An entity transfers an owner-occupied property to investment property to be carried at fair value. At the transfer date, the fair value exceeds the carrying amount. How is this difference treated?

Correct answer: B) Treated as a revaluation surplus under IAS 16 in other comprehensive income.

Explanation

The entity applies the IAS 16 revaluation model up to the transfer date, so the difference is treated as a revaluation surplus in OCI.