First Use of the Revaluation Model: Two Rules in Egyptian Standards
How is a first move to the revaluation model accounted for? Decree 883 of 2023 gives two rules: a revaluation under EAS 10 or 23, or retrospective application under EAS 5.
By Accounting & Bookkeeping Department · 21 October 2026 · 7 min read
Executive summary
- Prime Minister's Decree No. 883 of 2023 made the revaluation model available for fixed assets (EAS 10) and intangible assets (EAS 23) for financial periods beginning on or after 1 January 2023.
- The same decree added paragraph 17 to EAS 5: the initial application of a revaluation policy "is dealt with as a revaluation" under EAS 10 or 23, and paragraph 18 disapplies paragraphs 19 to 31 to it.
- Paragraph 80A of EAS 10 and paragraph 130 of EAS 23, issued by the same decree, require retrospective application under EAS 5, with the cumulative effect added to the revaluation surplus at the beginning of the period of first application.
- Decree No. 3287 of 2023 did not deal with the first application of the revaluation model under EAS 10 or 23, and no later decree up to No. 3527 of 2024 amends these paragraphs.
- In our view, the text does not settle which rule prevails; the safer course is to choose one treatment, disclose the other and agree it with the auditor before the first financial statements.
The decree and its dates
Prime Minister's Decree No. 883 of 2023 "amending certain provisions of the Egyptian Accounting Standards" was published in the Official Gazette, Issue 9 (bis), on 6 March 2023, and applies "from the day following its publication" (Article 5), that is from 7 March 2023. Its Article 1 replaced the preface to the standards, and its Article 2 replaced Standards (10) and (23) together with three others. Both standards apply the revaluation option "to financial periods beginning on or after 1 January 2023" (paragraph 80 and paragraph 129 respectively). The preface states that it "must be regarded as an integral part" of the standards and that the Egyptian Accounting Standards "must not be used independently of this appendix". The choice between the two models and the conditions for revaluing are covered in Fixed assets in Egypt: recognition, capitalisation and depreciation.
The first rule: EAS 5 paragraphs 17 and 18
In the 2015 text of EAS 5 "Accounting Policies, Changes in Accounting Estimates and Errors", paragraph 17 read "repealed", while paragraph 18 remained: "Paragraphs 19 to 31 do not apply to the change in accounting policy described in paragraph 17" (Al-Waqa'i al-Misriyya, Issue 158 (continued) (a), 9 July 2015, p. 157). The 2023 preface then added paragraph 17 (Official Gazette, Issue 9 bis, p. 247; our translation):
"The initial application of a policy to revalue assets in accordance with Egyptian Accounting Standard No. (10) ... or Egyptian Accounting Standard No. (23) ... is a change in accounting policy that is dealt with as a revaluation in accordance with Egyptian Accounting Standard No. (10) ... or Egyptian Accounting Standard No. (23) ..., and not in accordance with this Standard."
EAS 5 is not among the standards replaced or amended by Articles 2 and 3 of Decree No. 69 of 2019, and Decree No. 883 touched only its paragraph 17, so paragraph 18 now refers to a live text. The paragraphs it disapplies include paragraph 22, which on retrospective application requires the entity to "adjust the opening balance" of the affected components of equity "for the earliest prior period presented" and the other comparative amounts, and paragraphs 28 and 29 on disclosing a change in accounting policy.
The second rule: EAS 10 paragraph 80A and EAS 23 paragraph 130
Both paragraphs sit under the heading "Effective date and transitional provisions". Paragraph 80A provides that "the entity must apply the amendments in paragraph 80 retrospectively" in accordance with EAS 5, "recognising the cumulative effect of initially applying the revaluation model by adding it to the revaluation surplus account within equity at the beginning of the financial period in which the entity first applies this model" (our translation). Paragraph 130 of EAS 23 is in the same words and refers to paragraph 129. Neither paragraph is limited to 2023; both tie the rule to the period in which the model is first applied.
