Individual Assessment on Revaluation Model and Financial Statements

Individual Assessment

Contents
INTRODUCTION......................................................................................................................3
QUESTION 1.............................................................................................................................3
Prepare an internal memo addressing Chairperson Frox’s for other relevant aspects of the
revaluation model...................................................................................................................3
QUESTION 2.............................................................................................................................4
1. Statement of Profit or Loss and Other Comprehensive Income for the year ended 30
June 2022, prepared using the function method.....................................................................4
2. Classified Statement of Financial Position as at 30 June 2022..........................................5
Include partial notes to support the balances in the statements where necessary..................7
QUESTION 3.............................................................................................................................8
Prepare an internal memo for the CEO and the board of directors........................................8
CONCLUSION..........................................................................................................................8
REFERENCES.........................................................................................................................10

INTRODUCTION
Revaluation of assets is done to make adjustments in the accounts. These amendments
change the profit and loss figures of the financial statement (D'Andreti and Bell, 2021). In the
below report, an internal memo is prepared by the financial accountant giving the aspects of
the revaluation model. Further, the financial statements are prepared by the company
Business as Usual Limited (BUL) using the trial balance and according to the AASB
standards. Moreover, the internal memo is prepared for the CEO to know about the adjusted
and non – adjusted events in the financial statements.
QUESTION 1
Prepare an internal memo addressing Chairperson Frox’s for other relevant aspects of the
revaluation model.
To,
Jamie Frox, Chairperson
From,
Financial Accountant
Date: 9- May – 2022
Subject: Considering the relevant aspect of the relevant model.
According to the revaluation model, all the non–current assets have to be revalued
at their original value on the cost which has been incurred for acquiring the asset. The
organization's non-current or fixed assets would have an advantage, assuming the
organization uses a revaluation model rather than a cost model (Barker, 2020).
Intangible assets may be conveyed as the sum of the revaluations minus any
subsequent amortization and weakness mishaps, provided that fair value is not determined
by reference to a well-functioning business unit.
The revaluation changes the depreciation measure of the asset and therefore affects
the consequent deterioration charge. After the revaluation, the asset should continue to
depreciate. Nonetheless, since the asset has been revalued, the depreciable amount has
changed.
A revaluation that increases or decreases the value of an asset can be represented by
a journal that charges or credits the asset account. The expansion of the asset value should
not be included in the compensation announcement; instead, a value account is credited
and referred to as a revaluation surplus (Bedford, Bugeja and Ma, 2022).