Reclassification of "Asset held for Sale" - IFRS 5

Shurwhynot

Hi all,

I just have a quick query that I can't find an answer to in my notes.

If an asset treated under IFRS 5 is to be reclassified as a normal asset under IAS 16 - you

DR Non Current Assets
Cr Asset Held for Sale

The Non current asset should be measured at the lower of:

- Its carrying amount before it was held for sale less any depreciation that would have been charged had it not been classed as held for sale and

- Its recoverable amount at the date of reclassification.

So if an asset is being carried as held for sale and is on the Balance Sheet at €850,000 and then it is to be reclassed with a value of €780,000, do you Cr the asset and Dr Impairment €70,000 in the P & L?

KingEnda

That sounds correct. I think you would charge the extra impairment where-ever you put depreciation in the SOCI

Shurwhynot

KingEnda wrote: »

That sounds correct. I think you would charge the extra impairment where-ever you put depreciation in the SOCI

Cheers mate, thats what I was thinking.