Problem
Golden Ltd (Golden) is a diversified Australian listed company whose top twenty shareholders include many large industry superannuation funds. Golden's shares are actively traded on the Australian Securities Exchange. Golden uses a 30 June year-end balance date and adopts the AASB Conceptual Framework 2019 (the Framework), AASB 13: Fair Value Measurement (AASB 13), AASB 116: Property, Plant and Equipment (AASB 116) and AASB 136: Impairment of Assets (AASB 136).
On 1 July 2022 Golden expanded their operations into the Australian retail sector by making a long-term capital investment in the Australian retail sector. This investment supports Golden's 2025 Strategic Business Expansion Plan. Throughout the year ended 30 June 2023 Golden acquired several retail shopping centre buildings in Australian capital cities. The buildings will be a new class of assets in Golden's financial statements. Research data shows Golden's competitors have adopted the AASB 116 revaluation model for similar retail shopping centre building classes of assets. The purchase of the buildings has been financed with secured mortgages over the buildings that have been provided by institutional lenders.
Due to a recent increase in lending interest rates, Golden's largest shareholders and a number of their institutional lenders have expressed their concern to Golden's Finance Director about declining commercial real estate property values and the related impact on Golden's financial statements for the year ended 30 June 2023 and later accounting periods. You are an experienced member of Golden's Corporate Reporting Team. The Finance Director has reached out to your team asking for assistance with the following questions
• Identify and describe one key financial reporting measurement issue that could arise under AASB 136.