tailieunhanh - Lecture Framework of financial reporting - Lecture 14

The main contents of the chapter consist of the following: Impairment of assets – IAS 36, recognition and measurement of an impairment, impairment of assets, recoverable amount, cash generating units (CGUs). | Revise lecture 14 Impairment of assets – IAS 36 Impairment of assets – IAS 36 Objective of IAS 36 Definition of impairment Measurement of recoverable amount Indication of impairment Annual impairment reviews Impairment of assets – IAS 36 Excluded assets IAS 36 applies to all assets other than: Inventories Construction contracts Deferred tax assets Assets arising from employee benefits Financial assets IAS 32 Investment property measured at fair value Non-current assets classified as held for sale Impairment of assets – IAS 36 What is impairment? An asset is impaired if its recoverable amount is below the value currently shown on the statement of financial position, the asset’s current carrying value (CV) Recognition and measurement of an impairment Impairment of assets Recognition and measurement of an impairment Where there is an indication of impairment, an impairment review should be carried out: The recoverable amount should be calculated The asset should be written down to recoverable amount The impairment loss should be immediately recognised in the income statement Impairment of assets The only exception to this is if the impairment reverses a previous gain taken to the revaluation reserve. In this case, the impairment will be taken first to the revaluation reserve until the revaluation gain is reversed and then to the income statement. Question 1 – recoverable amount A company owns a car that was involved in an accident at the year end. It is barely useable, so the value in use is estimated at Rs1000. However, the car is a classic and there is a demand for the parts. This results in a fair value less costs to sell of Rs3000. The opening carrying value was Rs8000 and the car was estimated to have a life of 8 years from the start of the year. sult 9 Required: Identify the recoverable amount of the car and any impairment required Answer 1 Question 2 An entity owns a property which was originally purchased for Rs300,000. The property has been revalued to . | Revise lecture 14 Impairment of assets – IAS 36 Impairment of assets – IAS 36 Objective of IAS 36 Definition of impairment Measurement of recoverable amount Indication of impairment Annual impairment reviews Impairment of assets – IAS 36 Excluded assets IAS 36 applies to all assets other than: Inventories Construction contracts Deferred tax assets Assets arising from employee benefits Financial assets IAS 32 Investment property measured at fair value Non-current assets classified as held for sale Impairment of assets – IAS 36 What is impairment? An asset is impaired if its recoverable amount is below the value currently shown on the statement of financial position, the asset’s current carrying value (CV) Recognition and measurement of an impairment Impairment of assets Recognition and measurement of an impairment Where there is an indication of impairment, an impairment review should be carried out: The recoverable amount should be calculated The asset should be written down to .

• Tài chính doanh nghiệp
• Financial Reporting
• Framework of financial reporting
• Lecture Framework of financial reporting
• Regulatory system
• Financial statements
• Cash generating units