Get the free Impairment of long-lived assets, goodwill and intangible - EY

Impairment of long-lived assets, goodwill and intangible assets US GAAP and IFRS Media & Entertainment Contents 2 6 8 12 20 22 Overview of impairment principles Indicators of impairment for long-lived

How to fill out impairment of long-lived assets

How to fill out impairment of long-lived assets:

1. Assess the assets: Firstly, identify the long-lived assets that may have incurred impairment. This includes property, plant, and equipment, intangible assets, and investments in subsidiaries or affiliates. Evaluate their fair value and estimate their useful life.
2. Determine the recoverable amount: Calculate the recoverable amount of the assets, which is the higher of its fair value less costs to sell or its value in use. Fair value can be determined through market-based valuations, while value in use is assessed by discounting future cash flows.
3. Compare recoverable amount to carrying amount: Compare the recoverable amount to the carrying amount of each asset. The carrying amount is the asset's net book value, which is the historical cost minus accumulated depreciation or amortization. If the recoverable amount is lower than the carrying amount, there may be impairment.
4. Recognize impairment loss: If the recoverable amount is lower than the carrying amount, recognize an impairment loss. The impairment loss is calculated as the difference between the carrying amount and the recoverable amount. Debit the impairment loss expense and credit the asset's carrying amount.
5. Calculate the new carrying amount: After recognizing the impairment loss, adjust the carrying amount of the asset to its recoverable amount. This will be the new basis for subsequent depreciation, amortization, or revaluation.

Who needs impairment of long-lived assets:

1. Companies: Impairment of long-lived assets is primarily relevant for companies that hold such assets on their balance sheets. This includes businesses in various industries, such as manufacturing, real estate, technology, and transportation.
2. Investors: Investors who analyze financial statements and make investment decisions need to understand the impairment of long-lived assets. Impairment can impact a company's profitability, liquidity, and overall financial health.
3. Auditors and regulators: Auditors and regulatory bodies review a company's financial statements for compliance and accuracy. They assess the impairment testing process and ensure that it follows the relevant accounting standards, such as Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS).

For pdfFiller’s FAQs

How can I get impairment of long-lived assets?

It's simple with pdfFiller, a full online document management tool. Access our huge online form collection (over 25M fillable forms are accessible) and find the impairment of long-lived assets in seconds. Open it immediately and begin modifying it with powerful editing options.

How do I complete impairment of long-lived assets online?

pdfFiller has made it easy to fill out and sign impairment of long-lived assets. You can use the solution to change and move PDF content, add fields that can be filled in, and sign the document electronically. Start a free trial of pdfFiller, the best tool for editing and filling in documents.

How do I fill out impairment of long-lived assets using my mobile device?

You can quickly make and fill out legal forms with the help of the pdfFiller app on your phone. Complete and sign impairment of long-lived assets and other documents on your mobile device using the application. If you want to learn more about how the PDF editor works, go to pdfFiller.com.

What is impairment of long-lived assets?

Impairment of long-lived assets occurs when the carrying amount of the asset exceeds its recoverable amount.

Who is required to file impairment of long-lived assets?

Companies that hold long-lived assets must assess for potential impairment and make necessary adjustments in their financial statements.

How to fill out impairment of long-lived assets?

Impairment of long-lived assets is completed by performing an impairment test to determine if the carrying amount exceeds the recoverable amount. If so, an impairment loss is recognized.

What is the purpose of impairment of long-lived assets?

The purpose of impairment of long-lived assets is to ensure that assets are not carried at more than their recoverable amount, reflecting their true value in the financial statements.

What information must be reported on impairment of long-lived assets?

Companies must disclose the amount of impairment loss recognized and provide details on the assets that were impaired in their financial statements.