Impairment of Non-Financial Assets (IAS 36/AASB 136)

Corporate Reporting Insights

BDO's monthly newsletter, Corporate Reporting Insights, keeps you up to date with the latest Australian and global developments in corporate financial and sustainability reporting.

• Changes in the pipeline for business combinations, goodwill and impairment (April 2024)
• Impairment testing – Can market capitalisation be used to determine fair value less costs of disposal? (April 2023)
• What the six recent interest rate increases mean for your 31 December 2022 financial statements (October 2022)
• Are you using the correct ‘unit of account’ when testing your right-of-use assets for impairment? (September 2022)
• Impairment still the top area for ASIC surveillance of financial reports; followed by the OFR (February 2022)
• Accounting for impairment of assets (IAS 36) (November 2021)​
• ​Bed licences - Have you reviewed carr​ying amounts and estimated useful lives in 30 June 2021 financial statements?​ (October 2021)​
• Impact of Melbourne Stage 3 & 4 lockdowns on amounts recognised in 30 June 2020 financial statements and going concern assessments​​ (August 2020)
• Almost 25% of financial reports reviewed by ASIC result in enquiries on the appropriate accounting treatment​ (March 2020)
• Blind Freddy - Common errors in accounting for impairment - Part 5 - Testing goodwill for impairment (November 2016)
• Blind Freddy – Common errors in accounting for impairment – Part 4 – Not testing impairment at the correct unit of account (October 2016)
• Blind Freddy – Common errors in accounting for impairment – Part 3 – Errors when determining fair value less costs of disposal (September 2016)
• Blind Freddy – Common errors in accounting for impairment – Part 2c – Errors in determining discount rate (August 2016)
• Blind Freddy - Common errors in accounting for impairment - Part 2b (July 2016)
• Blind Freddy – Common errors in accounting for impairment– Part 2a​ (June 2016)
• Blind Freddy – Common errors in accounting for impairment– Part 1 (May 2016)
• Is there a difference between ‘current replacement cost’as a measure of fair value (AASB 13) and ‘depreciated replacement cost’ as ameasure of value in use (AASB 136)?​ (September 2015).

BDO Global IFRS Resources

The following publications have been produced by the BDO Global IFRS group:

► IFRS at a Glance

A high level overview of International Financial Reporting Standards (IFRSs), including International Accounting Standards and Interpretations.

• IAS 36 Impairment of Assets
• IFRIC 10 Interim Financial Reporting and Impairment.

► IFRS in Practice

Practical information about the application of key aspects of IFRS, including industry specific guidance.

• IAS 36 Impairment of Assets (July 2024)​.

► IFR Bulletins

Focus on latest developments in international reporting.

• IASB publishes Exposure Draft – Business combinations - Disclosures, Goodwill and Impairment (IFRB 2024 03)
• ​Effects of climate-related matters on financial statements (IFRB 2020 14)
• Impairment implications of COVID-19 (IFRB 2020 07)
• Potential effects of the coronavirus outbreak on 31 December 2019 year-end financial reporting ​(IFRB 2020 02).

Webinars

BDO Australia conducts monthly complimentary webinars as an easy way to stay up to date with changes to accounting standards and other financial reporting developments. Recent webinars on this topic include:

• Understanding the what, how and when of conducting impairment testing (July 2024)
• Practical tips on impairment testing (July 2022).
• Cash flow forecasting for impairment testing and going concern (June 2021)
• Impairment testing after the implementation of IFRS 16​ (April 2020).

IFRIC agenda decisions

IFRS Interpretations Committee (the Committee) agenda decisions are those issues that the Committee decided not to take onto its agenda. Although not authoritative guidance, in practice they are regarded as being highly persuasive, and all entities reporting under IFRS should be aware of these decisions because they could impact the way particular transactions and balances are accounted for. Agenda decisions on this topic include:

• Considering recognising liabilities in determining recoverable amount and carrying amount of a CGU (May 2016) and FAQ
• Impairment of investments in associates in separate financial statements – IAS 28 (January 2013) and FAQ
• Calculation of value in use – dividend discount models (November 2010) and FAQ
• Interaction of transition requirements in IFRS 8 and IAS 36 (March 2010) 
• Identifying CGUs in the retail industry (March 2007)​ and FAQ.

Online training resources

Improve your knowledge of accounting standards by purchasing our online training resources on a variety of financial reporting topics. Resources available on this topic include:

• eLearning – a self-paced interactive web-based eLearning module that provides an in-depth understanding of the key aspects of the accounting standard and requires participants to read and answer questions relating to the content.