ratio"). Methods of revaluation of fixed assets The common methods used in revaluing assets are: Indexation Under this method, indices are applied to the cost value of the assets, to arrive at the current cost of the assets. The Indices by the country's departments of Statistical Bureau or Economic Surveys may be used for the revaluation of assets. Current Market Price (CMP) Land values can be estimated by using recent prices for similar plots of land sold in the area. However, certain adjustments will have to be made for the plus and minus points of the land possessed by the company. This may be done with the assistance of brokers and agencies dealing in land, or by a licensed appraiser. Buildings values can be estimated by a real estate agent (or broker or dealer) or Chartered Surveyor (in the UK) in a similar manner to land. Plant and Machinery: The CMP can be obtained from suppliers of the assets concerned. This may not be possible if brands are unavailable in the market due to the closure of companies manufacturing them. Similarly, a direct CMP may not be available for a model that has been discontinued or changed by the manufacturer. Comparison of assets to most similar types available for sale, new or used, can provide an estimate of value. CMP of an existing asset = CMP of comparable new asset × remaining useful life of asset ÷ original useful life of asset. Appraisal method Under this method, technical experts are called in to carry out a detailed examination of the assets with a view to determining their fair market value. A proper appraisal is necessary when the company is taking out an insurance policy for the protection of its fixed assets. It ensures that the fixed assets are neither over-insured nor under-insured. The factors which are considered in determining the value of an asset, are as follows: Date of purchase. Extent of use i.e. single shift, double shift, triple shift. Type of asset. Whether the asset is a general purpose or special purpose asset? Repairs and Maintenance policy of the enterprise. Availability of spares in the future, mainly in the case of imported machines. Future demand for the product manufactured by an asset. If the asset is part of a bigger fixed asset, the life of the latter is crucial. Selective revaluation Selective revaluation can be defined as the revaluation