CS 8.1 Impairment of assets Source: IFRS - IAS 36 Illustrative Examples Impairment of Assets – Illustrative examples Example 1 Identification of cash-generating units A - Retail store chain Background Store X belongs to retail store chain M. X makes all its retail purchases through M’s purchasing centre. Preparing cash flow projections that exclude such items would often necessitat… If the impairment test is performed at a level such that the CGU is too small, it is likely that the entity will recognise excessive impairment charges. 3. The International Accounting Standards Board, as a consequential amendment to IFRS 13 'Fair Value Measurement', modified some of the disclosure requirements in IAS 36 'Impairment of Assets' regarding measurement of the recoverable amount of impaired assets. Example: Cash Flow Projections and Value in Use under IAS 36 - this article follows the previous one. IFRS 13 Fair Value Measurement amended all references to “fair value less costs to sell” in these examples with effect from 1 January 2013. BCZ105-BCZ107), Revalued assets: recognition in the income statement versus directly in equity (paras. Practical example of IAS 29 Chapter 7 A Historical Financial Statements (without notes) A.I Historical Balance Sheets as at 31 December 2003 and 2002 34 A.II Historical Income Statement for the year ended 31 December 2003 35 A.III Historical Statement of Cash Flows for the year ended 31 December 2003 36 –37 58-64), Cash-generating units and goodwill (paras. CS 8.1 Impairment of assets Source: IFRS - IAS 36 Illustrative Examples Impairment of Assets – Illustrative examples Example 1 Identification of cash-generating units A - Retail store chain Background Store X belongs to retail store chain M. X makes all its retail purchases through M’s purchasing centre. • the interaction between IAS 36 and other IFRSs. IU 05-16]. In addition, IFRS and its interpretation change over time. Each example illustrates a selection of requirements from ... For example, IAS 2, paragraph 36. Measurement (paras. BCZ23-BCZ27), Other refinements to the measurement of recoverable amount (paras. BetterRegulation.com © 2020 All rights reserved. One of the specified indicators of impairment in NZ IAS 36, paragraph 12 (e), is ‘evidence is available of obsolescence or physical damage of an asset’. IAS 36 — Impairment of Assets ... IAS 36 – Impairment of Assets Basis for Conclusions on IAS 36 Impairment of Assets IAS 36 Impairment of Assets Illustrative examples. IAS 41 then deals with gains and losses, inability to measure fair value reliably, provides rules for government grants related to biological assets. Previous Section Next Section . IAS 36 — Impairment of Assets ... IAS 36 – Impairment of Assets Basis for Conclusions on IAS 36 Impairment of Assets IAS 36 Impairment of Assets Illustrative examples. Previous Section Next Section . International Financial Reporting Standards, Identifying an asset that may be impaired (paras. BC171-BC177), Allocating an impairment loss between the assets of a cash‑generating unit (paragraphs 104-107) (paras. Examples include financial assets such as receivables. Illustrative IFRS consolidated financial statements - Investment property 2020. BC160-BC170), Changes as a result of 2008 revisions to IFRS 3 (Appendix C) (para. Previous Section Next Section . IAS 36 — Impairment of Assets. BC223-BC226), Early application (paragraph 140) (paras. 3 | IAS 36 Impairment of Assets IASB APPLICATION DATE (NON-JURISDICTION SPECIFIC) IAS 36 is applicable for annual reporting periods commencing on or after 1 January 2005. Practical tip: disposals When an asset is to be disposed of, its cash inflows will be independent of the cash inflows of other assets. IAS 36: Illustrative Examples; Document overview . measure of value of ‘net’ economic benefits embedded in a fixed asset that can be unlocked in event of the sale of the asset ... Financial liabilities and equity (IFRS 9, IAS 32) Chapters by name (Accounting to Fair value) Accounting policies, accounting estimates and errors (IAS 8) Consolidated financial statements (IFRS 10) The implementation guidance to IAS 1 contains illustrative examples of acceptable formats. IAS 36 Impairment of Assets – Summary – Examples – PDF October 1, 2019 IFRS 16 Leases – Summary with examples – PDF October 1, 2019 IFRS 15 Revenue from contracts with customers April 29, 2020 ... Reasons for revising IAS 36 IN2 The International Accounting Standards Board developed this revised IAS 36 as part of its project on business combinations. 