We intend to change our accounting policy on land and building from “Revaluation model” to “Cost model”. IAS 16 is silent on that.

Please, what are your thoughts on this?


It is not prohibited, but it is very rare. I would say it is possible only when the cost model is more relevant than the revaluation model and you should give a good reason for this change.

The standard IAS 8 paragraph 14 permits the change in accounting policy only when it is required by IFRS or when it is more relevant. Having that said, if fair values of the related items are readily available and determinable, I cannot see how changing back to cost model would be more reliable and relevant.