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IAS 36

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › IAS 36

  • This topic has 1 reply, 2 voices, and was last updated 4 years ago by Stephen Widberg.
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  • March 10, 2021 at 11:44 am #614095
    humai
    Participant
    • Topics: 757
    • Replies: 248
    • ☆☆☆☆☆

    As per IAS 36, an entity must asses at the end of each reporting period that whether there is any indication that asset may be impaired. Asset is said to be impaired when its carrying amount exceeds recoverable amount. If there is indication of impairment, then asset should be tested for impairment i.e its recoverable amount must be calculated and asset should be reduced to recoverable amount if carrying amount is higher than recoverable amount. Recoverable amount is higher of value in use and fair value less cost to sell. Value in use is preset value of all future cashflows. Any impairment loss should be recorded in PNL

    Sir in the above para in the beginning I have written that as per IAS 36…. However I have not quoted exact words of standard, so would it be fine to write in our own words ?

    March 11, 2021 at 9:29 am #614162
    Stephen Widberg
    Keymaster
    • Topics: 16
    • Replies: 3411
    • ☆☆☆☆☆

    Writing in your own words is fine. The marker will be scanning your answer for the magic words IMPAIRMENT INDICATOR, RECOVERABLE AMOUNT and PROFIT AND LOSS ACCOUNT.

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