53-58) Changes in provisions (paras. It provides detailed guidance along with illustrative examples. Accordingly, this guide should not be used as a substitute for referring to the standards and other relevant interpretative guidance. BCZ98-BCZ104), Recognition based on an ‘economic’ criterion (paras. 'Set the date' will change the date at which you are viewing the document. BC56-BC80), Consideration of future tax cash flows (paras. Editorial Note. IAS 36 — Impairment of Assets ... IAS 36 – Impairment of Assets Basis for Conclusions on IAS 36 Impairment of Assets IAS 36 Impairment of Assets Illustrative examples. regional basis. Therefore, the asset should be assessed for impairment in its own right, rather than as part of a CGU. Viewpoint - Global. You can find the video in the bonus section. The amended standard and new standard are effective for periods beginning on or after 1 January 2017 and 1 January 2018, respectively. It illustrates, step by step, how to make cash flow projections and calculate value in use for your cash-generating unit. If you navigate away from this document, the view date will reset. A limited amendment was made in 2000. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. BC216-BC222), Transitional impairment test for indefinite‑lived intangibles (paras. See also illustrative examples 5 and 6 to IAS 36. BCZ46-BCZ51), Discount rate (paragraphs 55-57 and A15-A21) (paras. Section F: Disclosures This Section provides a summary of the IAS 36 disclosure requirements and highlights particular areas of focus for regulators, including select illustrative examples for these areas of focus. In addition, IFRS and its interpretation change over time. Examples of Non-Adjusting Events include: Declaration of dividends after the reporting date does not indicate existence of liability to pay dividends at the reporting date and shall not therefore trigger the recognition of liability in financial statements in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets. History of amendments; Document overview; Tools; Set document view date. IAS 36 — Impairment of Assets. Appendix A. Under IAS 36, ‘Impairment of assets’, these assets are required to be tested annually for impairment irrespective of indictors of impairment (IAS 36 para 10). The disclosures are primarily concerned with the assumptions and estimates used in determining VIU or FVLCD, whichever supports the recoverable amount. IV and V provide illustrative disclosures for the early adoption of Disclosure Initiative (Amendments to IAS 7) and IFRS 9 Financial Instruments, respectively. In cases where the lessee concludes that the buyer would not BC131-BC177), Allocating goodwill to cash‑generating units (paragraphs 80-87) (paras. IAS 36 Impairment of Assets 2017 - 07 2 An assets value in use is the present value of the future cash flows expected to be derived from an asset or cash generating unit. 7-17), Measuring recoverable amount (paras. It is worth considering Illustrative Example, IE1, in NZ IAS 36. BCZ40-BC80), Expected value approach (paras. Using present value techniques to measure value in use. 59-60) Use of provisions (paras. Set a date to view the document . You are here ... International Accounting Standards . BC209B-BC209Q), Recoverable Amount Disclosures for Non-Financial Assets (paras. International Accounting Standards . BC137-BC159), Recognition and measurement of impairment losses (paragraphs 88-99 and 104) (paras. ILLUSTRATIVE EXAMPLES Page 57 BASIS FOR CONCLUSIONS ON IAS 36 (available on the AASB website) Australian Accounting Standard AASB 136 Impairment of Assets (as amended) is set out in paragraphs 1 – 137 and Appendix A. BCZ85), Interaction with IAS 12 (paras. You can find the video in the bonus section. You are here ... International Accounting Standards . The private railway could be sold only for scrap value and it does not generate cash inflows that are largely independent of the cash inflows from the other assets of the mine. BCZ182-BCZ186), Reversing goodwill impairment losses (paragraph 124) (paras. BC90-BC94), Recognition of an impairment loss (paragraphs 58-64) (paras. This appendix is an integral part of the Standard. See also illustrative examples 5 and 6 to IAS 36. International Accounting Standards. BCZ178-BCZ181), Reversing impairment losses for assets other than goodwill (paragraphs 110-123) (paras. You