IAS 36 - IAS 36 Impairment Master subtitle style Click to...

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Click to edit Master subtitle style 3/20/11 IAS 36 Impairment of Assets 1
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3/20/11 IAS 36 l Assets which must be tested include: Property, plant, and equipment (PPE) Intangible assets Goodwill Investments in subsidiaries l Assets which are not tested include: Receivables Inventories 2
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3/20/11 Indicators of Impairments l External Market value decline quicker than expected Decline in technological, market, economic, or legal environment Interest rate increases which increase discount rate used to determine asset’s value in use l Internal Obsolescence or physical damage to asset 3
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3/20/11 Recognition of Impairments l Definition : Impairment occurs when an asset’s carrying value exceeds its recoverable amount l Carrying value = Cost – Accumulated Depr. – Accumulated Impairment Losses l Recoverable amount is the greater of: Net selling price : Fair value less costs to sell 4
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3/20/11 US GAAP l Impairment loss occurs when book value exceeds future cash flows
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This note was uploaded on 03/19/2011 for the course ACCT 440 taught by Professor Smith during the Spring '11 term at Saginaw Valley.

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IAS 36 - IAS 36 Impairment Master subtitle style Click to...

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