How to calculate the property and land of overseas subsidiaries?

Article 2 of the Interpretation of Accounting Standards for Business EnterprisesNo. 1 stipulates: "If the transactions or events of overseas subsidiaries of domestic enterprises do not exist in China and are restricted by laws and regulations, or the transactions are unusual and the accounting standards for business enterprises are not standardized, the accounting treatment results of overseas subsidiaries can be adjusted according to the principles of Accounting Standards for Business Enterprises-Basic Standards and merged into the domestic parent company. In this case, when an enterprise purchases a piece of land with ownership and houses and buildings on it overseas, it should refer to the following provisions in paragraph 58 of International Accounting StandardsNo. 12. 16- Real Estate, Plant and Equipment under the International Financial Reporting Standards System (IAS 16): Land and buildings are independent assets and should be accounted for separately, even if they are purchased together. Land usually has no useful life, so it is not depreciated. Buildings have a limited service life, so they are depreciable assets. The increase of land value does not affect the determination of the service life of affiliated buildings.

The Interpretation of Accounting Standards for Business Enterprises (20 10) has a similar provision on page 104, that is, "If the houses and buildings purchased by an enterprise include the value of land and buildings, the paid price shall be distributed between the land and the above-ground buildings according to reasonable methods (such as fair value); If it is really impossible to reasonably allocate the above-ground buildings and land use rights, all of them should be accounted for as fixed assets. " Therefore, as far as possible, Company A should determine the respective fair values of land and house in the total purchase price. For example, the fair value of land can be determined by referring to the recent transaction price of "bare land" under similar circumstances around, and the fair value of land can be confirmed as "fixed assets-land", and subsequent depreciation or amortization is not allowed; The remaining purchase price is included in "fixed assets-buildings", and depreciation is accrued within the expected remaining service life of buildings. If it is really impossible to allocate the purchase price reasonably between land and buildings, the total price shall be included in "fixed assets-buildings" and depreciation shall be accrued according to the expected remaining service life of buildings. However, when determining the estimated net salvage value, due consideration should be given to the possible impact of the land value when the service life of the building expires.