Non-monetary items at fair value

Learning objectives

• Translate a non-monetary item measured at fair value using the exchange rate at the date when that fair value was measured.L2, L3
• Calculate, from the case data, the translated amount or the exchange difference relating to the concept “Non-monetary at fair value, rate at measurement date (23(c))”.L2, L3

Normative references

• IAS 21 §23At the end of each subsequent reporting period: foreign currency monetary items at the closing rate; non-monetary items measured at historical cost at the exchange rate at the date of the transaction; non-monetary items measured at fair value at the exchange rate at the date when the fair value was measured.

Original summaries of the paragraphs (reference register), never a quotation of the standard.

3 questions

• Gavrel holds a plot of land abroad measured at fair value, expressed in pounds. The fair value was determined on 30 November, when the rate is 1.18 euros per 1 pound; at 31 December, the closing date, the rate is 1.20 euros. Which rate translates the fair value into euros?L2
• Mercier measures an investment property abroad at fair value: {foreign_amount}, determined at a date when the rate is 1.17 euros per 1 pound. The later closing rate is 1.21 euros. Calculate the amount in euros to use.L3
• Corbin revalues a foreign building at {foreign_amount}, the fair value being determined at a date when the rate is 0.93 euro per 1 dollar, i.e. 483,600 euros. Its carrying amount is {carrying_amount}. Case convention: the revaluation is recognised in other comprehensive income. Post the revaluation entry for the amount {revaluation_surplus}.L3