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CR – May 2017 – L3 – Q3c – Impairment of Assets (IAS 36)

Allocate an impairment loss across assets in a cash-generating unit based on IAS 36.

Question

A cash-generating unit holds the following assets:

Asset	Value (N’Million)
Goodwill	160
Patent	320
Property, Plant and Equipment	480

An annual impairment review is required as the cash-generating unit contains goodwill. The most recent review assesses its recoverable amount to be N720 million. An impairment loss of N240 million has been incurred and has been recognised in profit or loss.

Required:
Show how the value of the assets held by the cash-generating unit will change after the impairment test based on the information provided above.

Answer

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Tags: Asset Allocation, CGU, Goodwill, IAS 36, Impairment Loss
Level: Level 3

Topic: Impairment of Assets (IAS 36)

CR – Mar 2024 – L3 – Q2b – IAS 36: Impairment of Assets

This question focuses on determining impairment losses and adjusting carrying values for the CGUs of Sikaman Plc, considering head office allocation.

Question

Sikaman Plc has three cash-generating units (CGUs), a head office, and a research facility. The carrying amounts of the assets and their recoverable amounts are as follows:

	Unit X	Unit Y	Unit Z	Head Office	Research Facility	Sikaman Plc
Carrying value (GH¢m)	500	700	1,000	750	250	3,250
Recoverable amount (GH¢m)	645	820	1,355	–	–	2,920

The assets of the head office can be reasonably allocated to the three units as follows:

Unit X: GH¢95m
Unit Y: GH¢280m
Unit Z: GH¢375m

The assets of the research facility cannot be reasonably allocated to the CGUs.

Required:
Assuming all assets can be adjusted for impairment, show how the revised/adjusted carrying values of the assets of Sikaman Plc should be determined in line with IAS 36: Impairment of Assets after taking into account any impairment losses in the above scenario. Show the relevant financial statements extracts.

Answer

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Tags: Carrying Value, CGU, Head Office Allocation, IAS 36, Impairment, Research Facility
Level: Level 3

Topic: IAS 36: Impairment of assets
Series: MAR 2024

CR – May 2017 – L3 – Q3c – Impairment of Assets (IAS 36)

Allocate an impairment loss across assets in a cash-generating unit based on IAS 36.

Question

A cash-generating unit holds the following assets:

Asset	Value (N’Million)
Goodwill	160
Patent	320
Property, Plant and Equipment	480

Required:
Show how the value of the assets held by the cash-generating unit will change after the impairment test based on the information provided above.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Asset Allocation, CGU, Goodwill, IAS 36, Impairment Loss
Level: Level 3

Topic: Impairment of Assets (IAS 36)

CR – Mar 2024 – L3 – Q2b – IAS 36: Impairment of Assets

This question focuses on determining impairment losses and adjusting carrying values for the CGUs of Sikaman Plc, considering head office allocation.

Question

Sikaman Plc has three cash-generating units (CGUs), a head office, and a research facility. The carrying amounts of the assets and their recoverable amounts are as follows:

	Unit X	Unit Y	Unit Z	Head Office	Research Facility	Sikaman Plc
Carrying value (GH¢m)	500	700	1,000	750	250	3,250
Recoverable amount (GH¢m)	645	820	1,355	–	–	2,920

The assets of the head office can be reasonably allocated to the three units as follows:

Unit X: GH¢95m
Unit Y: GH¢280m
Unit Z: GH¢375m

The assets of the research facility cannot be reasonably allocated to the CGUs.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Carrying Value, CGU, Head Office Allocation, IAS 36, Impairment, Research Facility
Level: Level 3

Topic: IAS 36: Impairment of assets
Series: MAR 2024

Question Tag: CGU

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CR – May 2017 – L3 – Q3c – Impairment of Assets (IAS 36)

Allocate an impairment loss across assets in a cash-generating unit based on IAS 36.

CR – Mar 2024 – L3 – Q2b – IAS 36: Impairment of Assets

This question focuses on determining impairment losses and adjusting carrying values for the CGUs of Sikaman Plc, considering head office allocation.

CR – May 2017 – L3 – Q3c – Impairment of Assets (IAS 36)

Allocate an impairment loss across assets in a cash-generating unit based on IAS 36.

CR – Mar 2024 – L3 – Q2b – IAS 36: Impairment of Assets

This question focuses on determining impairment losses and adjusting carrying values for the CGUs of Sikaman Plc, considering head office allocation.

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CR – May 2017 – L3 – Q3c – Impairment of Assets (IAS 36)

Allocate an impairment loss across assets in a cash-generating unit based on IAS 36.

You're reporting an error for "CR – May 2017 – L3 – Q3c – Impairment of Assets (IAS 36)"

CR – Mar 2024 – L3 – Q2b – IAS 36: Impairment of Assets

This question focuses on determining impairment losses and adjusting carrying values for the CGUs of Sikaman Plc, considering head office allocation.

You're reporting an error for "CR – Mar 2024 – L3 – Q2b – IAS 36: Impairment of Assets"

CR – May 2017 – L3 – Q3c – Impairment of Assets (IAS 36)

Allocate an impairment loss across assets in a cash-generating unit based on IAS 36.

You're reporting an error for "CR – May 2017 – L3 – Q3c – Impairment of Assets (IAS 36)"

CR – Mar 2024 – L3 – Q2b – IAS 36: Impairment of Assets

This question focuses on determining impairment losses and adjusting carrying values for the CGUs of Sikaman Plc, considering head office allocation.

You're reporting an error for "CR – Mar 2024 – L3 – Q2b – IAS 36: Impairment of Assets"

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