Harta Bhd leases its luxurious condominiums to some celebrities at below market price. It is as an incentive to the contract of employment between Butik Husna with the celebrities. They are the models of various apparel and accessories. Harta Bhd is considering to treat these condominiums as investment properties. The difference between the market and actual rental will be written off in the statement of profit or loss as employee Melorefit expenses.

(4 marks) (CLO1:PLO1:C3) Harta Bhd acquired a piece of land for RM200 million on 1 January 2015. The land was classified as investment property and measured at cost. On 1 January 2019, Harta Bhd changed to fair value measurement for the land. It was able to derive the fair values of the land effective on 31 December 2018 which was RM290 million. The fair value of the land on 31st December 2019 was RM313 million. There was no tax suffered on fair value changes or on sale of the land. (9 marks) (CLO1:PLO1:C4) Harta Bhd Bhd had used an office building for administrative purposes with a depreciated cost of historical cost of RM3.6 million on 1 April 2019 with a remaining life of 20 years. There were some reorganizations to Hartas properties during the year of 2019. The office building was rented to a third party and reclassified as an investment property applying the fair value on 1 October 2019. Harta Bhd had consulted an independent professional assessor valued on the property. The fair value of the building was valued at RM4.14 million at 1 October 2019 by the assessor. This value rose further to RM4.212 million at 31 March 2020.

(12 marks) (CLO1:PLO1:C6) Required: Discuss the accounting treatment of the above scenarios in accordance to the relevant MFRS. Show the effects to the financial statements of Kaya Bhd.