Examples of items that are not investment property

Learning objectives

• Recognise excluded examples (property held for sale in the ordinary course of business, property being constructed on behalf of third parties, owner-occupied property).L1, L2

Normative references

• IAS 40 §9Examples of items that are not investment property and are outside the scope: (a) property intended for sale in the ordinary course of business or in the process of construction or development for such sale (IAS 2); (c) owner-occupied property (IAS 16; IFRS 16 for a right-of-use asset), including property held for future use as owner-occupied property, property occupied by employees and owner-occupied property awaiting disposal; (e) property leased to another entity under a finance lease. Sub-paragraphs (b) and (d) have been deleted.

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

2 questions

• A property held for sale in the ordinary course of business is an investment property.L1
• An entity comments on the classification of four properties. Which of these classifications is incorrect?L2