Revaluation of Non-Current Assets (IAS 16):

• When revaluing non-current assets, IAS 16 permits entities to revalue their assets to reflect their fair market value. Revaluation should be done regularly to ensure the carrying amount does not differ materially from fair value at the end of the reporting period.
• Once an asset is revalued, the entire class of assets to which the asset belongs must also be revalued.

Revaluation Surplus:

• If the revalued amount exceeds the carrying amount of the asset, the surplus is credited to the revaluation surplus account, which is part of equity.
• This surplus is not recognized in profit or loss unless it reverses a previous revaluation decrease recognized as an expense.

Revaluation Deficit:

• When the carrying amount of the asset exceeds its revalued amount, the deficit is charged as an expense in the profit or loss account.
• However, if there is a prior credit balance in the revaluation surplus, the deficit is offset against that balance before being expensed.

Gains on Disposal of Assets:

• When an asset is sold or disposed of, the gain is the difference between the net sale proceeds and the carrying amount of the asset.
• This gain is recognized as income in the statement of profit or loss.

Losses on Disposal of Assets:

• If the carrying amount exceeds the proceeds from the sale, the resulting loss is charged as an expense in the statement of profit or loss.