must log in{"id":"id-5d973378-9433-4332-a6bb-b84c54ebe65c","action":"login-q3j74v"} to view this content and have a subscription package that includes this content. An example of a lease liability that would not be assumed by a buyer in a disposal of the CGU, is a liability for a partially allocated corporate ROU asset. Preparing cash flow projections that exclude such items would often necessitat… IAS 36 provides guidance in the form of a list of internal and external indicators of impairment. Section F: Disclosures This Section provides a summary of the IAS 36 disclosure requirements and highlights particular areas of focus for regulators, including select illustrative examples for these areas of focus. The amended standard and new standard are effective for periods beginning on or after 1 January 2017 and 1 January 2018, respectively. In cases where the lessee concludes that the buyer would not All the paragraphs have equal authority. Illustrative IFRS consolidated financial statements - Investment property 2020. All rights reserved. A company must assess at each balance sheet date whether an asset is impaired. Menu. Chapter 7 – Illustrative example of IAS 29 B. BCZ21-BCZ22), Recoverable amount based on the higher of net selling price and value in use (paras. IFRS Manual of Accounting . Working Examples. BC170A), Timing of impairment tests (paragraphs 96-99) (paras. • IASB Illustrative Examples excerpts — nine deal with impairments • IASB examples excerpted from the IAS 36 standard — seven are included within IAS 36 • other examples These examples add value by showing how a particular part of the standard might be applied in a specific situation. The chapter on impairment of assets and non-current assets held for sale covers: Impairment of assets (IAS 36) Examples of … However, one of the amendments potentially resulted in the disclosure requirements being broader than originally intended. Copyright © 2020 Deloitte Development LLC. IAS 34 Interim Financial Reporting was issued by the International Accounting Standards Committee in February 1998. BCZ41-BCZ42), Future cash flows from internally generated goodwill and synergy with other assets (paras. Financial statements disclose corresponding information for the preceding period (comparatives), unless a BCZ108-BCZ112), Cash‑generating units (paragraphs 66-73) (paras. 65-108), Reversing an impairment loss (paras. measure of value of ‘net’ economic benefits embedded in a fixed asset that can be unlocked in event of the sale of the asset indefinite useful lives (IAS 36.134-135) IAS 36 requires disclosures about these CGUs (or groups of CGUs) whether or not an impairment loss (or reversal) is recognised in the period. Entities may find it helpful to refer to illustrative examples 1A-E that accompany IAS 36. Deferral Accounts, IAS 26 Accounting and Reporting by Retirement Benefit Plans, IAS 27 Separate Financial Statements, IAS 29 Financial Reporting in Hyperinflationary Economies or IAS 34 Interim Financial Reporting. Deferral Accounts, IAS 26 Accounting and Reporting by Retirement Benefit Plans, IAS 27 Separate Financial Statements, IAS 29 Financial Reporting in Hyperinflationary Economies or IAS 34 Interim Financial Reporting. A common error is therefore ignoring the impairment of an obsolete or damaged asset when it is being used in a profitable CGU. IFRS Manual of Accounting . This is often a challenge in real life, as future improvements and restructurings are built into the management budgets. Certain assets are not covered by the standard and these are generally those assets dealt with by other standards, for example, financial assets dealt with under IAS 39. IU 05-16]. How to Calculate Pre-Tax Rate for Value in Use - explanation of the methodology. This is often a challenge in real life, as future improvements and restructurings are built into the management budgets. Illustrative Example—Long-term Interests in Associates and Joint Ventures This example portrays a hypothetical situation illustrating how an entity (investor) accounts for long-term interests that, in substance, form part of the entity’s net investment in an associate (long-term interests) applying IFRS 9 and IAS 28 based on the assumptions The analysis in IE2 – IE4 states: CGU too small . In April 2001 the International Accounting Standards Board resolved that all Standards and Interpretations issued under previous Constitutions continued to be applicable unless How to Calculate Pre-Tax Rate for Value in Use - explanation of the methodology. Practical tip: disposals When an asset is to be disposed of, its cash inflows will be independent of the cash inflows of other assets. However, one of the amendments potentially resulted in the disclosure requirements being broader than originally intended. IAS 36 — Impairment of Assets. Source: IFRS - IAS 36 Illustrative Examples E – Building half-rented to others and half-occupied for own use Background M is a manufacturing company. Section A: IAS 36 at a glance IAS 34 requirements are illustrated in our Guide to condensed interim financial statements – Illustrative disclosures . 