Investeringsejendomme: Indregning og måling med fokus på den nye årsregnskabslov

Kim Røssel Petersen & Nikolaj Duus Nørgaard

Student thesis: Diploma thesis

Abstract

This thesis deals with investment properties and how to recognize them in the annual report. The government has adopted new legislation concerning investment properties, effectively for the accounting period starting the 1st of January 2016. As a matter of that we focus on Danish legislation, and will not include the international standards. The new legislation changes which companies are allowed to recognize investment properties after the fair value method. This also changes the way a holding company recognize subsidiaries with investment property and the consolidation of the annual report. At first we go through the different types of properties, as the classification determines how to recognize the property in the annual report. For investment properties the characteristics are to obtain rental income, and capital gain at sale. After identifying the investment property we will analyze how to recognize it in the annual report according to the old legislation and according to the new legislation. There are several ways to recognize the investment property, where fair value is on methode, cost is another, and revaluation over equity is a third. Further we will analyze how to recognize the shareholding in the holding company and the compilation of the consolidated report. We will discuss the differences between the old and the new legislation and how it effects the annual report. Further more to recognize an investment property in the annual report the valuation is very important. The Danish Accounting Standards provides different models to valuate an investment property. We will analyze how to valuate an investment property through the different models The Danish Accounting Standards provides. Additionally, we will discuss these models. The main models we will analyze and discuss are 1) market value, 2) discounted cash flow, and 3) normal earnings model. At last we will conclude on the differences between the old and new legislation, how to recognize a company with investment property into its holding company and the consolidating issues, and we have discussed the different types of valuation. Throughout the thesis we are going to examplify the different issues.

EducationsGraduate Diploma in Financial and Management Accounting, (Diploma Programme) Final Thesis
LanguageDanish
Publication date2016
Number of pages80