FR - Non-current assets Held for Sale Flashcards

1
Q

What is a non-current asset held for sale defined

A
  • Non-current assets (HFS) - will have their carrying value recovery through a sales transaction rather than through continuing use
  • HFS can be a component of a company an individual or a group of non-current asset

Disposal group - is a group of assets and liabilities to be disposed of together in a single transaction

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Explains what the initial measurement for the non-current assets

A

Under IFRS 5 - must meet the criteria must meet following condition
1. Asset must be available for immediate sale in its present condition
2. Terms of the sale must be usual and customary
3. The sale must be highly probable. Factor include

  • Management must be committed to a plan to sell the asset (disposal group)
  • An active program to locate a buyer and complete the plan must have been initiated
  • The asset must be actively marketed for sale at a price that is reasonable about current FV
  • Asset measured at lower of carrying value and its FV - less cost to sell, Classfication to HFS is recognized in income, no gain can be recognized

Dr. HFS asset xx
Dr. Impairment loss. xx
Dr. Accumu. Depre. xx
Cr. Asset. xx

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Explain what subsequent measurement should be used

A
  • Depreciation is not taken after the asset is classified as HFS
  • FV less cost to sell of the HFS asset subsequent increase, the asset can be written up to the extent of any previous impairment losses taken
  • When subsequently is written up to max. What is original, non-impaired, depreciated value would have been at the date that it was classified as HFS

Dr. HFS - asset. xx
Cr. Reversal of impairment xx

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What is the derecognition of the HFS asset

A
  • Disposal, HFS asset, gain or loss, net of tax, recognized through the statement of CI/ included in calculation of profit/ loss

Dr. Cash. xx
Dr. Cr. loss/ gain on sale of asset xx
Cr. HFS - asset. xx

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Explain what the abandoned asset is

A
  • These assets remain classified on the SFP as long-term asset.
  • Types of assets that are considered abandoned include non-current assets that are to be used at the end of their useful lives and asset that are intended to be closed
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

What is the presentation needed is for non-current asset

A
  • Non current assets as HFS are presented as separatable from other assets on SFP

Disclosure
1. Description of asset
2. Circumstances of the sale or for the disposal that hasn’t occurred
3. Whether an asset that was previously stated classified as HFS has been reclassified

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Explain the difference between IFRS & ASPE

A

ASPE 3475 - HFS does not apply held for distribution to owner under ASPE
- Is FV less cost to sell increases, the reversal of any previous impairment losses is limited to the losses incurred after the asset was classified as HFS

How well did you know this?
1
Not at all
2
3
4
5
Perfectly