs directly attributable to bringing the asset to the location and condition necessary for it to operate as intended (IAS 16, para. 16). Directly attributable costs include site preparation, initial delivery and handling, installation and assembly, testing whether the asset functions properly and professional fees (IAS 16, para. 17). Training and general overheads remain expenses.","es":""},"common_error":{"fr":"","en":"Leaving out a directly attributable cost (fees, installation, site preparation) and expensing it.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Fees of the engineer who supervised the installation.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Training the operators who will use the line.","es":""},"correct":false,"feedback":{"fr":"","en":"Operator training is not necessary to bring the line to the location and condition for it to operate as intended (IAS 16, para. 16(b)) and is not among the examples of directly attributable costs (IAS 16, para. 17), unlike fees, installation and assembly. It is therefore expensed for the period and is not added to the cost of the line. Rule to remember: only what is necessary to get the asset ready to operate is part of its cost (IAS 16, paras. 16 and 17).","es":""}},{"id":"C","text":{"fr":"","en":"Preparing the workshop floor to receive the line.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"A share of the accounting department's general overheads.","es":""},"correct":false,"feedback":{"fr":"","en":"A share of the accounting department's overheads is not a cost directly attributable to the line: administrative and general overheads are among the excluded costs (IAS 16, para. 19), whereas cost comprises the purchase price and directly attributable costs (IAS 16, para. 16). Allocating overheads to the line would inflate the asset and wrongly reduce the period's expenses. Rule to remember: administrative and general overheads are among the costs excluded from cost (IAS 16, para. 19).","es":""}},{"id":"E","text":{"fr":"","en":"Installation and assembly costs charged by the supplier.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000023","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.EXCLUDED_COSTS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000023","tested_point":"QST.IAS16.000023","difficulty":"INTERMEDIATE","source":"V1","format":"MULTIPLE_CHOICE","estimated_time_s":90,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"excluded-costs"},"references":["IAS 16 §19"],"exercise":{"prompt":{"fr":"","en":"A restaurant chain opens a new site. Which of the following expenditures must be recognised as expenses rather than included in the cost of the site's property, plant and equipment? (Select all that apply.)","es":""},"explanation":{"fr":"","en":"Costs of opening a new facility, costs of introducing a new product or service (advertising and promotion), costs of conducting business in a new location or with a new class of customer (including staff training) and administration and general overheads are not costs of an item of property, plant and equipment (IAS 16, para. 19). Transport, handling and testing remain directly attributable.","es":""},"common_error":{"fr":"","en":"Capitalising staff training, advertising or inauguration costs in the cost of the installations at a new site.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Testing that the cold room functions properly before it is brought into use.","es":""},"correct":false,"feedback":{"fr":"","en":"Testing the cold room before it enters service is not to be expensed: these are directly attributable costs, which form part of the cost of the asset, because they serve to assess the technical and physical performance of the asset before use (IAS 16, para. 17). This expenditure is therefore capitalised, not expensed. Rule to remember: testing whether the asset functions properly before it enters service is part of cost (IAS 16, para. 17).","es":""}},{"id":"B","text":{"fr":"","en":"The advertising campaign announcing the opening.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"Initial transport and handling of the professional ovens.","es":""},"correct":false,"feedback":{"fr":"","en":"Transport and initial handling of the ovens are directly attributable delivery costs: they form part of cost and are capitalised, so they must not be expensed (IAS 16, para. 17). They are necessary to bring the ovens to the place where they will be used. Rule to remember: delivery and initial handling go into cost; opening, advertising and training are expensed.","es":""}},{"id":"D","text":{"fr":"","en":"The launch evening organised for the opening of the site.","es":""},"correct":true},{"id":"E","text":{"fr":"","en":"Training of the floor staff hired for the new site.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000024","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.USEFUL_LIFE"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000024","tested_point":"QST.IAS16.000024","difficulty":"BEGINNER","source":"V1","format":"MULTIPLE_CHOICE","estimated_time_s":90,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000012","section_id":"useful-life"},"references":["IAS 16 §56","IAS 16 §57"],"exercise":{"prompt":{"fr":"","en":"Which factors does an entity consider when estimating the useful life of an item of property, plant and equipment? (Select all that apply.)","es":""},"explanation":{"fr":"","en":"When estimating useful life, the entity considers expected usage, expected physical wear and tear, technical or commercial obsolescence and legal or similar limits (IAS 16, para. 56). Useful life is defined by the asset's expected utility to the entity and may be shorter than its economic life, for example if the entity disposes of assets after a specified period (IAS 16, para. 57).","es":""},"common_error":{"fr":"","en":"Using the maximum physical life (or the tax period) instead of the useful life expected by the entity.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The depreciation period allowed by the tax authorities.","es":""},"correct":false,"feedback":{"fr":"","en":"The depreciation period allowed by the tax authority is not a factor in estimating useful life. Useful life rests on the expected utility of the asset to the entity: usage, physical wear, obsolescence, legal limits (IAS 16, paras. 56 and 57). A five-year tax period may differ from the period over which the entity actually expects to use the asset. Rule to remember: useful life is the entity's own estimate, not a period set by a tax schedule.","es":""}},{"id":"B","text":{"fr":"","en":"Technical or commercial obsolescence.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The expected usage of the asset, assessed by reference to its expected capacity or output.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"Expected physical wear and tear, given the number of shifts and the maintenance programme.","es":""},"correct":true},{"id":"E","text":{"fr":"","en":"Legal or similar limits on the use of the asset, such as the expiry of a lease.","es":""},"correct":true},{"id":"F","text":{"fr":"","en":"The asset's maximum physical life, even if the entity plans to dispose of it much earlier.","es":""},"correct":false,"feedback":{"fr":"","en":"Maximum physical life is not useful life. Useful life is defined by the expected utility of the asset to the entity and may be shorter than its economic life, for example if the entity plans to dispose of it after a given period (IAS 16, para. 57). Example: a vehicle able to run for ten years but sold after four has a useful life of four years. Rule to remember: depreciate over the period the entity expects to use the asset, not its physical life.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000025","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.ENTIRE_CLASS"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000025","tested_point":"QST.IAS16.000025","difficulty":"INTERMEDIATE","source":"V1","format":"MULTIPLE_CHOICE","estimated_time_s":90,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000009","section_id":"frequency-class-rule"},"references":["IAS 16 §36","IAS 16 §37"],"exercise":{"prompt":{"fr":"","en":"An entity wants to apply the revaluation model. Which groupings are classes of property, plant and equipment as defined in IAS 16? (Select all that apply.)","es":""},"explanation":{"fr":"","en":"If an item of property, plant and equipment is revalued, the entire class to which it belongs must be revalued (IAS 16, para. 36). A class groups assets of a similar nature and use; the standard cites land, land and buildings, machinery, ships, aircraft, motor vehicles, furniture and fixtures, office equipment and bearer plants (IAS 16, para. 37).","es":""},"common_error":{"fr":"","en":"Selectively revaluing only the assets whose value has risen, instead of the entire class to which they belong.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Furniture and fixtures.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"Motor vehicles.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"All assets acquired in the same year, whatever their nature.","es":""},"correct":false,"feedback":{"fr":"","en":"Grouping by acquisition date is not a class: a class brings together assets of a similar nature and use, whatever their purchase date (IAS 16, para. 37). Revaluing \"all assets of the year\" would mix land, vehicles and office equipment, whose values move differently. Rule to remember: a class is defined by the nature and use of the assets, not by the year of acquisition.","es":""}},{"id":"D","text":{"fr":"","en":"Land and buildings.","es":""},"correct":true},{"id":"E","text":{"fr":"","en":"Only the buildings whose market value has risen since acquisition.","es":""},"correct":false,"feedback":{"fr":"","en":"Grouping only the buildings whose value has risen amounts to picking the assets to revalue according to how their value has moved: that is selective revaluation. If an asset is revalued, the entire class to which it belongs must be revalued (IAS 16, para. 36), and a class is defined by the nature and use of the assets (IAS 16, para. 37). Rule to remember: revaluation covers the entire class, not a selection of assets that have gained value.