1-
If subsidiary is tested for impairment.
We compare [ Net Assets+FV Adj reqd + Grossed up /Full Goodwill ] with Recoverable Amount of Subsidiary.
And for Associate We compare [Carrying amount of investment (adjusted if reqd)] with Recoverable amount.
is it right ?
2-What do the standards mean when they say that reversal of any impairment losss will be recognized to the extent that recoverable amount of investment in associate is increased. [What is it they trying us to avoid ? ]
Ask the Tutor ACCA SBR
Impairment of Investment in Associate
12y ago#11) yes
2) it's an intangible asset. "INCA should not be shown at a value that exceeds the lower of carrying value compared with recoverable amount" So the Investment in Associate was impaired because recoverable amount was lower than carrying value, and now it is to be un-impaired because recoverable amount has risen above the previously calculated recoverable amount
OK?
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