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ARTICLE · 29 AUGUST 2012

Impairment Of Long-Lived Assets - Key IFRS Reminders

PwC Management Services LP
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Under both old Canadian GAAP and IFRS, the basic principle for impairments is the same – recognize a loss if the recoverable amount of an asset or group of assets is less than its carrying amount.

CanadaAccounting and Audit
Tahir Ayub
Tahir Ayub

Under both old Canadian GAAP and IFRS, the basic principle for impairments is the same – recognize a loss if the recoverable amount of an asset or group of assets is less than its carrying amount. Nevertheless, the requirements for determining when and how to test for impairment, and what to disclose, can be significantly different. In this memorandum, we summarize key reminders for achieving IFRS compliance at year end.1

1. Watch for impairment indicators. Testing for impairment is necessary if there is any indication that an asset or group may be impaired. Indicators include:

  • A company's market capitalization below the carrying of its net assets.
  • Adverse changes in operations such as, discontinuing or restructuring operations, disposal plans, etc.

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