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000026","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.CLASS_INFORMATION"],"dimension":"RULE_KNOWLEDGE","context":"V1_QST.IAS16.000026","tested_point":"QST.IAS16.000026","difficulty":"INTERMEDIATE","source":"V1","format":"MULTIPLE_CHOICE","estimated_time_s":90,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"class-information"},"references":["IAS 16 §73"],"exercise":{"prompt":{"fr":"","en":"For each class of property, plant and equipment, which information must the financial statements disclose? (Select all that apply.)","es":""},"explanation":{"fr":"","en":"For each class, the financial statements disclose the measurement bases for the gross carrying amount, the depreciation methods, the useful lives or rates, the gross carrying amount and accumulated depreciation (aggregated with accumulated impairment losses) at the beginning and end of the period, and a reconciliation of the carrying amount showing additions, disposals, depreciation and impairment losses among other movements (IAS 16, para. 73).","es":""},"common_error":{"fr":"","en":"Leaving out of the note the useful lives or depreciation rates used for each class.","es":""},"format":"MULTIPLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"A reconciliation of the carrying amount at the beginning and end of the period.","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"The measurement bases used for determining the gross carrying amount.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The market value of each individual asset, even under the cost model.","es":""},"correct":false,"feedback":{"fr":"","en":"The market value of each individual asset is not required by IAS 16 under the cost model. Disclosure is made by class: measurement bases for gross carrying amount, depreciation methods, useful lives or rates, gross carrying amount and accumulated depreciation, and the carrying amount reconciliation (IAS 16, para. 73). Requiring a market value asset by asset confuses disclosure about depreciated cost with a fair value measurement. Rule to remember: the note describes each class, it does not revalue each asset.","es":""}},{"id":"D","text":{"fr":"","en":"The names of the suppliers from whom the assets were acquired.","es":""},"correct":false,"feedback":{"fr":"","en":"Supplier names are not among the disclosures required by IAS 16. For each class, the standard requires measurement bases for gross carrying amount, depreciation methods, useful lives or rates, gross carrying amounts and accumulated depreciation, and the carrying amount reconciliation (IAS 16, para. 73). This information describes the assets and their movements, not the identity of third parties. Rule to remember: the IAS 16 note covers measurement, depreciation and movements for each class.","es":""}},{"id":"E","text":{"fr":"","en":"The depreciation methods and the useful lives or depreciation rates used.","es":""},"correct":true}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000027","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.PURCHASE_PRICE"],"dimension":"CALCULATION","context":"V1_QST.IAS16.000027","tested_point":"QST.IAS16.000027","difficulty":"BEGINNER","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"included-costs"},"references":["IAS 16 §16"],"exercise":{"prompt":{"fr":"","en":"An entity imports a machine with a list price of {list_price}. The supplier grants a trade discount of {trade_discount} on the list price. The entity pays non-refundable import duties of {import_duties} and VAT of {recoverable_vat}, which it fully recovers from the tax authorities. What purchase price should it include in the cost of the machine?","es":""},"explanation":{"fr":"","en":"The purchase price includes import duties and non-refundable taxes, after deducting trade discounts and rebates (IAS 16, para. 16): 100,000 − 5,000 (5% discount) + 4,000 (customs duties) = 99,000. Here the VAT is fully recovered: it is a receivable from the tax authority, not a cost to the entity, and it does not enter cost. Steps: start from the list price, deduct the trade discount (5% of 100,000), add the non-refundable customs duties, set aside the recoverable VAT. Trap: confusing what is a cost to the entity with what is a receivable from the tax authority. Rule to remember: the purchase price is net of trade discounts and rebates and includes non-refundable import duties and taxes (IAS 16, para. 16).","es":""},"common_error":{"fr":"","en":"Including recoverable VAT in cost (118,000).","es":""},"format":"CALCULATION","placeholders":[{"id":"list_price","value":"100000","unit":"EUR"},{"id":"trade_discount","value":"5","unit":"PERCENT"},{"id":"import_duties","value":"4000","unit":"EUR"},{"id":"recoverable_vat","value":"19000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"List price","es":""},"value":"100000","unit":"EUR"},{"label":{"fr":"","en":"Trade discount","es":""},"value":"5","unit":"PERCENT"},{"label":{"fr":"","en":"Non-refundable import duties","es":""},"value":"4000","unit":"EUR"},{"label":{"fr":"","en":"Recoverable VAT","es":""},"value":"19000","unit":"EUR"}],"steps":[{"id":"NET_COST","label":{"fr":"","en":"Purchase price to include in cost","es":""},"answer":99000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000028","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.START_DATE"],"dimension":"CALCULATION","context":"V1_QST.IAS16.000028","tested_point":"QST.IAS16.000028","difficulty":"BEGINNER","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"start-and-cessation"},"references":["IAS 16 §55"],"exercise":{"prompt":{"fr":"","en":"An entity's reporting date is 31 December. On 15 February 20X1 it receives the invoice for a machine costing {cost}, pays it on 31 May and starts production on 1 June. The machine is installed and available for use as intended from 1 April. Useful life: {useful_life}; residual value nil; straight-line method, time-apportioned. What is the depreciation charge for 20X1?","es":""},"explanation":{"fr":"","en":"Depreciation begins when the asset is available for use, that is, when it is in the location and condition necessary for it to operate as intended (IAS 16, para. 55): here 1 April, not the invoice date, the payment date or the start of production. Charge: 60,000 / 5 × 9/12 = 9,000. Steps: 1) identify the date the asset is available for use as intended (1 April); 2) count the months of the year from that date (April to December, i.e. 9 months); 3) pro-rate the annual charge of 12,000. Trap: the invoice (15 February), payment (31 May) and production start (1 June) dates do not trigger depreciation. Rule to remember: depreciation starts when the asset is available for use, not when it is invoiced, paid or actually put into production.","es":""},"common_error":{"fr":"","en":"Starting from the invoice date (10.5 months: 10,500).","es":""},"format":"CALCULATION","placeholders":[{"id":"cost","value":"60000","unit":"EUR"},{"id":"useful_life","value":"5","unit":"YEARS"}],"data":[{"label":{"fr":"","en":"Cost of the machine","es":""},"value":"60000","unit":"EUR"},{"label":{"fr":"","en":"Useful life","es":""},"value":"5","unit":"YEARS"}],"steps":[{"id":"DEPRECIATION_CHARGE","label":{"fr":"","en":"Depreciation charge for 20X1","es":""},"answer":9000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"DEPRECIATION_CHARGE","meaning":{"fr":"","en":"Depreciation charge for 20X1","es":""},"expression":"a / b * 9 / 12","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the machine","es":""},"value":60000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Useful life","es":""},"value":5,"unit":"YEARS"}],"result":9000,"unit":"EUR"}],"rationale":{"fr":"","en":"depreciation starts when the asset is available for use, not when it is invoiced, paid or actually put into production.","es":""},"references":["REF.IAS16.55"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000029","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.MEASUREMENT_TERMS"],"dimension":"CALCULATION","context":"V1_QST.IAS16.000029","tested_point":"QST.IAS16.000029","difficulty":"INTERMEDIATE","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"measurement-terms"},"references":["IAS 16 §6"],"exercise":{"prompt":{"fr":"","en":"An item of equipment has a cost of {cost}. At the reporting date, accumulated depreciation amounts to {accumulated_depreciation} and accumulated impairment losses to {accumulated_impairment}. Its residual value is estimated at {residual_value}. Calculate its carrying amount at the reporting date and its depreciable amount.","es":""},"explanation":{"fr":"","en":"Carrying amount is the amount at which the asset is recognised after deducting accumulated depreciation and accumulated impairment losses; the depreciable amount is cost less residual value (IAS 16, para. 6). Steps: carrying amount = 80,000 − 30,000 − 5,000 = 45,000; depreciable amount = 80,000 − 8,000 = 72,000. Trap: mixing the two calculations; accumulated depreciation does not enter the depreciable amount and residual value does not enter the carrying amount. Rule to remember: carrying amount = cost − accumulated depreciation − accumulated impairment losses; depreciable amount = cost − residual value.","es":""},"common_error":{"fr":"","en":"Forgetting impairment losses in the carrying amount (50,000).","es":""},"format":"CALCULATION","placeholders":[{"id":"cost","value":"80000","unit":"EUR"},{"id":"accumulated_depreciation","value":"30000","unit":"EUR"},{"id":"accumulated_impairment","value":"5000","unit":"EUR"},{"id":"residual_value","value":"8000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"Cost","es":""},"value":"80000","unit":"EUR"},{"label":{"fr":"","en":"Accumulated depreciation","es":""},"value":"30000","unit":"EUR"},{"label":{"fr":"","en":"Accumulated impairment losses","es":""},"value":"5000","unit":"EUR"},{"label":{"fr":"","en":"Estimated residual value","es":""},"value":"8000","unit":"EUR"}],"steps":[{"id":"CARRYING_AMOUNT","label":{"fr":"","en":"Carrying amount","es":""},"answer":45000,"tolerance":0,"unit":"EUR"},{"id":"DEPRECIABLE_AMOUNT","label":{"fr":"","en":"Depreciable amount","es":""},"answer":72000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"CARRYING_AMOUNT","meaning":{"fr":"","en":"Carrying amount","es":""},"expression":"a - b - c","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":80000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Accumulated depreciation","es":""},"value":30000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Accumulated impairment losses","es":""},"value":5000,"unit":"EUR"}],"result":45000,"unit":"EUR"},{"step":"DEPRECIABLE_AMOUNT","meaning":{"fr":"","en":"Depreciable amount","es":""},"expression":"a - b","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost","es":""},"value":80000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Estimated residual value","es":""},"value":8000,"unit":"EUR"}],"result":72000,"unit":"EUR"}],"rationale":{"fr":"","en":"carrying amount = cost − accumulated depreciation − accumulated impairment losses; depreciable amount = cost − residual value.","es":""},"references":["REF.IAS16.6"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000030","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.DIRECTLY_ATTRIBUTABLE"],"dimension":"CALCULATION","context":"V1_QST.IAS16.000030","tested_point":"QST.IAS16.000030","difficulty":"INTERMEDIATE","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"included-costs"},"references":["IAS 16 §16","IAS 16 §17"],"exercise":{"prompt":{"fr":"","en":"An entity acquires a press for a net purchase price of {purchase_price}. It also incurs: delivery to the site {delivery}, installation and assembly {installation}, fees of the engineer who commissioned the press {engineer_fees}, operator training {training}, advertising to launch the new products {advertising}, and an allocation of administrative overheads {admin_overheads}. What is the initial cost of the press?","es":""},"explanation":{"fr":"","en":"Cost comprises the purchase price and the directly attributable costs of bringing the asset into working condition (IAS 16, paras. 