Impairment

Question 1

Under ASPE, how is Impairement Tested

Answer 1

2 Step Process
Step 01: Is the CV > Discounted Futures CFS (Recoverable Value)
Step 02: If Yes, Impairment =CV-FMV

Question 2

Under IFRS, How is Impairment Tested

Answer 2

Is the Recoverable value < CV? If yes there is impairment.
Impairment = CV-Recoverable Value

Recoverable value is higher of

• FMV - Selling costs of
• Value in Use = Future Discounted Cashflows + FMV at Disposal

Question 3

When Is Impairment Testing Done?

Answer 3

IFRS: When there are indicators present for that indicate potential Impairment
ASPE: There are events that to suggest the CV value of the asset is not recoverable

Question 4

Do we assess for impairment indicators annually

Answer 4

IFRS: Yes
ASPE: No