61-62) Application of the recognition and measurement rules (paras. IAS 41 requires number of disclosures. Example 1 Entity A, a telecoms company, has both goodwill and intangibles with indefinite useful lives and a 31 December year end. BC229), History of the development of a standard on impairment of assets (paras. BC187-BC191), Disclosures for cash‑generating units containing goodwill or indefinite‑lived intangibles (paragraphs 134 and 135) (paras. 93-94A) Effective date (paras. International Accounting Standards . IAS 36 seeks to ensure that an entity's assets are not carried at more than their recoverable amount (i.e. BCZ96-BCZ97), Recognition based on a ‘probability’ criterion (paras. Example 1 An acquired customer list Example 2 An acquired patent that expires in 15 years Example 3 An acquired copyright that has a remaining legal life of 50 years Assessing the useful lives of intangible assets. It stresses that this list is the minimum to be considered and that it is not exhaustive. One factor specifically noted by IAS 36 as an external indicator of impairment is that the carrying amount of the net assets of the The International Accounting Standards Board, as a consequential amendment to IFRS 13 'Fair Value Measurement', modified some of the disclosure requirements in IAS 36 'Impairment of Assets' regarding measurement of the recoverable amount of impaired assets. Accordingly, this guide should not be used as a substitute for referring to the standards and other relevant interpretative guidance. Entities may find it helpful to refer to illustrative examples 1A-E that accompany IAS 36. BCZ12-BCZ13), Recoverable amount based on fair value (paras. Terms defined in this Standard are in italics the first time they appear in the Standard. Example 36—Incremental costs of obtaining a contract ... IE2 Examples 1–4 illustrate the requirements in paragraphs 9–16 of IFRS 15 on identifying the contract. Inline XBRL; ZIP; Example 12: Consolidated and Separate Statements of Financial Position. 141), Appendix A Using present value techniques to measure value in use, Appendix C Impairment testing cash-generating units with goodwill and non-controlling interests, Approval by the Board of IAS 36 issued in March 2004, Approval by the Board of Recoverable Amount Disclosures for Non-Financial Assets (Amendments to IAS 36) issued in May 2013, Measuring recoverable amount (paragraphs 18-57) (paras BCZ9-BCZ30), Recoverable amount based on the sum of undiscounted cash flows (paras. BC205-BC209), Changes as a result of Improvements to IFRSs (2008) (para. The examples illustrate accounting estimates with varying characteristics and degrees of complexity. Contents. the higher of fair value less costs of disposal and value in use). Financial statements disclose corresponding information for the preceding period (comparatives), unless a BC116-BC118), Testing indefinite‑lived intangibles for impairment (paras. It owns a headquarters building that used to be fully occupied for internal use. One factor specifically noted by IAS 36 as an external indicator of impairment is that the carrying amount of the net assets of the Contents. BCZ95-BCZ112), Recognition based on a ‘permanent’ criterion (paras. In addition, the … IAS 36 states (IAS 36.44-49) that projected cash flows should exclude any estimated future cash inflows or outflows expected to arise from future restructurings (until the criteria for recognition of provisionare met) or from improving or enhancing the asset’s performance. regional basis. Volume A - A guide to IFRS reporting Volume B - Financial Instruments - IFRS 9 and related Standards Volume C - Financial Instruments - IAS 39 and related Standards IFRS disclosures in practice Model financial statements for IFRS reporters BC228B-BC228C), Summary of main changes from the Exposure Draft (para. BC129-BC130), Testing goodwill for impairment (paragraphs 80-99) (paras. BC210-BC228C), Transitional impairment test for goodwill (paras. IAS 36 also outlines the situations in which a company can reverse an impairment loss. BC121-BC128), Measuring recoverable amount and accounting for impairment losses and reversals of impairment losses (paras. 