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Crab Ltd in its statement of financial position at 30 June 2016 reported the existence of two reserves: an asset replacement reserve created to inform shareholders of the potential amounts of funds needed to replace critical manufacturing assets in the next few years, and an assets revaluation surplus created because of the application of the revaluation model to property held by the company.


Examine in an information release to shareholders how movements in these accounts will be accounted for and the potential effects on profit or loss and other comprehensive income.

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