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10. Finance & accounting standards
  
  Article 101- Investment  
101.1 Investment  
  Investment property shall be recognized as an asset when, and only when:  
  (a). It is probable that the future economic benefits that are associated with the investment property will flow to the Nation;  
  (b). The cost of the investment property can be measured reliably.  
  The Nation evaluates under this recognition principle all its investment property costs at the time they are incurred. These costs include costs incurred initially to acquire an investment property and costs incurred subsequently to add to, replace part of, or service a property.  
101.2 Measurement at Recognition  
  An investment property shall be measured initially at its cost.  
  Transaction costs shall be included in the initial measurement.  
  Notwithstanding this Charter, in respect of not-for-profit entities, where an investment property is acquired at no cost or for nominal cost, its cost shall be deemed to be its fair value as at the date of acquisition.  
  The cost of an investment property is not increased by:  
  (a). Start-up costs (unless they are necessary to bring the property to the condition necessary for it to be capable of operating in the manner intended by management);  
  (b). Operating losses incurred before the investment property achieves the planned level of occupancy; or  
  (c). Abnormal amounts of wasted material, labor or other resources incurred in constructing or developing the property.  
  (d). The initial cost of a property interest held under a lease and classified as an investment property shall be as prescribed for a finance lease by this Charter of international Accounting Documents concerning Leases, that is, the asset shall be recognized at the lower of the fair value of the leased property and the present value of the minimum lease payments. An equivalent amount shall be recognized as a liability in accordance with that same in this Charter.  
101.3 Investment property valuation model  
  The Nation shall measure all of its investment property in accordance with international Accounting Documents requirements for that model, other than those that meet the criteria to be classified as held for sale (or are included in a disposal group that is classified as held for sale) in accordance with international Accounting Documents concerning Non-current Assets Held for Sale and Discontinued Operations. Investment properties that meet the criteria to be classified as held for sale (or are included in a disposal group that is classified as held for sale) shall be measured in accordance with international Accounting Documents.  
101.4 Transfers  
  Transfers to, or from, investment property shall be made when, and only when, there is a change in use, evidenced by:  
  (a) Commencement of owner-occupation, for a transfer from investment property to owner-occupied property;  
  (b) Commencement of development with a view to sale, for a transfer from investment property to inventories;  
  (c) End of owner-occupation, for a transfer from owner occupied property to investment property;  
  (d) Commencement of an operating lease to another party, for a transfer from inventories to investment property or  
  (e) End of construction or development, for a transfer from property in the course of construction or development (covered by international Accounting Documents) to investment property.  
  For a transfer from investment property carried at fair value to owner-occupied property or inventories, the property's deemed cost for subsequent accounting in accordance with international Accounting Documents or  
101.5 Fair Value Model  
  After initial recognition, the Nation that chooses the fair value model shall measure all of its investment property at fair value, except in the cases described in this Charter When a property interest held by a lessee under an operating lease is classified as an investment property under this Charter, is not elective; the fair value model shall be applied. A gain or loss arising from a change in the fair value of investment property shall be recognized in profit or loss for the period in which it arises. The fair value of investment property shall reflect market conditions at the reporting date.  
101.6 Inability to Determine Fair Value Reliably  
  There is a refutable presumption that the Nation can reliably determine the fair value of an investment property on a continuing basis. However, in exceptional cases, there is clear evidence when the Nation first acquires an investment property (or when an existing property first becomes an investment property following the completion of construction, development or after a change in use) that the fair value of the investment property is not reliably determinable on a continuing basis. This arises when, and only when, comparable market transactions are infrequent and alternative reliable estimates of fair value (for example, based on discounted cash flow projections) are not available. In such cases, the Nation shall measure that investment property using the cost model in international Accounting Documents. The residual value of the investment property shall be assumed to be zero. The Nation shall apply international Accounting Documents until disposal of the investment property.  
  If the Nation has previously measured an investment property at fair value, it shall continue to measure the property at fair value until disposal (or until the property becomes owner-occupied property or the Nation begins to develop the property for subsequent sale in the ordinary course of business) even if comparable market transactions become less frequent or market prices become less readily available.  
101.7 Inventories  
  Inventories shall be its fair value at the date of change in use.  
  (a) If an owner-occupied property becomes an investment property that will be carried at fair value, a trading organization of the Nation shall apply international Accounting Documents up to the date of change in use. The Nation shall treat any difference at that date between the carrying amount of the property in accordance with international Accounting Documents and its fair value in the same way as a revaluation in accordance with international Accounting Documents.  
  (b) For a transfer from inventories to investment property that will be carried at fair value, any difference between the fair value of the property at that date and its previous carrying amount shall be recognized in profit or loss.  
  (c) When the Nation completes the construction or development of a self-constructed investment property that will be carried at fair value, any difference between the fair value of the property at that date and its previous carrying amount shall be recognized in profit or loss.  
101.8 Disposals  
  An investment property shall be derecognized (eliminated from the balance sheet) on disposal or when:  
  (a) The investment property is permanently withdrawn from use and no future economic benefits are expected from its disposal.  
  (b) Gains or losses arising from the retirement or disposal of investment property shall be determined as the difference between the net disposal proceeds and the carrying amount of the asset and shall be recognized in profit or loss (unless international Accounting Documents requires otherwise on a sale and leaseback) in the period of the retirement or disposal.  
  (c) Compensation from third parties for investment property that was impaired, lost or given up shall be recognized in profit or loss when the compensation becomes receivable.  
     
     
     
     
     
     
     
     
     
 
 

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