Agenda
           Introduction
           Introduction
           Literature Review
           Literature Review
           Research Method
           Research Method
           Discussion and Analysis
           Discussion and Analysis
           Conclusion
           Conclusion
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      Introduction
                                                Revaluation model and fair value 
            Revaluation of assets is a              would increase financial 
         reassessment of the value of the       statement relevance because the 
         assets owned by the company.            assets reflect the fair value or 
                                                          actual value. 
            Treatment of revaluation of              Revaluation model is a 
         assets in Indonesia can be done        accounting policy for fixed asset 
            either in accounting or tax.             and fair value model is 
           Revaluation or reappraisal is          accounting policy for property 
        usually performed on fixed assets                  investment.
             or investment properties.
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   Introduction
                 TAX
   • The revaluation are also regulated in the Income Tax Act Article 4 
    paragraph (1) letter m stating that “the excess of the revaluation of 
    a fixed assets is the object of income tax”. 
   • Tax only recognizes the excess over the revaluation of fixed 
    assets. In other words, only the excess (gain) on revaluation of 
    fixed assets are taxed but impairment not tax deductible. 
   • Further rules regarding the revaluation of fixed assets in the tax 
    regulated in PMK 79/PMK.08/2008:
    • Increasing of asset tax by 10% final and additional tax (tax 
     statutory tax-10%) if company sale the asset
    • Revaluation only allow every 5 year
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   Introduction
    • PSAK 16 in 1994, revaluation is not allowed for assessment 
     under the acquisition price, but a deviation from this provision 
     may be carried out under the provisions of the Government.
    • PSAK 16 (2007), Revaluation is an accounting policy choices 
     that must implement consistently.
    • Changes in accounting standards have led to differences 
     between the tax and accounting treatment of fixed assets  
     caused the decreasing incentive for tax revaluation
    • To encourage domestic economy and provide incentives to 
     companies, the government issued a new policy that PMK 
     191/PMK.010/2015 and was revised in PMK 233 / PMK.03 / 
     2015.
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   Introduction
  • Piera (2007) found that the company in the Swiss tend to revalue fixed 
   assets because of the leverage and international stakeholders.
  • Su Seng (2010) found the intensity of the assets, as the factors that 
   drive the company revalued the assets.
  • The earlier study in Indonesia only conduct an analysis of the 
   implications of the corporate income tax on revaluation.
  • This research focuses on:
    – How impact the new tax regulation on revaluation to the companies 
     decision on revaluation
     • Company characteristic
     • Type of asset
    – What factors that impact of revaluation decision (size, capital 
     intensity)
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