16 and 17): 200,000 + 6,000 (transport) + 9,000 (installation) + 3,000 (fees) = 218,000. Training, launch advertising and administrative overheads, i.e. 4,000 + 2,500 + 1,500 = 8,000, are among the excluded costs and are expensed (IAS 16, para. 19). Steps: for each expenditure, ask whether it is directly attributable to delivering the press and bringing it into working condition. Trap: capitalising every expenditure (226,000) or omitting the engineer's fees (215,000). Rule to remember: cost comprises the purchase price and directly attributable costs (IAS 16, paras. 16 and 17); training, commercial launch and general overheads are among the excluded costs (IAS 16, para. 19).","es":""},"common_error":{"fr":"","en":"Capitalising every expenditure (226,000).","es":""},"format":"CALCULATION","placeholders":[{"id":"purchase_price","value":"200000","unit":"EUR"},{"id":"delivery","value":"6000","unit":"EUR"},{"id":"installation","value":"9000","unit":"EUR"},{"id":"engineer_fees","value":"3000","unit":"EUR"},{"id":"training","value":"4000","unit":"EUR"},{"id":"advertising","value":"2500","unit":"EUR"},{"id":"admin_overheads","value":"1500","unit":"EUR"}],"data":[{"label":{"fr":"","en":"Net purchase price","es":""},"value":"200000","unit":"EUR"},{"label":{"fr":"","en":"Delivery to the site","es":""},"value":"6000","unit":"EUR"},{"label":{"fr":"","en":"Installation and assembly","es":""},"value":"9000","unit":"EUR"},{"label":{"fr":"","en":"Engineer's fees","es":""},"value":"3000","unit":"EUR"},{"label":{"fr":"","en":"Operator training","es":""},"value":"4000","unit":"EUR"},{"label":{"fr":"","en":"Launch advertising","es":""},"value":"2500","unit":"EUR"},{"label":{"fr":"","en":"Allocated administrative overheads","es":""},"value":"1500","unit":"EUR"}],"steps":[{"id":"INITIAL_COST","label":{"fr":"","en":"Initial cost of the asset","es":""},"answer":218000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000031","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.COMPONENTS"],"dimension":"CALCULATION","context":"V1_QST.IAS16.000031","tested_point":"QST.IAS16.000031","difficulty":"INTERMEDIATE","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000011","section_id":"components-rule"},"references":["IAS 16 §43","IAS 16 §44"],"exercise":{"prompt":{"fr":"","en":"A shipping company acquires a ferry. The cost of the hull is {hull_cost}, with a useful life of {hull_life}; the cost of the engines, significant in relation to the total cost, is {engine_cost}, with a useful life of {engine_life}. Residual values are nil; straight-line method. What is the total annual depreciation charge?","es":""},"explanation":{"fr":"","en":"Each part of an item whose cost is significant in relation to the total cost is depreciated separately (IAS 16, paras. 43 and 44). Hull: 700,000 / 20 = 35,000; engines: 300,000 / 10 = 30,000; total: 65,000. Steps: check that each part is significant (the hull accounts for 70%, the engines for 30%), depreciate each part over its own life, then add up. Trap: using the life of the main part for the whole asset; depreciating everything over 20 years (1,000,000 / 20 = 50,000) would understate annual consumption by 15,000. Rule to remember: each significant part is depreciated separately over its own useful life (IAS 16, para. 43).","es":""},"common_error":{"fr":"","en":"Depreciating the whole asset over the longest life (50,000).","es":""},"format":"CALCULATION","placeholders":[{"id":"hull_cost","value":"700000","unit":"EUR"},{"id":"hull_life","value":"20","unit":"YEARS"},{"id":"engine_cost","value":"300000","unit":"EUR"},{"id":"engine_life","value":"10","unit":"YEARS"}],"data":[{"label":{"fr":"","en":"Cost of the hull","es":""},"value":"700000","unit":"EUR"},{"label":{"fr":"","en":"Useful life of the hull","es":""},"value":"20","unit":"YEARS"},{"label":{"fr":"","en":"Cost of the engines","es":""},"value":"300000","unit":"EUR"},{"label":{"fr":"","en":"Useful life of the engines","es":""},"value":"10","unit":"YEARS"}],"steps":[{"id":"ANNUAL_DEPRECIATION","label":{"fr":"","en":"Total annual depreciation charge","es":""},"answer":65000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"ANNUAL_DEPRECIATION","meaning":{"fr":"","en":"Total annual depreciation charge","es":""},"expression":"(a / b) + (c / d)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Cost of the hull","es":""},"value":700000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Useful life of the hull","es":""},"value":20,"unit":"YEARS"},{"symbol":"c","meaning":{"fr":"","en":"Cost of the engines","es":""},"value":300000,"unit":"EUR"},{"symbol":"d","meaning":{"fr":"","en":"Useful life of the engines","es":""},"value":10,"unit":"YEARS"}],"result":65000,"unit":"EUR"}],"rationale":{"fr":"","en":"each significant part is depreciated separately over its own useful life (IAS 16, para. 43).","es":""},"references":["REF.IAS16.43","REF.IAS16.44"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000032","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.METHODS"],"dimension":"CALCULATION","context":"V1_QST.IAS16.000032","tested_point":"QST.IAS16.000032","difficulty":"INTERMEDIATE","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"methods"},"references":["IAS 16 §62"],"exercise":{"prompt":{"fr":"","en":"A site vehicle costing {cost} is depreciated using the diminishing balance method at a rate of {rate}, applied to the carrying amount at the start of each year. It is available for use from the first day of the first year. What is the depreciation charge for the second year?","es":""},"explanation":{"fr":"","en":"The diminishing balance method is one of the methods IAS 16 mentions (IAS 16, para. 62). Case convention: the 40% rate is applied to the opening carrying amount of each year. Year 1: 50,000 × 40% = 20,000, giving an opening carrying amount of 30,000 for year 2; year 2: 30,000 × 40% = 12,000. Trap: applying the rate to the original cost gives 20,000 every year, i.e. a constant charge. Rule to remember: the diminishing balance method is one of the possible methods (IAS 16, para. 62); the rate in the statement is applied here to the opening carrying amount, so the charge declines.","es":""},"common_error":{"fr":"","en":"Applying the rate to the original cost (20,000).","es":""},"format":"CALCULATION","placeholders":[{"id":"cost","value":"50000","unit":"EUR"},{"id":"rate","value":"40","unit":"PERCENT"}],"data":[{"label":{"fr":"","en":"Cost of the vehicle","es":""},"value":"50000","unit":"EUR"},{"label":{"fr":"","en":"Diminishing balance rate","es":""},"value":"40","unit":"PERCENT"}],"steps":[{"id":"YEAR_2_CHARGE","label":{"fr":"","en":"Charge for the second year","es":""},"answer":12000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000033","standard_id":"IAS16","concept_ids":["IAS16.DEPRECIATION.ANNUAL_REVIEW"],"dimension":"CALCULATION","context":"V1_QST.IAS16.000033","tested_point":"QST.IAS16.000033","difficulty":"ADVANCED","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000013","section_id":"annual-review"},"references":["IAS 16 §51"],"exercise":{"prompt":{"fr":"","en":"A machine costing {cost}, with no residual value, is depreciated on a straight-line basis over {original_life}. At the start of the fifth year, after {years_elapsed} of use, a technical review concludes that the machine will only be usable for a further {revised_remaining_life}. What annual charge should be recognised from this year onwards?","es":""},"explanation":{"fr":"","en":"Useful life is reviewed at least at each year-end; a change is a change in accounting estimate under IAS 8 (IAS 16, para. 51). Steps: carrying amount at the start of the fifth year = 120,000 − 4 × 12,000 = 72,000, spread over the revised remaining life: 72,000 / 3 = 24,000 a year. Past charges are not restated. Trap: recalculating on the original cost with the new total life (120,000 / 7, about 17,143) or restating past charges. Rule to remember: a change in useful life is a change in estimate (IAS 16, para. 51); the charge is recalculated on the remaining carrying amount and the remaining life.","es":""},"common_error":{"fr":"","en":"Spreading the original cost over the new total life (120,000 / 7).","es":""},"format":"CALCULATION","placeholders":[{"id":"cost","value":"120000","unit":"EUR"},{"id":"original_life","value":"10","unit":"YEARS"},{"id":"years_elapsed","value":"4","unit":"YEARS"},{"id":"revised_remaining_life","value":"3","unit":"YEARS"}],"data":[{"label":{"fr":"","en":"Cost","es":""},"value":"120000","unit":"EUR"},{"label":{"fr":"","en":"Original useful life","es":""},"value":"10","unit":"YEARS"},{"label":{"fr":"","en":"Years already elapsed","es":""},"value":"4","unit":"YEARS"},{"label":{"fr":"","en":"Revised remaining useful life","es":""},"value":"3","unit":"YEARS"}],"steps":[{"id":"REVISED_CHARGE","label":{"fr":"","en":"Revised annual charge","es":""},"answer":24000,"tolerance":0,"unit":"EUR"}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000034","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.GAIN_LOSS"],"dimension":"CALCULATION","context":"V1_QST.IAS16.000034","tested_point":"QST.IAS16.000034","difficulty":"BEGINNER","source":"V1","format":"NUMERICAL","estimated_time_s":180,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"gain-loss-rule"},"references":["IAS 16 §71","IAS 16 §68"],"exercise":{"prompt":{"fr":"","en":"An entity sells a forklift truck with a cost of {cost}, whose accumulated depreciation at the disposal date amounts to {accumulated_depreciation}. The sale price is {sale_price} and the costs of disposal are {disposal_costs}. What gain on disposal should be recognised in profit or loss?","es":""},"explanation":{"fr":"","en":"The gain or loss on derecognition is the difference between the net disposal proceeds and the carrying amount (IAS 16, para. 71), recognised in profit or loss and not classified as revenue (IAS 16, para. 68). Steps: carrying amount = 40,000 − 28,000 = 12,000; net proceeds = 15,000 − 1,000 = 14,000; gain = 14,000 − 12,000 = 2,000. Trap: comparing the price with the original cost (apparent loss of 25,000) or forgetting the selling costs (apparent gain of 3,000). Rule to