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Before reclassified as held for sales , impairment will be tested on individual CGU basis.
The impairment is $16K.After reclassified as held for sales ,the asset will be measured at lower of CA or fair value. If subsequent found the asset value increase $40K.
Question : what will be the entry for the first impairment loss of $16K , isn’t recognised to IC ? And what are the impact / adjustment for the subsequent value increase of the $40k?
Hi Mike,
Here is the original statement:
Measurement of non-current assets which are held-for-sale
When non current assets or disposal groups are classified as help-for-sale,
they are measured at the lower of the carrying amount and fair value less cost to sell.
Any Subsequent increases in fair value less cost to sell of the asset can be recognised in profit and lost to the extent that it is not in excess of the cumulative impairment loss that has been recognised.My Question is:
I do not understand what does it mean by:
Any Subsequent increases in fair value less cost to sell of the asset can be recognised in profit and lost to the extent that it is not in excess of the cumulative impairment loss that has been recognisedIt means that, if the ahfs has increased in value on a reassessment of values, then the gain should be recognised through I/S, but you cannot recognise a gain to show the asset at an amount greater than the pre-impaired value of that asset.
If, on reclassification as ahfs, there was an impairment loss bringing the asset down from (say) 100 to (say) 80, and then there has been a subsequent increase in values, that subsequent increase going through I/S shall not exceed the 20 previous impairment.
OK?
Hi Mike,
Thanks for your explaination.My question again.
What if subsequent increase in value is exceed the 20 previous impairment (say) 30. So 20 will going through I/S .
Then what about the balance of 10?
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