Impairment of Assets
(a)
inventories (see Ind AS 2, Inventories);
(b)
1 contract assets and assets arising from costs to obtain or fulfil a contract that are recognised in accordance with Ind AS 115, Revenue from Contracts with Customers;
(c)
deferred tax assets (see Ind AS 12, Income Taxes);
(d)
assets arising from employee benefits (see Ind AS 19, Employee Benefits);
(e)
financial assets that are within the scope of Ind AS 109, Financial Instruments;
(f)
[Refer Appendix 1];
(g)
biological assets related to agricultural activity within the scope of Ind AS 41 Agriculture that are measured at fair value less costs to sell ;
(h)
2 contracts within the scope of Ind AS 117 , Insurance Contracts, that are assets and any assets for insurance acquisition cash flows as defined in Ind AS 117; and
(i)
non-current assets (or disposal groups) classified as held for sale in accordance with Ind AS 105, Non-current Assets Held for Sale and Discontinued Operations .
(a)
subsidiaries, as defined in Ind AS 110, Consolidated Financial Statements;
(b)
associates, as defined in Ind AS 28, Investments in Associates and Joint Ventures ; and
(c)
joint ventures, as defined in Ind AS 111, Joint Arrangements.
(a)
If the disposal costs are negligible, the recoverable amount of the revalued asset is necessarily close to, or greater than, its revalued amount. In this case, after the revaluation requirements have been applied, it is unlikely that the revalued asset is impaired and recoverable amount need not be estimated.
(b)
[Refer Appendix 1]
(c)
If the disposal costs are not negligible, the fair value less costs of disposal of the revalued asset is necessarily less than its fair value. Therefore, the revalued asset will be impaired if its value in use is less than its revalued amount. In this case, after the revaluation requirements have been applied, an entity applies this Standard to determine whether the asset may be impaired.
(a)
the period of time over which an asset is expected to be used by the entity; or
(b)
the number of production or similar units expected to be obtained from the asset by the entity.
(a)
paragraphs 18– 57 set out the requirements for measuring recoverable amount. These requirements also use the term ‘an asset’ but apply equally to an individual asset and a cash-generating unit.
(b)
paragraphs 58– 108 set out the requirements for recognising and measuring impairment losses. Recognition and measurement of impairment losses for individual assets other than goodwill are dealt with in paragraphs 58–64. Paragraphs 65–108 deal with the recognition and measurement of impairment losses for cash-generating units and goodwill.
(c)
paragraphs 109– 116 set out the requirements for reversing an impairment loss recognised in prior periods for an asset or a cash-generating unit. Again, these requirements use the term ‘an asset’ but apply equally to an individual asset or a cash-generating unit. Additional requirements for an individual asset are set out in paragraphs 117–121, for a cash-generating unit in paragraphs 122 and 123, and for goodwill in paragraphs 124 and 125.
(d)
paragraphs 126– 133 specify the information to be disclosed about impairment losses and reversals of impairment losses for assets and cash-generating units. Paragraphs 134– 137 specify additional disclosure requirements for cash-generating units to which goodwill or intangible assets with indefinite useful lives have been allocated for impairment testing purposes.
(a)
test an intangible asset with an indefinite useful life or an intangible asset not yet available for use for impairment annually by comparing its carrying amount with its recoverable amount. This impairment test may be performed at any time during an annual period, provided it is performed at the same time every year. Different intangible assets may be tested for impairment at different times. However, if such an intangible asset was initially recognised during the current annual period, that intangible asset shall be tested for impairment before the end of the current annual period.
(b)
test goodwill acquired in a business combination for impairment annually in accordance with paragraphs 80– 99 .
(a)
there are observable indications that the asset’s value has declined during the period significantly more than would be expected as a result of the passage of time or normal use.
(b)
significant changes with an adverse effect on the entity have taken place during the period, or will take place in the near future, in the technological, market, economic or legal environment in which the entity operates or in the market to which an asset is dedicated.
(c)
market interest rates or other market rates of return on investments have increased during the period, and those increases are likely to affect the discount rate used in calculating an asset’s value in use and decrease the asset’s recoverable amount materially.
(d)
the carrying amount of the net assets of the entity is more than its market capitalisation.
(e)
evidence is available of obsolescence or physical damage of an asset.
(f)
significant changes with an adverse effect on the entity have taken place during the period, or are expected to take place in the near future, in the extent to which, or manner in which, an asset is used or is expected to be used. These changes include the asset becoming idle, plans to discontinue or restructure the operation to which an asset belongs, plans to dispose of an asset before the previously expected date, and reassessing the useful life of an asset as finite rather than indefinite. 4
(g)
evidence is available from internal reporting that indicates that the economic performance of an asset is, or will be, worse than expected.
(h)
for an investment in a subsidiary, joint venture or associate, the investor recognises a dividend from the investment and evidence is available that:
(i)
the carrying amount of the investment in the separate financial statements exceeds the carrying amounts in the consolidated financial statements of the investee’s net assets, including associated goodwill;
(ii)
the dividend exceeds the total comprehensive income of the subsidiary, joint venture or associate in the period the dividend is declared.