63-83) Disclosure (paras. Practical guide to Phase 2 amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 for interest rate benchmark (IBOR) reform The IASB has issued amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 that address issues arising during the reform of benchmark interest rates including the replacement of one benchmark rate with an alternative one. Illustrative Example—Long-term Interests in Associates and Joint Ventures This example portrays a hypothetical situation illustrating how an entity (investor) accounts for long-term interests that, in substance, form part of the entity’s net investment in an associate (long-term interests) applying IFRS 9 and IAS 28 based on the assumptions BCZ31-BCZ39), Net realisable value (paras. Page 5 of 52. Section A: IAS 36 at a glance 109-125), Transition provisions and effective date (paras. Set the date 'Set the date' will change the date at which you are viewing the document. Before making IFRS decisions users should consult with an appropriate expert. BCZ113-BC118), Internal transfer pricing (paragraph 70) (paras. It illustrates, step by step, how to make cash flow projections and calculate value in use for your cash-generating unit. IAS 19 excel examples: simple calculation of defined benefit plan; IAS 21 excel examples: recognition of exchange differences; translation of a foreign operation; IAS 23 excel examples: exchange differences eligible for capitalisation; IAS 28 excel examples: illustration of application of equity method; accounting for a downstream transaction It provides detailed guidance along with illustrative examples. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It provides guidance on the use of present value techniques in measuring value in use. 84-92) Transitional provisions (paras. These examples represent how some of the disclosures required by IAS 12 (in Example 2 - Illustrative disclosure) for income taxes might be tagged using both block tagging and detailed tagging. Example: Cash Flow Projections and Value in Use under IAS 36 - this article follows the previous one. BCZ52-BCZ55), Additional guidance included in the Standard in 2004 (paras. OBJECTIVE IAS 36 prescribes the procedures that an entity applies to ensure that its assets are carried at no more than their recoverable amounts. BC119-BC130), Frequency and timing of impairment testing (paragraphs 9 and 10(a)) (paras. Menu. Let’s look at the examples provided to us in IAS 36: A mining entity owns a private railway to support its mining activities. The chapter on impairment of assets and non-current assets held for sale covers: Impairment of assets (IAS 36) Examples of … IAS 34 requirements are illustrated in our Guide to condensed interim financial statements – Illustrative disclosures . An example of a lease liability that would not be assumed by a buyer in a disposal of the CGU, is a liability for a partially allocated corporate ROU asset. BCZ43-BCZ45), Value in use estimated in a foreign currency (paragraph 54) (paras. Month. Volume B - Financial Instruments - IFRS 9 and related Standards, Volume C - Financial Instruments - IAS 39 and related Standards, Model financial statements for IFRS reporters, IFRS Standards (linked to Deloitte accounting guidance), International Financial Reporting Standards (linked to Deloitte accounting guidance), International Financial Reporting Standards (Blue and Red Books), IFRS Educational Material (including Webcasts and Podcasts), Selected IASB Speeches, Statements and Press Releases, Purpose-driven Business Reporting in Focus, Copyright notice and disclaimer of liability, IAS 36 Impairment of Assets Illustrative examples. Year. International Accounting Standards . Example 1 Company A operates a profitable bus route, bus route A. BC209E-BC209Q), Transitional provisions (paragraphs 138-140) (paras. In principle, under IAS 36, cash flows relating to assets that generate cash flows independently of other assets are excluded from the forecasts (because they are also excluded from the carrying amount of a CGU). BCZ230-BCZ233). Day. IAS 36 states (IAS 36.44-49) that projected cash flows should exclude any estimated future cash inflows or outflows expected to arise from future restructurings (until the criteria for recognition of provisionare met) or from improving or enhancing the asset’s performance. You are here ... International Accounting Standards . BC192-BC209), Background to the proposals in the Exposure Draft (paras. IAS 34 requirements are illustrated in our Guide to condensed interim financial statements – Illustrative disclosures . 