What each treatment does to the figures
| EAS 5 paragraphs 17 and 18 | EAS 10 paragraph 80A and EAS 23 paragraph 130 | |
|---|---|---|
| Nature | A revaluation under EAS 10 or 23 | A change applied retrospectively under EAS 5 |
| Where the increase goes | Other comprehensive income, accumulated in equity as "revaluation surplus" (EAS 10 paragraph 39, EAS 23 paragraph 85) | The cumulative effect is added to the revaluation surplus at the beginning of the period of first application |
| Opening balances and comparatives | EAS 5 paragraph 22 does not apply | Paragraph 22 applies through the reference to EAS 5 |
| EAS 5 disclosure of the change | Paragraphs 28 and 29 do not apply | Paragraph 28 or 29, depending on the nature of the change, applies through the reference to EAS 5 |
| Revaluation disclosures | EAS 10 paragraph 77, EAS 23 paragraph 124 | The same |
What the second column says about comparatives and disclosure follows from the paragraphs' reference to EAS 5, not from their own wording.
Decree No. 3287 of 2023 and later decrees
Article 2 of Prime Minister's Decree No. 3287 of 2023 (Official Gazette, Issue 34 bis (d), 29 August 2023) added to item seven of the preface a paragraph stating that the fixed assets and intangible assets standards were issued "and the use of either the cost model option or the revaluation model option was permitted for the subsequent measurement of these assets". It confirms the option, does not deal with first application, and does not amend EAS 5 paragraphs 17 and 18 or paragraphs 80A and 130. Investment property is not named in paragraph 17 and has its own rule in paragraph 81 of EAS 34 as issued by Decree No. 636 of 2024: retrospective application with the cumulative effect added "to the balance of retained earnings".
We read the operative articles of the decrees amending the standards after Decree No. 883 up to Decree No. 3527 of 2024 (Nos. 1847, 3287 and 4575 of 2023, and 636, 1711 and 3527 of 2024) and found nothing that amends EAS 5, paragraph 80A or paragraph 130. Neither the Financial Regulatory Authority's decree listing nor the legislation portal of the Ministry of Investment and Foreign Trade shows a later decree amending the Egyptian Accounting Standards as of 22 October 2026 (see Egyptian Accounting Standards: recent amendments and effective dates, and Egyptian Accounting Standards vs IFRS: what still changes the figures).
Two readings, and our view
The first reading gives priority to paragraphs 17 and 18, because they address the initial application of a revaluation policy specifically, and because the preface requires that the standards are not used independently of it; on this reading the revaluation is recognised in the period of application without restating comparatives. The second reading gives priority to paragraphs 80A and 130, because they are the transitional provisions of the standards that introduced the option; on this reading the change is applied retrospectively. Both rules were issued by one decree on one day, so the date of issue does not favour either.
In our view, the published text does not settle which reading prevails. The practical course is to choose one treatment, state it in the accounting policies note with the paragraph relied on, disclose the other, and agree it with the auditor before the first financial statements. An entity taking the second reading in statements that present a comparative year needs a documented decision reconciling retrospective application with recognising the effect "at the beginning of the financial period" in which the model is first applied. The choice does not replace the conditions for revaluation themselves, including a valuer registered with the Financial Regulatory Authority for land and buildings.
What this requires
- Identify the class moving to the revaluation model and the financial period of first application.
- Prepare the figures under both treatments: the opening revaluation surplus, other comprehensive income for the period, and the comparatives.
- Choose one treatment and describe it in the accounting policies note with its basis.
- Disclose the other treatment, and the items in EAS 10 paragraph 77 or EAS 23 paragraph 124.
- Present the choice to the auditor and document the agreement before the close.
- Track any decree amending the standards that removes this conflict.
The firm's Accounting & Bookkeeping Department prepares the entries for a first application of the revaluation model and the accounting policy note that goes with it, and checks the chosen treatment against the Egyptian Accounting Standards before it goes to the auditor.
Nehal Saied, Partner
Chartered Accountant, Ministry of Finance, Egypt
Member, Egyptian Tax Society
Member, Egyptian Society for Public Finance and Taxation
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