CERTYNEX IFRS ACADEMY

An independent valuer values Ravenel at 12,000,000, whereas the carrying amount of its identifiable net assets is 8,000,000. The chief executive proposes recognising the difference of 4,000,000 as an asset in Ravenel's statement of financial position. Which answer complies with IAS 38?

Recognise the 4,000,000 as internally generated goodwill, the independent valuer's report providing a reliable measurement basis.

Allocate the 4,000,000 to Ravenel's brands and customer base, then recognise them as amortised intangible assets.

Recognise nothing: this difference does not represent the cost of intangible assets controlled by Ravenel.

Recognise the 4,000,000 as a revaluation surplus in equity, with no effect on profit or loss for the year.