- CFA Exams
- 2021 Level I
- Study Session 8. Financial Reporting and Analysis (3)
- Reading 26. Long-lived Assets
- Subject 8. Investment Property
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Subject 8. Investment Property PDF Download
Investment property is defined as property that is owned (or, in some cases, leased under a finance lease) for the purpose of earning rental income, capital appreciation, or both.
Under IFRS, companies are allowed to value investment properties using either a cost model or a fair value model.
- The cost model is identical to the cost model used for property, plant, and equipment (PP&E).
- The fair value model differs from the revaluation model used for PP&E. All changes in the fair value of investment property affect income.
Under U.S. GAAP, there is no specific definition of investment property. Investment properties are generally measured using the cost model.
Learning Outcome Statementsn. compare the financial reporting of investment property with that of property, plant, and equipment;
CFA® 2021 Level I Curriculum, 2021, Volume 3, Reading 26
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