Unformatted text preview: nt as defined in IFRS 8 Operating Segments, before aggregation. An impairment loss is recognised and measured at the amount by which the CGU's carrying amount, including goodwill, exceeds its recoverable amount. Discussion Paper Extractive Activities
Proposals maintain the exemption from applying all requirements of IAS 36 to E&E assets The project team's proposals relating to impairment included the following.
l The indicators of impairment for E&E assets differ from those in IAS 36. When management determines that there is a high likelihood that the carrying amount of the asset will not be recovered, then the E&E asset should be tested for impairment.
l The proposals concluded that IAS 36 should not be applied to E&E assets. The basis for this proposal was a view that it is not possible to make a reliable judgement of whether the carrying amount is less than the recoverable amount until sufficient information is available.
l Impairment reversals
Reversal of impairment losses restricted Impairment losses related to goodwill cannot be reversed. However, for other assets companies assess whether there is an indication that a previously recognised impairment loss has reversed. If there is such an indication, then impairment losses are reversed if the recoverable amount has increased, subject to certain restrictions. Of respondents who commented on impairment, most (73%) opposed the proposals. Some respondents suggested that the IASB include a review of IAS 36 in any future project to alleviate difficulties in applying IAS 36 to E&E assets. The potential of the proposed approach to delay recognition of any impairment loss and the reliance on management judgement were noted by some respondents. Some respondents remarked that the fact that the IAS 36 impairment test approach is not considered to work for E&E assets may imply that the project team has proposed the wrong asset recognition model. 2011 KPMG International Cooperative ("KPMG International"...
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