Philippine Public Sector Accounting Standards 16

INVESTMENT PROPERTY

Table of Contents

PAG
Number
BACKGROUND
INTRODUCTION TO THE IPSAS 16
PHILIPPINE APPLICATION GUIDANCE TO IPSAS 16
Scope

Measurement After Recognition

Effective Date

PPSAS Investment Property

January 2014

Page 1

Philippine Public Sector Accounting Standards 16 - INVESTMENT

PROPERTY

Background
This Philippine Public Sector Accounting Standard (PPSAS) 16 consists
of International Public Sector Accounting Standard (IPSAS) 16,
Investment Property, and the Philippine Application Guidance (PAG)
prepared to suit the Philippine public sector situation.
The IPSAS 16 was issued in December 2001 and revised in December
2006 by the International Public Sector Accounting Standards Board
(IPSASB) of the International Federation of Accountants (IFAC). This
includes amendments resulting from IPSASs issued up to January 15,
2012.
The PAG (in italics) provides supplementary guidance on the proper
implementation of IPSAS 16.
Introduction to the IPSAS 16
IPSAS 16 prescribes the accounting treatment for investment property
and related disclosure requirements. Investment property shall be
measured initially at cost except when it is acquired through a nonexchange transaction such as donation, or when it pertains to a
property interest held under an operating lease.
After initial
recognition, the entity shall choose either fair value or cost model and
shall apply that valuation policy to all its investment property. At any
case, the fair value shall be determined either for measurement (if the
entity uses the fair value model) or disclosure (if it uses the cost
model).
Philippine Application Guidance to IPSAS 16
Scope
PAG1.Paragraph 3 deals with the applicability of this Standard to all
public sector entities other than Government Business
Enterprises (GBEs).
GBE is an entity that has all the following characteristics: (a) Is
an entity with the power to contract in its own name; (b) Has
been assigned the financial and operational authority to carry on
PPSAS Investment Property
January 2014

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a business; (c) Sells goods and services, in the normal course of

its business, to other entities at a profit or full cost recovery; (d)
Is not reliant on continuing government funding to be a going
concern (other than purchases of outputs at arms length); and
(e) Is controlled by a public sector entity.
This standard shall be applied to all National Government
Agencies (NGAs), Local Government Units (LGUs) and
Government-Owned and/or Controlled Corporations (GOCCs) not
considered as GBEs.
Measurement After Recognition
PAG2.Paragraph 39 permits the entity to choose between the fair value
model and the cost model as accounting policies applicable to its
investment property.
For consistency and uniformity, the cost model shall be adopted.
Effective Date
PAG3.This PPSAS shall apply for annual financial statements covering
periods beginning January 1, 2014.

PPSAS Investment Property

January 2014

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