(a)
cash flows for acquiring the asset, or subsequent cash needs for operating or maintaining it, that are significantly higher than those originally budgeted;
(b)
actual net cash flows or operating profit or loss flowing from the asset that are significantly worse than those budgeted;
(c)
a significant decline in budgeted net cash flows or operating profit, or a significant increase in budgeted loss, flowing from the asset; or
(d)
operating losses or net cash outflows for the asset, when current period amounts are aggregated with budgeted amounts for the future.
(a)
if the discount rate used in calculating the asset’s value in use is unlikely to be affected by the increase in these market rates. For example, increases in short-term interest rates may not have a material effect on the discount rate used for an asset that has a long remaining useful life.
(b)
if the discount rate used in calculating the asset’s value in use is likely to be affected by the increase in these market rates but previous sensitivity analysis of recoverable amount shows that:
(i)
it is unlikely that there will be a material decrease in recoverable amount because future cash flows are also likely to increase (eg in some cases, an entity may be able to demonstrate that it adjusts its revenues to compensate for any increase in market rates); or
(ii)
the decrease in recoverable amount is unlikely to result in a material impairment loss.
(a)
the asset’s fair value less costs of disposal is higher than its carrying amount; or
(b)
the asset’s value in use can be estimated to be close to its fair value less costs of disposal and fair value less costs of disposal can be measured.
(a)
if the intangible asset does not generate cash inflows from continuing use that are largely independent of those from other assets or groups of assets and is therefore tested for impairment as part of the cash-generating unit to which it belongs, the assets and liabilities making up that unit have not changed significantly since the most recent recoverable amount calculation;
(b)
the most recent recoverable amount calculation resulted in an amount that exceeded the asset’s carrying amount by a substantial margin; and
(c)
based on an analysis of events that have occurred and circumstances that have changed since the most recent recoverable amount calculation, the likelihood that a current recoverable amount determination would be less than the asset’s carrying amount is remote.
(a)
an estimate of the future cash flows the entity expects to derive from the asset;
(b)
expectations about possible variations in the amount or timing of those future cash flows;
(c)
the time value of money, represented by the current market risk-free rate of interest;
(d)
the price for bearing the uncertainty inherent in the asset; and
(e)
other factors, such as illiquidity, that market participants would reflect in pricing the future cash flows the entity expects to derive from the asset.
(a)
estimating the future cash inflows and outflows to be derived from continuing use of the asset and from its ultimate disposal; and
(b)
applying the appropriate discount rate to those future cash flows.
(a)
base cash flow projections on reasonable and supportable assumptions that represent management’s best estimate of the range of economic conditions that will exist over the remaining useful life of the asset. Greater weight shall be given to external evidence.
(b)
base cash flow projections on the most recent financial budgets/forecasts approved by management, but shall exclude any estimated future cash inflows or outflows expected to arise from future restructurings or from improving or enhancing the asset’s performance. Projections based on these budgets/forecasts shall cover a maximum period of five years, unless a longer period can be justified.
(c)
estimate cash flow projections beyond the period covered by the most recent budgets/forecasts by extrapolating the projections based on the budgets/forecasts using a steady or declining growth rate for subsequent years, unless an increasing rate can be justified. This growth rate shall not exceed the long-term average growth rate for the products, industries, or country or countries in which the entity operates, or for the market in which the asset is used, unless a higher rate can be justified.
(a)
projections of cash inflows from the continuing use of the asset;
(b)
projections of cash outflows that are necessarily incurred to generate the cash inflows from continuing use of the asset (including cash outflows to prepare the asset for use) and can be directly attributed, or allocated on a reasonable and consistent basis, to the asset; and
(c)
net cash flows, if any, to be received (or paid) for the disposal of the asset at the end of its useful life.
(a)
cash inflows from assets that generate cash inflows that are largely independent of the cash inflows from the asset under review (for example, financial assets such as receivables); and
(b)
cash outflows that relate to obligations that have been recognised as liabilities (for example, payables, pensions or provisions).
(a)
a future restructuring to which an entity is not yet committed; or
(b)
improving or enhancing the asset’s performance.
(a)
future cash outflows or related cost savings (for example reductions in staff costs) or benefits that are expected to arise from a future restructuring to which an entity is not yet committed; or
(b)
future cash outflows that will improve or enhance the asset’s performance or the related cash inflows that are expected to arise from such outflows.
(a)
its estimates of future cash inflows and cash outflows for the purpose of determining value in use reflect the cost savings and other benefits from the restructuring (based on the most recent financial budgets/forecasts approved by management); and
(b)
its estimates of future cash outflows for the restructuring are included in a restructuring provision in accordance with Ind AS 37.
(a)
cash inflows or outflows from financing activities; or
(b)
income tax receipts or payments.
(a)
an entity uses prices prevailing at the date of the estimate for similar assets that have reached the end of their useful life and have operated under conditions similar to those in which the asset will be used.
(b)
the entity adjusts those prices for the effect of both future price increases due to general inflation and specific future price increases or decreases. However, if estimates of future cash flows from the asset’s continuing use and the discount rate exclude the effect of general inflation, the entity also excludes this effect from the estimate of net cash flows on disposal.
