Impairment of individual Assets

Impairment of individual Assets

by JEANNETTE NIYONSENGA -
Number of replies: 1

Impairment : is reduction in the recoverable amount of an asset or cash  generating unit below its carrying amount 

Impairment loss: is the amount by which the carrying amount of an asset or cash generating unit exceed its recoverable amount 

 

Impairment of individual Asset:    in same cases an entity may hold assets that are reported in their finacial statements at a value  greater than their recoverable value . Such  posotion came to the light during period of economic  down turns or financial crisis as witblnessed at the start of this century . IAS 36 seeks to ensure thart financial statements do not include asset at a value for which they can not be recovered .