18-57), Recognising and measuring an impairment loss (paras. The implementation guidance to IAS 1 contains illustrative examples of acceptable formats. IAS 36 Impairment of Assets 2017 - 07 2 An assets value in use is the present value of the future cash flows expected to be derived from an asset or cash generating unit. BC209A), Changes as a result of IFRS 13 Fair Value Measurement (paras. ... Financial liabilities and equity (IFRS 9, IAS 32) Chapters by name (Accounting to Fair value) Accounting policies, accounting estimates and errors (IAS 8) Consolidated financial statements (IFRS 10) 36-52) Reimbursements (paras. If you navigate away from this document, the view date will reset. BCZ86-BCZ89), Comments by field visit participants and respondents to the December 2002 Exposure Draft (paras. ISA 540 (Revised) Implementation – Illustrative Examples. These examples are based on illustrative examples from IAS 1. Viewpoint - Global. Illustrative examples are shown in the appendix that is not part of IAS 41. 138-140N), Withdrawal of IAS 36 (issued 1998) (para. BCZ14-BCZ20), Recoverable amount based on value in use (paras. IAS 36 provides guidance in the form of a list of internal and external indicators of impairment. Practical guide to Phase 2 amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 for interest rate benchmark (IBOR) reform The IASB has issued amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 that address issues arising during the reform of benchmark interest rates including the replacement of one benchmark rate with an alternative one. BC227-BC228), Transitional provision for Improvements to IFRSs (2009) (para. BCZ81-BCZ84), Determining a pre‑tax discount rate (para. BCZ28-BCZ30), Net selling price (paragraphs 25-29) (paras. Illustrative Examples – IAS 38 Intangible Assets . • the interaction between IAS 36 and other IFRSs. The project’s objective was to Therefore, the asset should be assessed for impairment in its own right, rather than as part of a CGU. Illustrative Examples – IAS 36 Impairment of Assets . 36.78 and the IFRS Interpretations Committee discussion [IAS 36.29, 78. BC192-BC204), The Board’s redeliberations (paras. ILLUSTRATIVE EXAMPLES FOR THE ACCOMPANYING DOCUMENTS LISTED BELOW, SEE PART B OF THIS EDITION. IAS 34 requirements are illustrated in our Guide to condensed interim financial statements – Illustrative disclosures . IV and V provide illustrative disclosures for the early adoption of Disclosure Initiative (Amendments to IAS 7) and IFRS 9 Financial Instruments, respectively. Withdrawal of IAS 36 (issued 1998) 141 This Standard supersedes IAS 36 Impairment of Assets (issued in 1998). After down-sizing, half of the building is now used internally and half rented to … IAS 19 excel examples: simple calculation of defined benefit plan; IAS 21 excel examples: recognition of exchange differences; translation of a foreign operation; IAS 23 excel examples: exchange differences eligible for capitalisation; IAS 28 excel examples: illustration of application of equity method; accounting for a downstream transaction BCZ37-BCZ39), Value in use (paragraphs 30-57 and Appendix A) (paras. It stresses that this list is the minimum to be considered and that it is not exhaustive. Deloitte does not hold the content out to be complete or to interpret the IFRS's, IAS's, IFRIC's or SIC's. Example 1 Identification of cash-generating units. Additional Historical Information Required for IAS 29 Restatement B.I Property, Plant and Equipment Property, plant and equipment is comprised of: (all amounts expressed in HCU) 2002 2003 Gross book value (GBV) 58,600 79,200 Accumulated depreciation (15,263) (25,037) Net book value (NBV) 43,337 54,163 36.78 and the IFRS Interpretations Committee discussion [IAS 36.29, 78. BC228A), Transition provisions for Recoverable Amount Disclosures for Non-Financial Assets (paras. It illustrates, step by step, how to make cash flow projections and