This is not in compliance with the requirements of IAS - 16. In the case of an upward revaluation like this, JE should be as follows.
Dr. Equipment 50
Cr. OCI- Revaluation Surplus 50
It is required to credit to Profit & Loss only in circumstances where if revaluation loss of the same asset has recognized previously in Profit or Loss. (but Credit should be only to the extent of that amount). Otherwise revaluation surplus will be treated as OCI under equity.
Further you should continue depreciation of the asset at its new depreciable value. (Revalued Amount - Acc. depreciation & residual value)/Useful Life
In fact, the approach you describe isn't consistent with IAS 16, either. Procedure paragraph 35 gives two ways to handle the accumulated depreciation:
1.) Increase it proportionally with the increase in value; or
2.) Eliminate the accumulated depreciation to date, and restart it for the restated value (the original cost plus the change in value) over the remaining useful life.
What you can't do is book a gain; you don't have any different resources after revaluation than you had before. So changes due to revaluation go through OCI.
If you elect the first method, the entry would be:
DR Equipment 20
CR Accumulated Depreciation 6 (= (120/100 * 30) - 30)
CR Revaluation Surplus 14 (to balance)
This method puts you in the same position you would have been in if the equipment had been valued at 120 when you first acquired it (depreciation expense 12 per year).
If you elect the second method--which I think the OP is doing--the entry would be:
DR Equipment 20
DR Accumulated Depreciation 30
CR Revaluation Surplus 50 (to balance)
This method is like replacing the equipment you had before revaluation with identical equipment after revaluation and putting the gain through OCI. The revaluation surplus is greater in the second method because you're putting back the book value "consumed" by accumulated depreciation. Since the remaining useful life hasn't changed, the amount of accumulated depreciation filled in by the extra revaluation surplus will come back (faster) with the new depreciation schedule (120 over 7 years).
In both cases, the book value (Equipment less Accumulated Depreciation less Revaluation Surplus) is unchanged from before the revaluation (before revaluation 100 - 30 = first method 100 + 20 - 30 - 6 - 14 = second method 100 + 20 - 30 + 30 - 50 = book value 70).
