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2 IAS 36 Impairment of Assets This fact sheet is based on existing requirements as at 31 December 2015, and does not take into account recent

How to fill out ias 36 impairment of

How to fill out ias 36 impairment of?

1. Assess the Recoverable Amount: The first step in filling out ias 36 impairment of is to assess the recoverable amount of the asset or cash-generating unit. This involves estimating the future cash flows expected to be derived from the asset and determining the appropriate discount rate to calculate the present value of those cash flows.
2. Compare Recoverable Amount and Carrying Amount: Next, compare the recoverable amount with the carrying amount of the asset. If the carrying amount exceeds the recoverable amount, an impairment loss needs to be recognized.
3. Recognize Impairment Loss: If the recoverable amount is lower than the carrying amount, an impairment loss must be recognized. The impairment loss is calculated as the difference between the carrying amount and the recoverable amount, and it should be reported in the income statement. Additionally, the carrying amount of the asset should be reduced to its recoverable amount.
4. Consider Reversal of Impairment Loss: It is important to note that if the circumstances that led to the impairment loss changes in the future, the impairment loss may be reversed. However, the reversal should not exceed the carrying amount that would have been determined without any impairment loss in previous years.

Who needs ias 36 impairment of?

1. Entities: Ias 36 impairment of applies to all entities that prepare financial statements in accordance with International Financial Reporting Standards (IFRS).
2. Asset Holders: It is particularly relevant for entities that hold tangible assets, intangible assets, or goodwill, as ias 36 impairment of provides guidance on how to assess whether these assets are impaired.
3. Accountants and Auditors: Professionals responsible for preparing and reviewing financial statements should have a thorough understanding of ias 36 impairment of to ensure compliance with the reporting requirements.
4. Investors and Stakeholders: Investors and stakeholders interested in the financial performance and position of a company rely on accurate information regarding impairment of assets, making ias 36 impairment of relevant to them as well.
5. Regulatory Authorities: Regulatory authorities that oversee financial reporting standards may require entities to comply with ias 36 impairment of, making it necessary for those entities to understand and adhere to the standard.

Overall, ias 36 impairment of provides guidance on how to assess and recognize impairment losses for various types of assets, and its relevance extends to entities, asset holders, accountants, auditors, investors, stakeholders, and regulatory authorities.

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