remember: gain or loss on disposal = net proceeds − carrying amount (IAS 16, para. 71).","es":""},"common_error":{"fr":"","en":"Comparing the price with the original cost (loss of 25,000).","es":""},"format":"CALCULATION","placeholders":[{"id":"cost","value":"40000","unit":"EUR"},{"id":"accumulated_depreciation","value":"28000","unit":"EUR"},{"id":"sale_price","value":"15000","unit":"EUR"},{"id":"disposal_costs","value":"1000","unit":"EUR"}],"data":[{"label":{"fr":"","en":"Cost","es":""},"value":"40000","unit":"EUR"},{"label":{"fr":"","en":"Accumulated depreciation at the disposal date","es":""},"value":"28000","unit":"EUR"},{"label":{"fr":"","en":"Sale price","es":""},"value":"15000","unit":"EUR"},{"label":{"fr":"","en":"Costs of disposal","es":""},"value":"1000","unit":"EUR"}],"steps":[{"id":"GAIN","label":{"fr":"","en":"Gain on disposal","es":""},"answer":2000,"tolerance":0,"unit":"EUR"}],"formula":{"lines":[{"step":"GAIN","meaning":{"fr":"","en":"Gain on disposal","es":""},"expression":"(a - b) - (c - d)","variables":[{"symbol":"a","meaning":{"fr":"","en":"Sale price","es":""},"value":15000,"unit":"EUR"},{"symbol":"b","meaning":{"fr":"","en":"Costs of disposal","es":""},"value":1000,"unit":"EUR"},{"symbol":"c","meaning":{"fr":"","en":"Cost","es":""},"value":40000,"unit":"EUR"},{"symbol":"d","meaning":{"fr":"","en":"Accumulated depreciation at the disposal date","es":""},"value":28000,"unit":"EUR"}],"result":2000,"unit":"EUR"}],"rationale":{"fr":"","en":"gain or loss on disposal = net proceeds − carrying amount (IAS 16, para. 71).","es":""},"references":["REF.IAS16.71","REF.IAS16.68"]}},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000040","standard_id":"IAS16","concept_ids":["IAS16.DEFINITIONS.PPE"],"dimension":"ANALYSIS","context":"V1_QST.IAS16.000040","tested_point":"QST.IAS16.000040","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":120,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000003","section_id":"ppe-boundaries"},"references":["IAS 16 §6"],"exercise":{"prompt":{"fr":"","en":"A car dealer has recognised the items below as property, plant and equipment. Which one is a classification error?","es":""},"explanation":{"fr":"","en":"Property, plant and equipment is held for use in the production or supply of goods or services, for rental or for administrative purposes, and used during more than one period (IAS 16, para. 6). Vehicles held for sale to customers do not meet the use condition: they are inventories.","es":""},"common_error":{"fr":"","en":"Classifying as property, plant and equipment an item intended for sale in the ordinary course of business (a dealer's new vehicles).","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The showroom building in which it displays and sells vehicles.","es":""},"correct":false,"feedback":{"fr":"","en":"The showroom building is used to display and sell the vehicles, so for the entity's activity, and over many periods: it meets the definition of property, plant and equipment (IAS 16, para. 6). Its classification is therefore correct. Do not confuse the place where you sell with the item being sold: the building is used by the entity, whereas the new vehicles are intended for sale. Rule to remember: a building used durably in the entity's activity meets the definition of property, plant and equipment (IAS 16, para. 6).","es":""}},{"id":"B","text":{"fr":"","en":"New vehicles awaiting sale to customers.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The tow truck used by the workshop for its repair service.","es":""},"correct":false,"feedback":{"fr":"","en":"The tow truck is used to provide a repair service over several periods: it is held to provide services and used for more than one period, so it is property, plant and equipment (IAS 16, para. 6). A vehicle is not inventory or property, plant and equipment because of its nature, but because of its use: the same type of vehicle can be inventory at a dealer and property, plant and equipment at the business that uses it. Rule to remember: it is the intended use that classifies the item.","es":""}},{"id":"D","text":{"fr":"","en":"None: all these items are tangible assets of the entity.","es":""},"correct":false,"feedback":{"fr":"","en":"Being a tangible asset is not enough to make something property, plant and equipment: intended use decides. New vehicles awaiting sale are intended to be sold in the ordinary course of business; they do not meet the definition (IAS 16, para. 6) and are inventories. Answering \"no error\" would amount to checking only the physical nature of the items. Rule to remember: a tangible asset is not necessarily property, plant and equipment; intended use decides the classification (IAS 16, para. 6).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000041","standard_id":"IAS16","concept_ids":["IAS16.SUBSEQUENT_COSTS.DAY_TO_DAY_SERVICING"],"dimension":"ANALYSIS","context":"V1_QST.IAS16.000041","tested_point":"QST.IAS16.000041","difficulty":"INTERMEDIATE","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":120,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000005","section_id":"day-to-day-servicing"},"references":["IAS 16 §12"],"exercise":{"prompt":{"fr":"","en":"While reviewing an industrial entity's property, plant and equipment additions for the year, you note the capitalised expenditure below. Which item should have been recognised as an expense?","es":""},"explanation":{"fr":"","en":"The costs of day-to-day servicing of an item, mainly labour, consumables and possibly small parts, are not recognised in its carrying amount but in profit or loss as incurred (IAS 16, para. 12). They are often described as 'repairs and maintenance'.","es":""},"common_error":{"fr":"","en":"Capitalising day-to-day repair and maintenance costs (labour, lubricants, small parts) instead of expensing them.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The purchase of a forklift truck for the warehouse.","es":""},"correct":false,"feedback":{"fr":"","en":"Buying a forklift is not maintenance: it is the acquisition of an asset used over several periods, hence a legitimate addition to property, plant and equipment. The expenditure to spot is day-to-day servicing, which is recognised in profit or loss as incurred (IAS 16, para. 12). Rule to remember: acquiring an asset is not servicing it; day-to-day servicing is recognised in profit or loss (IAS 16, para. 12).","es":""}},{"id":"B","text":{"fr":"","en":"Installation and assembly costs of a new press.","es":""},"correct":false,"feedback":{"fr":"","en":"Installation and assembly costs are directly attributable costs: they bring the press to the location and condition necessary and form part of its cost (IAS 16, para. 17). They are not day-to-day servicing, which goes to profit or loss (IAS 16, para. 12). The mistake is to classify by the word \"costs\" rather than by the nature of the expenditure: initial set-up is capitalised, regular servicing is not. Rule to remember: installation = cost of the asset; day-to-day servicing = expense.","es":""}},{"id":"C","text":{"fr":"","en":"The monthly cost of labour, lubricants and small parts for the routine servicing of the presses.","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"The cost of a conveyor extension, built by an external contractor, that permanently increases the production capacity of the line.","es":""},"correct":false,"feedback":{"fr":"","en":"A conveyor extension that durably increases capacity is not day-to-day servicing: it provides future economic benefits and can be included in the carrying amount if the recognition criteria are met, namely probable benefits and reliably measurable cost (IAS 16, para. 7). Day-to-day servicing, by contrast, consists of labour, consumables and small parts (IAS 16, para. 12). Rule to remember: an addition that meets the criteria is capitalised; day-to-day servicing is an expense.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000042","standard_id":"IAS16","concept_ids":["IAS16.DERECOGNITION.GAIN_LOSS"],"dimension":"ANALYSIS","context":"V1_QST.IAS16.000042","tested_point":"QST.IAS16.000042","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":120,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000015","section_id":"gain-loss-rule"},"references":["IAS 16 §68","IAS 16 §71"],"exercise":{"prompt":{"fr":"","en":"A service entity sells a used machine for 12,000. The machine had a cost of 40,000 and accumulated depreciation of 30,000 at the disposal date. The accountant presented 12,000 as revenue and 10,000 as cost of sales. What is the error?","es":""},"explanation":{"fr":"","en":"The gain or loss on derecognition is the difference between the net disposal proceeds and the carrying amount (IAS 16, para. 71): 12,000 − (40,000 − 30,000) = 2,000. It is recognised in profit or loss, and gains shall not be classified as revenue (IAS 16, para. 68).","es":""},"common_error":{"fr":"","en":"Presenting the sale price of an item of property, plant and equipment as revenue, with its carrying amount as cost of sales, instead of recognising only the net gain or loss in profit or loss.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"The result should have been computed against cost, giving a loss of 28,000.","es":""},"correct":false,"feedback":{"fr":"","en":"The result on disposal is not measured against the original cost but against the carrying amount at the date of derecognition: 40,000 − 30,000 = 10,000. The result is therefore 12,000 − 10,000 = a gain of 2,000, not a loss of 28,000 (IAS 16, para. 71). Comparing the price with cost would ignore the 30,000 of depreciation already recognised. Rule to remember: result on disposal = net disposal proceeds − carrying amount (IAS 16, para. 71).","es":""}},{"id":"B","text":{"fr":"","en":"Only the net gain of 2,000 should be recognised in profit or loss, and it should not be classified as revenue.