Assets & GRAP
GRAP 16 Investment Property
Investment property held for rentals or capital appreciation measured under GRAP 16.
Why investment property classification matters
Property a municipality holds to earn rentals or for capital appreciation, rather than for service delivery or administration, falls under GRAP 16 and must be accounted for separately from property, plant and equipment under GRAP 17. The distinction drives measurement, depreciation and disclosure, and getting it wrong distorts both the asset base and the surplus. AuditPro Core surfaces the classification decision and the supporting measurement evidence so preparers and auditors can defend each holding against the GRAP 16 definition.
The Numbers
AuditPro Core renders this view from your tenant's live, tamper-evident records. The figures below are illustrative sample data.
Portfolio value
R742 m
▲ R34 m
Fair value model
73%
Valuations overdue
4
Reclassified to PPE
R28 m
Investment property fair value movement
Major investment properties
| Property | Model | Value (R m) |
|---|---|---|
| CBD office block | Fair value | 214 |
| Retail strip lease | Fair value | 168 |
| Industrial yard | Cost | 96 |
| Land bank | Fair value | 142 |
Figures shown are illustrative sample data for demonstration. AuditPro Core renders these views from your own tenant's live, tamper-evident records.
The held-for purpose test
An asset is investment property only where it is held to earn rentals or for capital appreciation. Property used to deliver services, or held for sale in the ordinary course, is excluded and accounted for elsewhere.
Cost versus fair value model
After recognition an entity chooses the cost model or the fair value model and applies it to the whole class. Under the fair value model gains and losses flow through surplus or deficit and there is no depreciation.
Mixed-use property
Where a property is partly held for rentals and partly used for service delivery, the portions are accounted for separately only if they could be sold or leased separately. Otherwise the whole is classified by predominant use.
Transfers in and out
A change in use, evidenced by an actual event such as commencement of owner-occupation, triggers a transfer between investment property and PPE. The transfer date and trigger must be documented.
How AuditPro Core Bridges the Gap
- Classification register: every property is tagged to its held-for purpose with the GRAP 16 test recorded, making reclassifications visible and auditable.
- Measurement traceability: fair value or cost inputs link to the valuation roll or valuer report so the carrying amount traces to source.
- Exception flags: owner-occupied or service-delivery assets sitting in the investment property class are flagged for reclassification review.
- Audit-ready disclosure: the GRAP 16 note, including model elected, fair value movements and transfers, exports ready for the annual financial statements.
Key Takeaways
- Classify by purpose held: rentals or capital appreciation, not service delivery.
- Apply the chosen measurement model consistently across the whole class.
- Document the trigger and date for every transfer in or out of the class.
- Under the fair value model, route gains and losses through surplus or deficit, with no depreciation.
See This on Your Own Data
AuditPro Core renders this dashboard from your tenant's live, tamper-evident records — every figure traceable to source.