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Recommendations for valuing real estate under IFRS

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31 Jan 2004

The European Public Real Estate Association (EPRA) has published its (PDF 565k) regarding the valuation of real estate under International Financial Reporting Standards.

The EPRA recommendations are supported by the (PDF 138k). EPRA's recommendations state:

1. General items: EPRA is neither an accounting body nor a valuation body. As from 2005, EPRA members will have to report in accordance with International Financial Reporting Standards (IFRS). The Best Practices Recommendations provide a framework for:

  • Specific additional guidance for real estate companies within the IFRS framework;
  • Uniform performance reporting and presentation between real estate companies;
  • Additional disclosure guidance.
2. Accounting and valuation principles: for all areas where IFRS is not specific enough for real estate companies, the Best Practices Recommendations provide tailored guidance, aiming for uniform accounting and valuation principles amongst our members. 3. Presentation of accounts: as IFRS, to some extent, is "format free" regarding the presentation of the balance sheet, profit & loss accounts and cash flow statements, the Best Practices Recommendations propose standard formats for the presentation of these accounts. 4. Notes and additional disclosure: making the performance of real estate companies insightful requires additional notes and disclosure items, based upon uniform recommended standards. 5. Draft recommendations: at current, several areas for which EPRA wishes to issue recommendations, need further research and consulting of EPRA members as well as of the IASB before final recommendations can be issued.

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