Page 34 - FINAL CFA I SLIDES JUNE 2019 DAY 8
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Session Unit 8:

                                                                                                        29. Long-lived Assets
          LOS 29.k: Explain and evaluate how impairment, revaluation, and de-recognition of property, plant, and
          equipment and intangible assets affect financial statements and ratios. p226

                                                             In year of impairment/de-recognition          Years subsequent to
                                                                                                       impairment/de-recognition

                                                                                   Revaluation, p.227
          Impact On


          Assets (Carrying value)
                                                         tanties
          Equity (retained earnings)

          D/A; D/E


          Net income


          ROA

          ROE


          Asset turnover


          Cash flows

         CFA watch out:

         Revaluations could be indications of earnings smoothing,                     •    Check source of revaluation appraisal
         poor depreciation/amortisation judgments                                          to support this!
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