Page 9 - Finac1 Test 3 slides - 3. Impairment of Assets

TEST 3 PREPARATION

What is impairment?

• Impairment will occur when the carrying amount of

the asset in the books of the entity exceeds the

asset's recoverable amount. This will lead to an

impairment loss.

• The impairment loss may be reversed if there is any

indication that an impairment loss recognised for

an asset in prior years may no longer exist or may

have decreased.

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