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"The proceeds of 12,000 should have been recognised in other comprehensive income.","es":""},"correct":false,"feedback":{"fr":"","en":"The disposal price is not recognised in other comprehensive income: the gain or loss on derecognition is recognised in profit or loss (IAS 16, para. 68). OCI receives other items, for example the revaluation surplus. Here, the gain of 2,000 goes to profit or loss, but without going through turnover. Rule to remember: the result on disposal goes to profit or loss, outside revenue (IAS 16, para. 68).","es":""}},{"id":"D","text":{"fr":"","en":"There is no error: the net amount in profit or loss is indeed 2,000.","es":""},"correct":false,"feedback":{"fr":"","en":"The net amount of 2,000 is right, but the presentation is wrong: gains on derecognition are not classified as revenue (IAS 16, para. 68), whereas the accountant presented 12,000 as turnover and 10,000 as cost of sales. This turnover of 12,000 artificially inflates the ordinary activity of the service entity. Rule to remember: the net gain of 2,000 is recognised in profit or loss without being classified as revenue (IAS 16, para. 68).","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000043","standard_id":"IAS16","concept_ids":["IAS16.DISCLOSURE.RECONCILIATION"],"dimension":"ANALYSIS","context":"V1_QST.IAS16.000043","tested_point":"QST.IAS16.000043","difficulty":"EXPERT","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":120,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000016","section_id":"reconciliation-rule"},"references":["IAS 16 §73"],"exercise":{"prompt":{"fr":"","en":"The carrying amount reconciliation prepared for the notes shows: opening 800,000; additions 150,000; depreciation for the year (90,000); disposals (70,000); closing 790,000. The statement of financial position shows a closing carrying amount of 835,000. The assets disposed of had a cost of 70,000 and accumulated depreciation of 45,000. What causes the difference?","es":""},"explanation":{"fr":"","en":"For each class, the financial statements present a reconciliation of the carrying amount at the beginning and end of the period, showing additions, disposals and depreciation among other movements (IAS 16, para. 73). The disposals line must therefore be expressed at carrying amount: 800,000 + 150,000 − 90,000 − 25,000 = 835,000, which agrees with the statement of financial position.","es":""},"common_error":{"fr":"","en":"Preparing a reconciliation that does not agree with the statement of financial position, for example by deducting disposals at cost instead of carrying amount.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"Additions for the year were understated by 45,000.","es":""},"correct":false,"feedback":{"fr":"","en":"Omitting 45,000 of additions would change the additions line, but nothing points to such an omission: the 45,000 difference (835,000 − 790,000) corresponds exactly to the accumulated depreciation of the assets disposed of (70,000 − 25,000). The disposals line must be expressed at carrying amount, 25,000, not at its cost of 70,000 (IAS 16, para. 73). Rule to remember: in the reconciliation, disposals are shown at their carrying amount (IAS 16, para. 73).","es":""}},{"id":"B","text":{"fr":"","en":"The depreciation charge is overstated by 45,000.","es":""},"correct":false,"feedback":{"fr":"","en":"The depreciation charge of 90,000 is not at issue: nothing in the file contradicts it. The 45,000 difference comes from the disposals line, deducted at cost (70,000) whereas the reconciliation of carrying amount must show the carrying amount of the assets disposed of, 25,000 (IAS 16, para. 73). Adjusting the depreciation charge would have no basis in the facts given. Rule to remember: the reconciliation of carrying amount must agree with the statement of financial position (IAS 16, para. 73).","es":""}},{"id":"C","text":{"fr":"","en":"Disposals were deducted at cost (70,000) instead of carrying amount (25,000).","es":""},"correct":true},{"id":"D","text":{"fr":"","en":"The opening balance must be restated by 45,000.","es":""},"correct":false,"feedback":{"fr":"","en":"The opening balance of 800,000 corresponds to the previous year's closing balance: no fact in the file justifies restating it. The 45,000 difference is explained by the disposals, deducted at their cost of 70,000 instead of their carrying amount of 25,000 (IAS 16, para. 73). Approach: when a reconciliation does not agree, first test each movement of the period before questioning the opening balance.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000046","standard_id":"IAS16","concept_ids":["IAS16.REVALUATION.INCREASE"],"dimension":"APPLICATION","context":"V1_QST.IAS16.000046","tested_point":"QST.IAS16.000046","difficulty":"EXPERT","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":240,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000010","section_id":"increase-rule"},"references":["IAS 16 §39"],"exercise":{"prompt":{"fr":"","en":"An entity applies the revaluation model to its land. A plot acquired for 300,000 was revalued to 270,000 in 20X1; the 30,000 decrease was recognised in profit or loss because there was no revaluation surplus. In 20X3, its fair value reaches 320,000. How is the 50,000 increase recognised in 20X3?","es":""},"explanation":{"fr":"","en":"An increase arising on revaluation is recognised in other comprehensive income and accumulated in the revaluation surplus; however, it is recognised in profit or loss to the extent that it reverses a decrease of the same asset previously recognised in profit or loss (IAS 16, para. 39). Here: 30,000 in profit or loss, 20,000 in OCI; over the whole period, the cumulative profit or loss effect for the land is nil and the revaluation surplus is 20,000.","es":""},"common_error":{"fr":"","en":"Recognising a revaluation increase entirely in profit or loss.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"50,000 in other comprehensive income, accumulated in the revaluation surplus.","es":""},"correct":false,"feedback":{"fr":"","en":"This answer ignores the reversal: the 30,000 decrease in 20X1 had been recognised in profit or loss because no revaluation surplus existed. An increase is recognised in other comprehensive income, but in profit or loss to the extent that it reverses a decrease of the same asset previously recognised in profit or loss (IAS 16, para. 39). So 30,000 must be taken to profit or loss and only 20,000 to OCI. Rule to remember: the increase first wipes out, in profit or loss, the earlier decrease taken to profit or loss.","es":""}},{"id":"B","text":{"fr":"","en":"30,000 in profit or loss and 20,000 in other comprehensive income.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"50,000 in profit or loss.","es":""},"correct":false,"feedback":{"fr":"","en":"Taking everything to profit or loss is the mirror-image error: only the part that reverses the earlier decrease (30,000) goes to profit or loss. The excess, 20,000, is recognised in other comprehensive income and accumulated in revaluation surplus (IAS 16, para. 39). With this entry, 20X3 profit would be overstated by 20,000 and the revaluation surplus understated by the same amount. Rule to remember: a revaluation increase goes to OCI, except up to the reversal of an earlier decrease taken to profit or loss.","es":""}},{"id":"D","text":{"fr":"","en":"20,000 in profit or loss and 30,000 in other comprehensive income.","es":""},"correct":false,"feedback":{"fr":"","en":"The split is reversed: the reversal in profit or loss is limited to the earlier decrease recognised in profit or loss, i.e. 30,000, and only the balance, 20,000, goes to OCI (IAS 16, para. 39). Putting only 20,000 in profit or loss would leave 10,000 of the earlier decrease unreversed, and placing 30,000 in OCI would wrongly accumulate in surplus an amount that must first wipe out the past loss. Rule to remember: the reversal in profit or loss equals the earlier decrease, the rest goes to OCI.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000047","standard_id":"IAS16","concept_ids":["IAS16.INITIAL_COST.CESSATION_OF_CAPITALISATION"],"dimension":"APPLICATION","context":"V1_QST.IAS16.000047","tested_point":"QST.IAS16.000047","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":240,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000001","section_id":"excluded-costs"},"references":["IAS 16 §20"],"exercise":{"prompt":{"fr":"","en":"A machine is installed and capable of operating as intended on 1 March, but production only starts on 1 May for lack of orders. The entity then incurs: 6,000 of costs during the idle period in March–April; 9,000 of initial operating losses in May while demand builds up; 4,000 to move the machine to another hall in June. What amount should be added to the cost of the machine?","es":""},"explanation":{"fr":"","en":"Recognition of costs in the carrying amount ceases when the item is in the location and condition necessary for it to operate as intended (IAS 16, para. 20), here on 1 March. Excluded are: costs incurred while an item ready for use has yet to be brought into use or is operated below full capacity, initial operating losses, and relocation or reorganisation costs. None of the three amounts is therefore capitalised.","es":""},"common_error":{"fr":"","en":"Capitalising initial operating losses, under-utilisation or relocation costs incurred after the date the machine is ready to operate.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"0","es":""},"correct":true},{"id":"B","text":{"fr":"","en":"6,000","es":""},"correct":false,"feedback":{"fr":"","en":"The 6,000 of idle costs in March-April are incurred while the machine is ready but not yet used: they are not added to cost (IAS 16, para. 20). Capitalisation stops when the asset is in the location and condition necessary (1 March), not when production starts (1 May). The 6,000 are therefore expenses of the period. Rule to remember: the date that counts is when the asset is ready, not when it is actually put to use.","es":""}},{"id":"C","text":{"fr":"","en":"15,000","es":""},"correct":false,"feedback":{"fr":"","en":"15,000 adds the 6,000 of idle costs and the 9,000 of initial operating losses. Neither is added to cost: the first is incurred while the asset is ready but unused, the second is an initial operating loss (IAS 16, para. 20). Demand building up slowly is not a cost of bringing the machine into condition. Rule to remember: under-utilisation and start-up losses are expenses, not part of the cost of the asset.","es":""}},{"id":"D","text":{"fr":"","en":"19,000","es":""},"correct":false,"feedback":{"fr":"","en":"19,000 capitalises all three amounts, including the 4,000 for moving the machine to another hall in June. Relocation or reorganisation costs are also excluded from cost (IAS 16, para. 20), just like the 6,000 and the 9,000. After the date the asset is ready, none of these expenditures is added to cost. Rule to remember: after 1 March nothing is added to cost; relocation and reorganisation are expenses.","es":""}}]},"scope":"CORE_STUDENT"},{"key":"QST.IAS16.000048","standard_id":"IAS16","concept_ids":["IAS16.IMPAIRMENT.THIRD_PARTY_COMPENSATION"],"dimension":"APPLICATION","context":"V1_QST.IAS16.000048","tested_point":"QST.IAS16.000048","difficulty":"ADVANCED","source":"V1","format":"SINGLE_CHOICE","estimated_time_s":240,"lesson_id":null,"review":{"standard_id":"IAS16","lesson_id":"LS.IAS16.000014","section_id":"compensation"},"references":["IAS 16 §65","IAS 16 §66"],"exercise":{"prompt":{"fr":"","en":"An entity's reporting date is 31 December 20X1. In October 20X1, a fire destroys a warehouse with a carrying amount of 40,000. On 10 December 20X1, the insurer agrees in writing to pay compensation