Commonly asked questions from KTP | THK clients on Investment Property (IE) vs Property, Plant & Equipment (PPE): 1. What is the common errors when accounting for investment property? 2. What is the treatment of property that is partly investment and partly owner-occupied? 3. Is a hotel PPE or investment property? Full story in our blog https://lnkd.in/gKujHPRX 퐕퐢퐬퐢퐭 퐮퐬 Wisma 퐊퐓퐏, 53 Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru Wisma 퐓퐇퐊, 41, Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru 퐊퐓퐏 (퐀퐮퐝퐢퐭,퐓퐚퐱, 퐀퐝퐯퐢퐬퐨퐫퐲) An approved audit firm and licensed tax firm operating under the KTP group based in Johor Bahru providing audit, tax planning, advisory and compliance services to clients Website www.ktp.com.my Instagram https://bit.ly/3jZuZuI Linkedin https://bit.ly/3sapf4l Telegram http://bit.ly/3ptmlpn 퐓퐇퐊 (퐒퐞퐜퐫퐞퐭퐚퐫퐢퐚퐥, 퐀퐜퐜퐨퐮퐧퐭/퐏퐚퐲퐫퐨퐥퐥, 퐀퐝퐯퐢퐬퐨퐫퐲) A licensed secretarial firm in Johor Bahru providing fast reliable incorporation, secretarial services, corporate compliance services, outsource booking, accounting and payroll services to clients Website www.thks.com.my Facebook https://bit.ly/3nQ98rs

1. What is the difference
between
Investment property (MPERS 16)
&
Property, plant and equipment (MPERS 17)
AskKtpAud
AskThkAcc
14/01/22

2. Land or building (or a part of it), or both,
held for the following specific
purposes:
• To earn rentals;
• For capital appreciation; or
• Both
What is Investment Property (IP)?
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AskThkAcc
14/01/22

3. • IP shall be measured at fair value
at each reporting date.
Measurement of IP after recognition:
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12/01/22

4. • The IP shall use the cost model
if the fair value cannot be
measured reliably without
undue cost or effort
Measurement of IP after recognition:
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12/01/22

5. • Undue costs or effort means the
costs and benefits from
obtaining or determining the
information necessary to
comply with a requirement
Measurement of IP after recognition:
AskKtpAud
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12/01/22

6. • For use in production or supply of
goods or services
• For administrative purposes
• It is expected to be used during
more than one period.
What is
Property, plant and equipment (PPE)?
AskKtpAud
AskThkAcc
14/01/22

7. 1.Cost model
• Cost
less depreciation
less accumulated impairment
losses
Measurement of PPE after recognition:
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14/01/22

8. 2.Revaluation model
• Revalued amount
less accumulated depreciation
less accumulated impairment
losses
Measurement of PPE after recognition:
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14/01/22

9. What is the treatment of property that is
partly investment and partly owner
occupied?
AskKtpAcc
AskThkAcc
14/01/22

10. • Mixed use property shall be
separated between IP and PPE.
What is the treatment of property that is
partly investment and partly owner
occupied?
AskKtpAcc
AskThkAcc
14/01/22

11. • However, the entire property
shall be accounted for as PPE if
the fair value of the IP
component cannot be measured
reliably without undue costs or
effort.
What is the treatment of property that is
partly investment and partly owner
occupied?
AskKtpAcc
AskThkAcc
14/01/22