Entity X plans the conversion to IFRS with a reporting date of December 31, 2010, and a transition date of January 1, 2009. Entity X acquired a building a number of years ago for $90,000. According to local GAAP, the accumulated depreciation on the building as of January 1, 2009, was $30,000. However, under component depreciation (which is required under IFRS), the accumulated depreciation would have been $42,000 on January 1, 2009. How should Entity X value the building on its opening statement of financial position?

The Entity X should correct depreciation retrospectively to confirm with the requirements of IFRS.

Entity X should report the building on its opening balance sheet as if component depreciation had been utilized all along.

Entity X, alternatively may use the fair value exemption under IFRS and therefore measure the building at fair value at the date of transition with future depreciation being based on this fair value.

All of the above.