This article examines the transition of Property, Plant and Equipment from previous GAAP to Ind AS through practical case studies. It explains how Ind AS 101 permits deemed cost relief while requiring entities to apply Ind AS recognition, classification and presentation principles.
‣ Capital Spares - Specialised spares used for more than one period may need reclassification from inventory to PPE
‣ Revaluation Reserve - Existing reserves may be transferred to retained earnings when the cost model is adopted
‣ Deferred Tax - Related deferred tax liabilities may continue where taxable temporary differences remain
‣ Impairment Losses - Prior impairment losses cannot be reversed merely because deemed cost is adopted
‣ Assets Held for Sale - Assets not meeting Ind AS 105 criteria may need reclassification as PPE
The article highlights that deemed cost relief simplifies transition but does not override core Ind AS requirements