of 55,000, paid in January 20X2. A replacement warehouse will be built in 20X2. What treatment applies in the 20X1 financial statements?","es":""},"explanation":{"fr":"","en":"Compensation from third parties for items that were impaired, lost or given up is recognised in profit or loss when it becomes receivable (IAS 16, para. 65). The impairment or loss of the item, the compensation, and the purchase or construction of a replacement item are separate economic events, accounted for separately (IAS 16, para. 66).","es":""},"common_error":{"fr":"","en":"Offsetting the insurer's compensation against the cost of the replacement warehouse.","es":""},"format":"SINGLE_CHOICE","options":[{"id":"A","text":{"fr":"","en":"A 40,000 loss in 20X1; the 55,000 compensation in profit or loss in 20X2, when received.","es":""},"correct":false,"feedback":{"fr":"","en":"Deferring the compensation to 20X2, when it is collected, delays its recognition: compensation is recognised in profit or loss when it becomes receivable (IAS 16, para. 65). Case assumption: the insurer's written agreement of 10 December 20X1 makes the compensation receivable on that date; the January payment is merely a settlement. The loss of 40,000 and the compensation of 55,000 therefore belong to the same period. Rule to remember: compensation is recognised when it becomes receivable, not when it is collected (IAS 16, para. 65).","es":""}},{"id":"B","text":{"fr":"","en":"A 40,000 loss and 55,000 of compensation income, recognised separately in profit or loss for 20X1.","es":""},"correct":true},{"id":"C","text":{"fr":"","en":"No entry in 20X1; the compensation will be deducted from the cost of the replacement warehouse.","es":""},"correct":false,"feedback":{"fr":"","en":"Offsetting the compensation against the cost of the replacement warehouse mixes separate events: the loss of the asset, the compensation and the construction of a replacement asset are accounted for separately (IAS 16, para. 66). The destroyed warehouse is therefore derecognised in 20X1, with a loss of 40,000 (IAS 16, para. 67), and the replacement warehouse will be recognised at its own cost in 20X2. Recording nothing in 20X1 would leave a destroyed asset on the balance sheet. Rule to remember: the compensation is not deducted from the cost of the replacement asset.","es":""}},{"id":"D","text":{"fr":"","en":"55,000 of compensation income in 20X1; the warehouse remains recognised until it is rebuilt.","es":""},"correct":false,"feedback":{"fr":"","en":"A warehouse destroyed by fire no longer provides economic benefits: it must be derecognised (IAS 16, para. 67), with a loss of 40,000 in 20X1. Keeping it on the balance sheet until it is rebuilt mixes the loss of the asset and the replacement asset, which are separate economic events (IAS 16, para. 66). Recording only the 55,000 income would inflate 20X1 profit. Rule to remember: a destroyed asset leaves the balance sheet without waiting for its replacement.","es":""}}]},"scope":"CORE_STUDENT"}],"reviewTitles":{"LX.IAS16.000001":"Initial cost of an item of property, plant and equipment — The starting point: cost","LX.IAS16.000002":"Initial cost of an item of property, plant and equipment — What goes into cost","LX.IAS16.000003":"Initial cost of an item of property, plant and equipment — What goes into cost","LX.IAS16.000004":"Initial cost of an item of property, plant and equipment — What is expensed, and when to stop","LX.IAS16.000005":"Initial cost of an item of property, plant and equipment — Example: an industrial bakery oven","LX.IAS16.000006":"Initial cost of an item of property, plant and equipment — What is expensed, and when to stop","LX.IAS16.000007":"Initial cost of an item of property, plant and equipment — What goes into cost","LX.IAS16.000008":"Initial cost of an item of property, plant and equipment — Worked calculation: a laser cutting machine","LX.IAS16.000009":"Initial cost of an item of property, plant and equipment — How to determine initial cost, line by line","LX.IAS16.000010":"Initial cost of an item of property, plant and equipment — Example: an industrial bakery oven","LX.IAS16.000011":"Initial cost of an item of property, plant and equipment — What is expensed, and when to stop","LX.IAS16.000012":"Initial cost of an item of property, plant and equipment — How to determine initial cost, line by line","LX.IAS16.000013":"Initial cost of an item of property, plant and equipment — The most frequent mistakes","LX.IAS16.000014":"Initial cost of an item of property, plant and equipment — Worked calculation: a laser cutting machine","LX.IAS16.000015":"Initial cost of an item of property, plant and equipment — Worked calculation: a laser cutting machine","LX.IAS16.000016":"Initial cost of an item of property, plant and equipment — The corresponding entry","LX.IAS16.000017":"Initial cost of an item of property, plant and equipment — The corresponding entry","LX.IAS16.000018":"Initial cost of an item of property, plant and equipment — Professional judgment: \"directly attributable\" and \"ready to operate\"","LX.IAS16.000019":"Objective and scope of IAS 16 — … except four excluded categories","LX.IAS16.000020":"Objective and scope of IAS 16 — … except four excluded categories","LX.IAS16.000021":"Objective and scope of IAS 16 — Bearer plants: the plant in IAS 16, the fruit in IAS 41","LX.IAS16.000022":"Objective and scope of IAS 16 — Bearer plants: the plant in IAS 16, the fruit in IAS 41","LX.IAS16.000023":"Objective and scope of IAS 16 — Bearer plants: the plant in IAS 16, the fruit in IAS 41","LX.IAS16.000024":"Objective and scope of IAS 16 — Investment property at cost: a borrowed model","LX.IAS16.000025":"Objective and scope of IAS 16 — Professional judgment: changes of category and boundaries","LX.IAS16.000026":"Objective and scope of IAS 16 — How to determine the applicable standard","LX.IAS16.000027":"Objective and scope of IAS 16 — What is IAS 16 for?","LX.IAS16.000028":"What is property, plant and equipment? The vocabulary of measurement — The boundary with inventories and intangible assets","LX.IAS16.000029":"What is property, plant and equipment? The vocabulary of measurement — Three questions to recognise property, plant and equipment","LX.IAS16.000030":"What is property, plant and equipment? The vocabulary of measurement — The sequence, step by step","LX.IAS16.000031":"What is property, plant and equipment? The vocabulary of measurement — Worked example: from cost to carrying amount","LX.IAS16.000032":"What is property, plant and equipment? The vocabulary of measurement — Worked example: from cost to carrying amount","LX.IAS16.000033":"What is property, plant and equipment? The vocabulary of measurement — Points to watch","LX.IAS16.000034":"What is property, plant and equipment? The vocabulary of measurement — The vocabulary of measurement","LX.IAS16.000035":"What is property, plant and equipment? The vocabulary of measurement — Three questions to recognise property, plant and equipment","LX.IAS16.000036":"What is property, plant and equipment? The vocabulary of measurement — The corresponding entries","LX.IAS16.000037":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — The two recognition criteria","LX.IAS16.000038":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — Professional judgment and the working paper","LX.IAS16.000039":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — Spare parts, stand-by and servicing equipment: asset or inventory?","LX.IAS16.000040":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — The corresponding entries","LX.IAS16.000041":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — The unit of account: group or separate?","LX.IAS16.000042":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — Professional judgment and the working paper","LX.IAS16.000043":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — Safety and environmental equipment","LX.IAS16.000044":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — Points to watch","LX.IAS16.000045":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — Worked example: a brewery’s investments","LX.IAS16.000046":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — The two recognition criteria","LX.IAS16.000047":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — Analysing an expenditure, step by step","LX.IAS16.000048":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Day-to-day servicing: expensed","LX.IAS16.000049":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Day-to-day servicing: expensed","LX.IAS16.000050":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Replacing a part: bring in the new, take out the old","LX.IAS16.000051":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Worked example: replacing a furnace lining","LX.IAS16.000052":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Entries: replacement of the lining","LX.IAS16.000053":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Major inspections: a component in its own right","LX.IAS16.000054":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Worked example and entry: a ship's dry-docking","LX.IAS16.000055":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Worked example and entry: a ship's dry-docking","LX.IAS16.000056":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Points to watch","LX.IAS16.000057":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Three families of subsequent expenditure","LX.IAS16.000058":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Professional judgment: where is the boundary?","LX.IAS16.000059":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Worked example: a treatment plant platform","LX.IAS16.000060":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — The commissioning entry","LX.IAS16.000061":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — The rule: dismantling is part of cost","LX.IAS16.000062":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Professional judgment and documentation","LX.IAS16.000064":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Worked example and entries: the bottling line in trials","LX.IAS16.000065":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Worked example and entries: the bottling line in trials","LX.IAS16.000066":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Incidental operations: in profit or loss","LX.IAS16.000067":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Incidental operations: in profit or loss","LX.IAS16.000068":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Worked example: the warehouse built by the works division","LX.IAS16.000069":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Assets built by the entity","LX.IAS16.000070":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Professional judgment and