BC92 IAS 16 permits entities to choose either the cost model or the revaluation model for each class of property, plant and equipment. The Board decided that the same accounting policy options should be permitted for bearer plants. Consequently, the Board decided that the revaluation model in IAS 16 should be permitted for bearer plants.
BC93 Most respondents to the ED supported allowing entities an option to use the revaluation model. However, some respondents asked for guidance on applying the revaluation model to bearer plants. The Board decided that the requirements of the revaluation model are clear without additional guidance and it noted its expectation that the vast majority of entities with bearer plants will use the cost model for the reasons set out in paragraph BC103. Consequently, the Board confirmed that the revaluation model would be permitted for bearer plants and decided not to add additional guidance.