004 Enforcement of new accounting standards regarding disclosure of market value of investment property
On November 28, 2008, the Accounting Standard 20 (an accounting standard regarding disclosure of market value of investment properties) and the Accounting Standards Implementation Guide 23 (the accounting standards implementation guide regarding disclosure of market value of investment properties) were publicly announced. As a principle, these will be effective from the fiscal year ended fter March 31, 2010.
The purpose of this enforcement is to convert Japanese accounting standards to IFRS in terms of transactions of investment properties. According to this accounting standard, investment property is considered as a property held to earn rentals or capital appreciation, and you have to express the information of market value in notes of the financial statements while the amount recorded in the balance sheet is based on cost method.
Idle properties and parking lots charging by hour are within scope of investment property while hotels owned for operation are not.
The market value shown in notes is an amount based on observable market price. If the observable market price is not available, it is permitted to use the amount reasonably estimated as a note.