documentation","LX.IAS16.000071":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Assets built by the entity","LX.IAS16.000072":"Deferred payment, exchanges of assets and government grants — Worked example: a machine payable in two years","LX.IAS16.000073":"Deferred payment, exchanges of assets and government grants — The deferred payment entries","LX.IAS16.000074":"Deferred payment, exchanges of assets and government grants — Deferred payment: the cash price equivalent","LX.IAS16.000075":"Deferred payment, exchanges of assets and government grants — The deferred payment entries","LX.IAS16.000076":"Deferred payment, exchanges of assets and government grants — Method: handling an exchange in five questions","LX.IAS16.000077":"Deferred payment, exchanges of assets and government grants — Worked example: trucks for an excavator","LX.IAS16.000078":"Deferred payment, exchanges of assets and government grants — Worked example: trucks for an excavator","LX.IAS16.000079":"Deferred payment, exchanges of assets and government grants — Exchanges of assets: fair value or carrying amount","LX.IAS16.000080":"Deferred payment, exchanges of assets and government grants — Exchanges of assets: fair value or carrying amount","LX.IAS16.000081":"Deferred payment, exchanges of assets and government grants — Exchanges of assets: fair value or carrying amount","LX.IAS16.000082":"Deferred payment, exchanges of assets and government grants — Government grants: the cross-reference to IAS 20","LX.IAS16.000083":"Deferred payment, exchanges of assets and government grants — Government grants: the cross-reference to IAS 20","LX.IAS16.000084":"Deferred payment, exchanges of assets and government grants — When an acquisition is not just a cash payment","LX.IAS16.000085":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — The rule: a policy choice, by class","LX.IAS16.000086":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — Professional judgment and documentation","LX.IAS16.000087":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — Points of attention","LX.IAS16.000088":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — Worked example: the carrying amount of a press","LX.IAS16.000089":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — The cost model","LX.IAS16.000090":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — Worked example: revising the dismantling of an antenna site","LX.IAS16.000091":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — The revision entries","LX.IAS16.000092":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — Method: dealing with a revision under the cost model","LX.IAS16.000093":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — Revising the decommissioning provision: IFRIC 1","LX.IAS16.000094":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — Revising the decommissioning provision: IFRIC 1","LX.IAS16.000095":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — A targeted option: owner-occupied property backing participating insurance contracts","LX.IAS16.000099":"The revaluation model: conditions, fair value, frequency and the entire class — The rule: sufficient frequency and the entire class","LX.IAS16.000100":"The revaluation model: conditions, fair value, frequency and the entire class — The rule: reliable fair value and revalued amount","LX.IAS16.000101":"The revaluation model: conditions, fair value, frequency and the entire class — The rule: reliable fair value and revalued amount","LX.IAS16.000102":"The revaluation model: conditions, fair value, frequency and the entire class — Professional judgment: the external valuation, frequency and the boundaries of classes","LX.IAS16.000103":"The revaluation model: conditions, fair value, frequency and the entire class — The rule: sufficient frequency and the entire class","LX.IAS16.000104":"The revaluation model: conditions, fair value, frequency and the entire class — The rule: sufficient frequency and the entire class","LX.IAS16.000105":"The revaluation model: conditions, fair value, frequency and the entire class — Simple example: a hotel group and its classes","LX.IAS16.000106":"The revaluation model: conditions, fair value, frequency and the entire class — Professional judgment: the external valuation, frequency and the boundaries of classes","LX.IAS16.000107":"The revaluation model: conditions, fair value, frequency and the entire class — Numeric example: a building revalued under both approaches","LX.IAS16.000108":"The revaluation model: conditions, fair value, frequency and the entire class — The entries under each approach","LX.IAS16.000109":"The revaluation model: conditions, fair value, frequency and the entire class — The entries under each approach","LX.IAS16.000110":"The revaluation model: conditions, fair value, frequency and the entire class — How to apply the model step by step","LX.IAS16.000111":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — The rule for an increase","LX.IAS16.000112":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — The rule for a decrease","LX.IAS16.000113":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — The rule for a decrease","LX.IAS16.000114":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — Simple example: land that falls, rises again, then is sold","LX.IAS16.000115":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — The rule for an increase","LX.IAS16.000116":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — The entries for the building, from N+3 to N+5","LX.IAS16.000117":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — What happens to the revaluation surplus? Transfer to retained earnings","LX.IAS16.000118":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — What happens to the revaluation surplus? Transfer to retained earnings","LX.IAS16.000119":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — Points of attention","LX.IAS16.000120":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — Tax effects: a cross-reference to IAS 12","LX.IAS16.000121":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — Tax effects: a cross-reference to IAS 12","LX.IAS16.000122":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — Professional judgment: asset-by-asset tracking, transfer policy, history","LX.IAS16.000123":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — An increase and a decrease are not treated the same way","LX.IAS16.000124":"Depreciating by component and recognising the charge — The rule: break down, group, leave nothing out","LX.IAS16.000125":"Depreciating by component and recognising the charge — The rule: break down, group, leave nothing out","LX.IAS16.000126":"Depreciating by component and recognising the charge — Numeric example: an aircraft broken down into components","LX.IAS16.000127":"Depreciating by component and recognising the charge — Numeric example: an aircraft broken down into components","LX.IAS16.000128":"Depreciating by component and recognising the charge — The rule: break down, group, leave nothing out","LX.IAS16.000129":"Depreciating by component and recognising the charge — Points of attention","LX.IAS16.000130":"Depreciating by component and recognising the charge — The component-based depreciation entry","LX.IAS16.000131":"Depreciating by component and recognising the charge — Professional judgment: significance, approximation, documentation","LX.IAS16.000132":"Depreciating by component and recognising the charge — Where does the charge go? Profit or loss or the cost of another asset","LX.IAS16.000133":"Depreciating by component and recognising the charge — Entries: charge included in inventories and in an asset under construction","LX.IAS16.000134":"Depreciating by component and recognising the charge — Entries: charge included in inventories and in an asset under construction","LX.IAS16.000135":"Depreciating by component and recognising the charge — Where does the charge go? Profit or loss or the cost of another asset","LX.IAS16.000136":"Depreciating by component and recognising the charge — Entries: charge included in inventories and in an asset under construction","LX.IAS16.000137":"Depreciating by component and recognising the charge — How to break down step by step","LX.IAS16.000138":"Depreciating by component and recognising the charge — Professional judgment: significance, approximation, documentation","LX.IAS16.000139":"Depreciable amount, residual value, useful life, land and buildings — The depreciable amount: what the charge must absorb","LX.IAS16.000140":"Depreciable amount, residual value, useful life, land and buildings — The depreciable amount: what the charge must absorb","LX.IAS16.000141":"Depreciable amount, residual value, useful life, land and buildings — The residual value: an estimate at today's prices","LX.IAS16.000142":"Depreciable amount, residual value, useful life, land and buildings — The residual value: an estimate at today's prices","LX.IAS16.000143":"Depreciable amount, residual value, useful life, land and buildings — Useful life: how long the entity itself will use the asset","LX.IAS16.000144":"Depreciable amount, residual value, useful life, land and buildings — Useful life: how long the entity itself will use the asset","LX.IAS16.000145":"Depreciable amount, residual value, useful life, land and buildings — Land and buildings: two assets, two treatments","LX.IAS16.000146":"Depreciable amount, residual value, useful life, land and buildings — Numeric examples: a head office, a site to be restored, a residual value that catches up with the carrying amount","LX.IAS16.000147":"Depreciable amount, residual value, useful life, land and buildings — Land and buildings: two assets, two treatments","LX.IAS16.000148":"Depreciable amount, residual value, useful life, land and buildings — Numeric examples: a head office, a site to be restored, a residual value that catches up with the carrying amount","LX.IAS16.000149":"Depreciable amount, residual value, useful life, land and buildings — Journal entries: the charge for year N","LX.IAS16.000150":"Depreciable amount, residual value, useful life, land and buildings — Professional judgement: estimate, justify, document","LX.IAS16.000151":"Depreciation methods, start and cessation, annual review — Numeric example 1: one machine, three methods","LX.IAS16.000152":"Depreciation methods, start and cessation, annual review — Numeric example 1: one machine, three methods","LX.IAS16.000153":"Depreciation methods, start and cessation, annual review — The rule: a method that reflects the pattern of consumption","LX.IAS16.000154":"Depreciation methods, start and cessation, annual review — A prohibited method: depreciating at the pace of revenue","LX.IAS16.000155":"Depreciation methods, start and cessation, annual review — When depreciation starts and when it stops","LX.IAS16.000156":"Depreciation methods, start and cessation, annual review — When depreciation starts and when it stops","LX.IAS16.000157":"Depreciation methods, start and cessation, annual review — Numeric example 2: revising life and residual value at mid-life","LX.IAS16.000158":"Depreciation methods, start and cessation, annual review — Journal entries","LX.IAS16.000159":"Depreciation methods, start and cessation, annual review — The annual review: a change in estimate, dealt with for the future","LX.IAS16.000160":"Depreciation methods, start and cessation, annual review — When depreciation starts and when it stops","LX.IAS16.000161":"Depreciation methods, start and cessation, annual review — Simple example: three assets, three patterns","LX.IAS16.000162":"Depreciation methods, start and cessation, annual review — The annual review: a change in estimate, dealt with for the future","LX.IAS16.000163":"Depreciation methods, start and cessation, annual review — A prohibited method: depreciating at the pace of revenue","LX.IAS16.000164":"Depreciation methods, start and cessation, annual review — The annual review: a change in estimate, dealt with for the future","LX.IAS16.000165":"Impairment (by reference to IAS 36) and compensation from third parties — The rule: IAS 16 refers to IAS 36","LX.IAS16.000166":"Impairment (by reference to IAS 36) and compensation from third parties — The rule: IAS 16 refers to IAS 36","LX.IAS16.000167":"Impairment (by reference to IAS 36) and compensation from third parties — The rule: IAS 16 refers to IAS 36","LX.IAS16.000168":"Impairment (by reference to IAS 36) and compensation from third parties — After impairment: recalculated depreciation","LX.IAS16.000169":"Impairment (by reference to IAS 36) and compensation from third parties — Journal entries: four events, four entries","LX.IAS16.000170":"Impairment (by reference to IAS 36) and compensation from third parties — Compensation from third parties: three separate events","LX.IAS16.000171":"Impairment (by reference to IAS 36) and compensation from third parties — Compensation from third parties: three separate events","LX.IAS16.000172":"Impairment (by reference to IAS 36) and compensation from third parties — Journal entries: four events, four entries","LX.IAS16.000173":"Impairment (by reference to IAS 36) and compensation from third parties — Compensation from third parties: three separate events","LX.IAS16.000174":"Impairment (by reference to IAS 36) and compensation from third parties — Numeric example: the factory fire","LX.IAS16.000175":"Impairment (by reference to IAS 36) and compensation from third parties — When an asset loses value… and someone pays","LX.IAS16.000179":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — The gain or loss: one formula, one classification","LX.IAS16.000180":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — The two triggers, and what is not a trigger","LX.IAS16.000181":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — A disposal during the year, with the depreciation for the period","LX.IAS16.000182":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — The entries for the sale of the press","LX.IAS16.000183":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — Two derecognitions in a warehouse: a sale and a scrapping","LX.IAS16.000184":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — Areas of judgement and documentation","LX.IAS16.000185":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — The date of disposal: the transfer of control (IFRS 15)","LX.IAS16.000186":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — The consideration: fixed, variable, deferred or non-cash","LX.IAS16.000187":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — Special case: assets held for rental and routinely sold","LX.IAS16.000188":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — Special case: assets held for rental and routinely sold","LX.IAS16.000189":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — Special case: sale and leaseback falls under IFRS 16","LX.IAS16.000190":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — Common errors","LX.IAS16.000191":"Disclosure — For each class: bases, methods, lives, gross amount and depreciation","LX.IAS16.000192":"Disclosure — A complete reconciliation that adds up","LX.IAS16.000193":"Disclosure — Common errors","LX.IAS16.000194":"Disclosure — Encouraged disclosures","LX.IAS16.000195":"Disclosure — Constraints, commitments and proceeds before intended use","LX.IAS16.000196":"Disclosure — Constraints, commitments and proceeds before intended use","LX.IAS16.000197":"Disclosure — Changes in estimates, revaluations, impairment","LX.IAS16.000198":"Disclosure — Changes in estimates, revaluations, impairment","LX.IAS16.000199":"Disclosure — Changes in estimates, revaluations, impairment","LX.IAS16.000200":"Disclosure — Changes in estimates, revaluations, impairment","LX.IAS16.000201":"Transition provisions of amendments — The IAS 16 transition provisions in one table","LX.IAS16.000202":"Transition provisions of amendments — The IAS 16 transition provisions in one table","LX.IAS16.000203":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — Professional judgment and the working paper","LX.IAS16.000204":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — The two recognition criteria","LX.IAS16.000205":"Depreciation methods, start and cessation, annual review — The annual review: a change in estimate, dealt with for the future","LX.IAS16.000206":"Deferred payment, exchanges of assets and government grants — Method: handling an exchange in five questions","LX.IAS16.000207":"Transition provisions of amendments — How to handle the first application of an amendment","QST.IAS16.000001":"Objective and scope of IAS 16 — What is IAS 16 for?","QST.IAS16.000002":"Initial cost of an item of property, plant and equipment — The starting point: cost","QST.IAS16.000003":"Depreciable amount, residual value, useful life, land and buildings — The depreciable amount: what the charge must absorb","QST.IAS16.000004":"Depreciable amount, residual value, useful life, land and buildings — Land and buildings: two assets, two treatments","QST.IAS16.000005":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — The two triggers, and what is not a trigger","QST.IAS16.000006":"Depreciation methods, start and cessation, annual review — When depreciation starts and when it stops","QST.IAS16.000007":"The revaluation model: conditions, fair value, frequency and the entire class — The rule: reliable fair value and revalued amount","QST.IAS16.000008":"Disclosure — Changes in estimates, revaluations, impairment","QST.IAS16.000009":"Objective and scope of IAS 16 — The general rule: all property, plant and equipment…","QST.IAS16.000010":"What is property, plant and equipment? The vocabulary of measurement — The boundary with inventories and intangible assets","QST.IAS16.000011":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — The two recognition criteria","QST.IAS16.000012":"Recognising property, plant and equipment: criteria, spare parts, unit of measure, safety equipment — Spare parts, stand-by and servicing equipment: asset or inventory?","QST.IAS16.000013":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — The rule: a policy choice, by class","QST.IAS16.000014":"Choosing the measurement model; the cost model; changes in decommissioning liabilities — The cost model","QST.IAS16.000015":"Depreciable amount, residual value, useful life, land and buildings — The depreciable amount: what the charge must absorb","QST.IAS16.000016":"Depreciating by component and recognising the charge — Where does the charge go? Profit or loss or the cost of another asset","QST.IAS16.000017":"Dismantling, proceeds before intended use, incidental operations and self-constructed assets — Incidental operations: in profit or loss","QST.IAS16.000018":"The revaluation model: conditions, fair value, frequency and the entire class — The rule: reliable fair value and revalued amount","QST.IAS16.000019":"Impairment (by reference to IAS 36) and compensation from third parties — The rule: IAS 16 refers to IAS 36","QST.IAS16.000020":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — The date of disposal: the transfer of control (IFRS 15)","QST.IAS16.000021":"Objective and scope of IAS 16 — … except four excluded categories","QST.IAS16.000022":"Initial cost of an item of property, plant and equipment — What goes into cost","QST.IAS16.000023":"Initial cost of an item of property, plant and equipment — What is expensed, and when to stop","QST.IAS16.000024":"Depreciable amount, residual value, useful life, land and buildings — Useful life: how long the entity itself will use the asset","QST.IAS16.000025":"The revaluation model: conditions, fair value, frequency and the entire class — The rule: sufficient frequency and the entire class","QST.IAS16.000026":"Disclosure — For each class: bases, methods, lives, gross amount and depreciation","QST.IAS16.000027":"Initial cost of an item of property, plant and equipment — What goes into cost","QST.IAS16.000028":"Depreciation methods, start and cessation, annual review — When depreciation starts and when it stops","QST.IAS16.000029":"What is property, plant and equipment? The vocabulary of measurement — The vocabulary of measurement","QST.IAS16.000030":"Initial cost of an item of property, plant and equipment — What goes into cost","QST.IAS16.000031":"Depreciating by component and recognising the charge — The rule: break down, group, leave nothing out","QST.IAS16.000032":"Depreciation methods, start and cessation, annual review — The rule: a method that reflects the pattern of consumption","QST.IAS16.000033":"Depreciation methods, start and cessation, annual review — The annual review: a change in estimate, dealt with for the future","QST.IAS16.000034":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — The gain or loss: one formula, one classification","QST.IAS16.000040":"What is property, plant and equipment? The vocabulary of measurement — The boundary with inventories and intangible assets","QST.IAS16.000041":"After acquisition: day-to-day servicing, replacement of parts, major inspections — Day-to-day servicing: expensed","QST.IAS16.000042":"Derecognising an item of property, plant and equipment: triggers, gain or loss, date, consideration, special cases — The gain or loss: one formula, one classification","QST.IAS16.000043":"Disclosure — The carrying amount reconciliation","QST.IAS16.000046":"Increases and decreases in value, transfer of the revaluation surplus, tax effects — The rule for an increase","QST.IAS16.000047":"Initial cost of an item of property, plant and equipment — What is expensed, and when to stop","QST.IAS16.000048":"Impairment (by reference to IAS 36) and compensation from third parties — Compensation from third parties: three separate events"}}