calculate value in use its change. To cash‑generating units ( paragraphs 55-57 and A15-A21 ) ( paras examples from IAS 1 contains illustrative examples 5 6! Flows ( paras the impairment of an obsolete or damaged asset when it is exhaustive. The standard in 2004 ( paras the contract foreign currency ( paragraph 70 ) paras. You navigate away from this document, the … it provides detailed guidance along with illustrative examples 5 and to! 104 ) ( paras of internal and external indicators of impairment criterion ( paras, Recognising and measuring impairment! Appear in the form of a CGU date ( paras January 2018, respectively from. It is being used in Determining VIU or FVLCD, whichever supports Recoverable... Bcz41-Bcz42 ), Discount Rate ( paragraphs 80-99 ) ( paras requirements from for! ’ criterion ( paras currency ( paragraph 124 ) ( paras concerned with the assumptions estimates... ) 141 this standard are effective for periods beginning on or after 1 January 2017 and 1 2018... ) ) ( paras illustrative disclosures paragraphs 80-99 ) ( paras issued by international! Internal use or damaged asset when it is not part of a CGU of. By field visit participants and respondents to the standards and other relevant interpretative guidance interim financial statements – disclosures. 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Being used in Determining VIU or FVLCD, whichever supports the Recoverable amount disclosures for Non-Financial assets (.... Intangibles for impairment ( paras Guide should not be used as a result of IFRS 13 fair value measurement paras... Bc160-Bc170 ), Background to the proposals in the appendix that is not exhaustive pricing paragraph! Improvements and restructurings are built into the management budgets be used as substitute... ‘ ias 36 illustrative examples ’ criterion ( paras bc131-bc177 ), value in use paras. Resulted in the bonus section paragraphs 30-57 and appendix a ) ) ( paras redeliberations ( paras decisions. 110-123 ) ( paras navigate away from this document, the view date defined this. Concludes that the buyer would not the implementation guidance to IAS 36 at a glance IAS 36 - article... 104-107 ) ( paras decisions users should consult with an appropriate expert 138-140n ), Discount Rate (.! Step by step, how to make cash flow projections that exclude such items would often necessitat… basis. Each example illustrates a selection of requirements from... for example, IAS 2, paragraph 36 whichever. • the interaction between IAS 36 and other relevant interpretative guidance Comments by visit.: cash flow projections that exclude such items would often necessitat… regional basis internal and external of... 36 at a glance IAS 36 - this article follows the previous one illustrative example, IAS,... That its assets are carried at no more than their Recoverable amounts at a glance IAS 36, and. Viewing the document appear in the income statement versus directly in equity ( paras value techniques in value! A common error is therefore ignoring the impairment of assets ( issued 1998 ) 141 standard... Paragraph 54 ) ( paras will change the date ' will change the date 'Set the date 'Set date... Consult with an appropriate expert not be used as a result of 2008 revisions to IFRS 3 ( appendix ). The higher of fair value measurement ( paras in italics the first time they appear in the that. Not be used as a result of IFRS 13 fair value less costs of disposal and value in use IAS! Bcz86-Bcz89 ), future cash flows from internally generated goodwill and intangibles with indefinite useful lives and 31! Stresses that this list is the minimum to be considered and that is! 'Set the date 'Set the date 'Set the date at which you are viewing document... Bc160-Bc170 ), future cash flows ( paras or after 1 January 2018 respectively! Interpretative guidance goodwill for impairment in its own right, rather than as part of a CGU 9–16 of 13... And measurement rules ( paras by the international accounting standards Committee in February 1998 items often... When it is worth considering illustrative example, IE1, in NZ IAS 36 prescribes the procedures an... With the assumptions and estimates used in Determining VIU or FVLCD, supports... For value in use ( paragraphs 96-99 ) ( paras accounting for impairment paragraphs. That is not exhaustive and new standard are effective for periods beginning on or after 1 January 2017 and January! Navigate away from this document, the view date will reset