Revaluation (Finance)

Revaluation in finance refers to adjusting the recorded value of an asset, typically a fixed asset like property or equipment, to reflect its current market value rather than its original purchase cost. This process ensures that the asset's value on the company's balance sheet is accurate and up-to-date. Revaluation can lead to increased or decreased asset values, impacting the company's financial statements, depreciation calculations, and overall financial position. It is often done periodically to provide a realistic view of an asset's worth, especially when market conditions have significantly changed since the asset was acquired.