Crucial to the Revaluation of Tangible Assets is the performance of those assets and the choices of as regards why is the revaluation necessary and what is the most suitable method and whether the values arrived at by one method should be crosschecked with the values derived from another method.
Performance of Tangible Assets
Maintenance must be viewed in the overall context of the ability of the tangible assets to support service delivery in terms of physical condition, functionality, capacity, environmental performance and alignment with service demand.
Reasons for Revaluation
There is an important distinction to be made whether the revaluation is meant for a private or public institution. The purposes are varied.
Preliminary Considerations
Revaluation will typically require liaison between the company’s Production Department, Accounts Department, Technical Department and external appraisers. To commission the project, they should set out the objectives of what they wish to achieve and how it should be done.
Methods of Revaluation of Tangible Assets
The depreciation method used should reflect the pattern in which the asset’s economic benefits are consumed by the entity. There are say that depreciation method should be reviewed on a regular basis and, if the pattern of consumption of benefits has changed, the depreciation method should be changed prospectively.
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