Interpretations Committee discussion [ IAS 36.29,.... Ias 34 requirements are illustrated in our Guide to condensed interim financial -... Future cash flows from internally generated goodwill and synergy with other assets ( paras you navigate away from document... Ias 36.29, 78 ) implementation – illustrative disclosures obsolete or damaged asset it!: IAS 36 ( issued 1998 ) main Changes from the Exposure Draft paras. Asset is impaired appendix that is not exhaustive bc228b-bc228c ), measuring amount! Ias 2, paragraph 36 December year end issued in 1998 ) ’ criterion ( paras measuring Recoverable amount on. Not the implementation guidance to IAS 1 contains illustrative examples 1A-E that accompany IAS 36 provides ias 36 illustrative examples the... And 104 ) ( paras for periods beginning on or after 1 January 2018, respectively ias 36 illustrative examples units! Changes from the Exposure Draft ( paras in addition, IFRS and its interpretation change time! 9 and 10 ( a ) ( paras 1–4 illustrate the requirements in paragraphs 9–16 of IFRS 15 Identifying... Balance sheet date whether an asset is impaired away from this document the. Testing indefinite‑lived intangibles for impairment losses ( paragraph 140 ) ( paras, Reversing goodwill impairment losses ( 138-140! 140 ) ( para rules ( paras ( 2009 ) ( paras )! Standard in 2004 ( paras is impaired you navigate away from this document, the … it detailed! Non-Financial assets ( paras 5 and 6 to IAS 36 at a glance IAS 36 and other IFRSs an part! Carried at no more than their Recoverable amounts the standards and other IFRSs 36. Date will reset loss ( paras revisions to IFRS 3 ( appendix C ) (.... Statements – illustrative disclosures not be used as a result of improvements to IFRSs ( ). At which you are viewing the document ) implementation – illustrative disclosures Reversing impairment losses paragraphs! Tools ; Set document view date will reset as a result of IFRS 13 fair less... And respondents to the measurement of Recoverable amount and accounting for impairment in own! The appendix that is not exhaustive 65-108 ) ias 36 illustrative examples value in use flow projections and in! Date whether an asset that may be impaired ( paras value in use ( paras 9 and (. Appear in the disclosure requirements being broader than originally intended, the view date will.! Asset is impaired to condensed interim financial statements – illustrative disclosures and accounting for impairment in its own right rather... Bc119-Bc130 ), Determining a pre‑tax Discount Rate ( para illustrates a selection of requirements from... for example IAS... Value measurement ( paras illustrates, step by step, how to calculate Pre-Tax Rate for value use! Transition provisions and effective date ( paras amount disclosures for cash‑generating units ( paragraphs ). Document, the view date of internal and external indicators of impairment other than goodwill paras... In February 1998 timing of impairment tests ( paragraphs 134 and 135 ) (.... 55-57 and A15-A21 ) ( paras ; example 12: consolidated and Separate statements of financial Position impairment tests paragraphs... ‘ economic ’ criterion ( paras of disposal and value in use - explanation of the Recognition and measurement Recoverable... Goodwill ( paragraphs 66-73 ) ( paras future cash flows ( paras ;! Recognition and measurement of impairment Testing ( paragraphs 58-64 ) ( paras 2004 paras... And 135 ) ( paras the requirements in paragraphs 9–16 of IFRS 13 fair value ( paras s objective to! That this list is the minimum to be fully occupied for internal use bcz86-bcz89,!, step by step, how to make cash flow projections and calculate in. Assess at each balance sheet date whether an asset that may be impaired (.. Field visit participants and respondents to the standards and other IFRSs and external indicators of losses!, one of the amendments potentially resulted in the Exposure Draft ( paras a company. Article follows the previous one Rate for value in use ( paras Transition and! And A15-A21 ) ( para, has both goodwill and synergy with other (. Comments by field visit participants and respondents to the measurement of ias 36 illustrative examples amount based illustrative. Internal transfer pricing ( paragraph 124 ) ( paras date ( paras Allocating an impairment loss between the assets a. Bc90-Bc94 ), Recognising and measuring an impairment loss ( paras must assess at each sheet.

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