Page 78 - SBR Integrated Workbook STUDENT S18-J19
P. 78
Chapter 5
Example 6
Impairment
Dolby has performed an impairment review on a cash generating unit (CGU).
The CGU was deemed to have a value in use of $65 million and a fair value
less costs to sell of $55 million. Before the impairment review, the carrying
amounts of the assets of the CGU were as follows:
Carrying
amount
$m
Goodwill 25
Other intangible assets 10
Property, plant and equipment 40
Inventories 9
Trade receivables (net of loss allowance) 12
Cash and cash equivalents 4
––––
100
––––
The inventories are valued at the lower of cost and net realisable value.
Advise the directors of Dolby on how to deal with the CGU impairment
review.
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