Impairment of Assets IAS 36 : Assignment

IMPAIRMENT OF ASSETS 1
IMPAIRMENT OF ASSETS

IMPAIRMENT OF ASSETS 2
Executive summary:
The IAS 36 is concerned with the impairment of the assets. This accounting standard makes
sure that the assets that belong to the entity are not carried at the value which is more than the
recoverable amount. This merely means that the recoverable amount is the higher of the fair
value less the costs of the disposal and the value in use. But there is an exception to the same
which is goodwill and then there are some of the intangible assets in respect of which an
annual impairment is required and hence, these assets are checked. These entities conduct an
impairment test each year whenever there is an indication that an asset which belongs to the
company could be impaired. Then the tests may be conducted for a cash generating unit
wherein an asset is not able to generate in the cash inflows which depends on the other assets
(IAS plus, 2017).

IMPAIRMENT OF ASSETS 3
Contents
Introduction:...............................................................................................................................4
Evidence of impairment testing:................................................................................................4
Procedure for impairment:.........................................................................................................4
Information required:.................................................................................................................5
Flexibility of the management:..................................................................................................6
Conclusion:................................................................................................................................6
References..................................................................................................................................7