Bulletinen nummer 3 2016 BAS-kontogruppen Fastigheter BAS 2016

I’m continuously commenting news related to my book on real estates (Fastigheter) here on the blog. Today’s update is about a recently published article Fastigheter, on accounting issues for real estates.

The content might be internationally relevant since the Swedish accounting regulations are adapting the EU accounting directives, which in turn is collaborating with international standards.

Accounting Issues for Real Estates


The accounting magazine Bulletinen is published by BAS-kontogruppen i Stockholm AB, The BAS Organisation, whose main task is to produce and maintain a Swedish standard chart of accounts (also available in English as The Accounting Manual). I’ve published a number of posts about BAS here on the blog, the latest is from September 28, Meeting BAS & Srf.

Bulletinen published my article on accounting issues for real estates this week, in edition 3, 2016. This article covers six areas that attracted interest while I was writing the book Real Estates and the focus here is on the BAS chart of accounts, hereafter called BAS 2016.

Here is an offprint of the article, published with permission from Bulletinen and Wolters Kluwer.

1. Asset accounts

In my book I cover real estates owned or used in different ways, with different accounting and taxation.

  • Fixed assets
    • Intangible assets
      • Tenancy and site leasehold rights
    • Tangible assets
      • Land and buildings
    • Financial assets
      • Participation in tenant-owner associations
  • Current assets
    • Inventories etc.
      • Real property portfolio, directly owned
      • Real property portfolio, indirectly owned by participation in group companies

In BAS 2016 I find accounts for every ownership and usage above but one, Real property portfolio by participation in group companies, so in the article I suggest the addition of such an account.

2. Site leaseholds

BAS 2016 includes an account for tenancy and site site leasehold rights.

In the article I argue that there’s no need for an account for site leasehold rights. My arguments are that the the buyer of a building with site leasehold right is supposed to include the value of the right in the purchase value of the building, and the owner of the land is supposed to account for it as land regardless it’s leased as a site leasehold right or not, so neither the provider or the lessee needs a separate account for the site leasehold right.

3. Down payments

The accounts for the different types of ownership and usage of real estate, which I describe in 1. Asset accounts above, needs clarifications in BAS 2016 regarding the accounting of received or paid down payments. I the article I suggest such clarifications.

4. Selling costs

In my practice I’ve got frequent questions about how to account for selling costs, such as broker’s fee or courtage. I therefor suggest clarifications in BAS 2016, describing how selling costs should reduce the income from the sale and not be accounted for separately.

5. Write-downs

BAS 2016 includes accounts for write-downs for some some assets, but not for all types of assets that are relevant. Therefor I suggest completions of BAS 2016 where the write-down accounts are missing, to provide the possibility of consequent gross accounting.

I also argue in the article for gross accounting as a recommended method, to facilitate a correct two-step calculation of sales result: reversal of write-down in step one and calculation of the sales result in step two.

6. Connection fees

During 2016 we received a stance on accounting of connection fees from the government body The Swedish Accounting Standards Board (Bokföringsnämnden, BFN, latest mentioned in my post from October 8 Meeting BFN in Stockholm).

Among other topics BFN stated that the fee for connecting a real estate to the municipal water and sewer system shall be accounted for as a separate intangible fixed asset, while costs for installing between the municipal connection point and the real estate shall be accounted for together with the tangible asset of land and building. In the article I suggest clarifications in BAS 2016 on these differences.

Comments on the article

In a separate article the board of the BAS organisation comments my suggestions, one by one, and whether they will follow them or not. Accepted suggestions will be introduced in the next edition, BAS 2017, as the BAS chart of account is maintained yearly.


Read the details and other interesting articles – subscribe on Bulletinen (in Swedish)!

Book Real Estates Bok Fastigheter En praktisk vägledning om redovisning och beskattning Peter Berg

How to buy the book

All topics in my article have been raised while writing the book Real Estates which, however, is in Swedish.

Links to my publisher and some internet shops can be found in the post Fastigheter.

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