IAS 40, Investment Property, is an international accounting standard. This standard differs substantially from current Swedish accounting rules. According to the fair value model in IAS 40, investment properties should be continually reported at their fair value, and changes in value represent a component of profit for the year. Certain problems arise in conjunction with this type of accounting, including the feasible accuracy of valuations and cyclical movements in values over time. Given the fact that listed companies in the EU are to apply IAS no later than 2005, the application of the fair value model in IAS 40 accounting rules may arise for Swedish companies. The purpose of the paper is primarily a descriptive one. It is designed to highlight relevant theory in respect of accounting and valuation for property as well as conceivable accounting effects for property arising from uncertainty in valuations and the impact of cyclical movements in values. The conclusions of the paper are that fair value accounting for investment property will result in a reduction in the significance of previous key accounting principles Ò realization and prudence concepts Ò in favor of a nominally correct wealth measurement in financial statements. Cyclical movements in values over time may have considerable implications for reported earnings and reported equity. Furthermore, the uncertainty of property valuations is probably of such a magnitude that the consistency of both the income statement and balance sheet may be questioned to a certain extent as a result of the application of the fair value model.