Summary
Summary Impairment IAS 36
- Course
- Accounting 200
- Institution
- University Of Johannesburg (UJ)
Brief summary of impairment on assets and financial instruments
[Show more]
Content preview
Impairment Description
Amount by which carrying amount exceeds the
recoverable amount
The recoverable amount is the higher of value in use and fair value (less costs
to dispose)
Costs to dispose of the asset do not include interest or income tax
Loss is limited to carrying amount of an asset
Identification
Ensures that assets are not overstated
Where an individual asset does not have a flow of economic benefits the group
of assets should be test
When to test?
When there is an indication of impairment (in an assessment situation a
scenario regarding the asset will be given which will lead you to test for
impairment)
Certain assets must be tested every year for impairment
Intangibles with infinite useful life
Intangibles still in the process of being completed
Goodwill
Measurement of the recoverable amount
Fair value less costs to sell:
The value is the price in an arm’s length transaction
Costs of disposal are costs required to bring asset into a saleable
condition
Value in use
PV of future cash flows (TVM calculation)
Recognition
Expenses unless revaluation impairment
Reversal of impairment
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller sjg2797. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R50,00. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
83662 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy summaries for 14 years now