(a)
additional value derived from the grouping of assets (such as the creation of a portfolio of investment properties in different locations);
(b)
synergies between the asset being measured and other assets;
(c)
legal rights or legal restrictions that are specific only to the current owner of the asset; and
(d)
tax benefits or tax burdens that are specific to the current owner of the asset.
(a)
the time value of money; and
(b)
the risks specific to the asset for which the future cash flow estimates have not been adjusted.
(a)
the asset’s value in use cannot be estimated to be close to its fair value less costs of disposal (for example, when the future cash flows from continuing use of the asset cannot be estimated to be negligible); and
(b)
the asset does not generate cash inflows that are largely independent of those from other assets.
(a)
the future cash inflows used to determine the asset’s or cash-generating unit’s value in use; and
(b)
the future cash outflows used to determine the value in use of any other assets or cash-generating units that are affected by the internal transfer pricing.
(a)
includes the carrying amount of only those assets that can be attributed directly, or allocated on a reasonable and consistent basis, to the cash-generating unit and will generate the future cash inflows used in determining the cash-generating unit's value in use; and
(b)
does not include the carrying amount of any recognised liability, unless the recoverable amount of the cash-generating unit cannot be determined without consideration of this liability.
(a)
represent the lowest level within the entity at which the goodwill is monitored for internal management purposes; and
(b)
not be larger than an operating segment as defined by paragraph 5 of Ind AS 108, Operating Segments, before aggregation.
(a)
accounts for the combination using those provisional values; and
(b)
recognises any adjustments to those provisional values as a result of completing the initial accounting within the measurement period, which will not exceed twelve months from the acquisition date.
(a)
included in the carrying amount of the operation when determining the gain or loss on disposal; and
(b)
measured on the basis of the relative values of the operation disposed of and the portion of the cash-generating unit retained, unless the entity can demonstrate that some other method better reflects the goodwill associated with the operation disposed of.
(a)
the assets and liabilities making up the unit have not changed significantly since the most recent recoverable amount calculation;
(b)
the most recent recoverable amount calculation resulted in an amount that exceeded the carrying amount of the unit by a substantial margin; and
(c)
based on an analysis of events that have occurred and circumstances that have changed since the most recent recoverable amount calculation, the likelihood that a current recoverable amount determination would be less than the current carrying amount of the unit is remote.
(a)
can be allocated on a reasonable and consistent basis to that unit, the entity shall compare the carrying amount of the unit, including the portion of the carrying amount of the corporate asset allocated to the unit, with its recoverable amount. Any impairment loss shall be recognised in accordance with paragraph 104.
(b)
cannot be allocated on a reasonable and consistent basis to that unit, the entity shall:
(i)
compare the carrying amount of the unit, excluding the corporate asset, with its recoverable amount and recognise any impairment loss in accordance with paragraph 104;
(ii)
identify the smallest group of cash-generating units that includes the cash-generating unit under review and to which a portion of the carrying amount of the corporate asset can be allocated on a reasonable and consistent basis; and
(iii)
compare the carrying amount of that group of cash-generating units, including the portion of the carrying amount of the corporate asset allocated to that group of units, with the recoverable amount of the group of units. Any impairment loss shall be recognised in accordance with paragraph 104.
(a)
first, to reduce the carrying amount of any goodwill allocated to the cash-generating unit (group of units); and
(b)
then, to the other assets of the unit (group of units) pro rata on the basis of the carrying amount of each asset in the unit (group of units).
(a)
its fair value less costs of disposal (if measurable);
(b)
its value in use (if determinable); and
(c)
zero.
(a)
an impairment loss is recognised for the asset if its carrying amount is greater than the higher of its fair value less costs of disposal and the results of the allocation procedures described in paragraphs 104 and 105; and
(b)
no impairment loss is recognised for the asset if the related cash-generating unit is not impaired. This applies even if the asset’s fair value less costs of disposal is less than its carrying amount.
(a)
may differ from its fair value less costs of disposal; and
(b)
can be determined only for the cash-generating unit to which the machine belongs (the production line).
(a)
there are observable indications that the asset’s value has increased significantly during the period.
(b)
significant changes with a favourable effect on the entity have taken place during the period, or will take place in the near future, in the technological, market, economic or legal environment in which the entity operates or in the market to which the asset is dedicated.
(c)
market interest rates or other market rates of return on investments have decreased during the period, and those decreases are likely to affect the discount rate used in calculating the asset’s value in use and increase the asset’s recoverable amount materially.
(d)
significant changes with a favourable effect on the entity have taken place during the period, or are expected to take place in the near future, in the extent to which, or manner in which, the asset is used or is expected to be used. These changes include costs incurred during the period to improve or enhance the asset’s performance or restructure the operation to which the asset belongs.
(e)
evidence is available from internal reporting that indicates that the economic performance of the asset is, or will be, better than expected.
(a)
a change in the basis for recoverable amount (ie whether recoverable amount is based on fair value less costs of disposal or value in use);
(b)
if recoverable amount was based on value in use, a change in the amount or timing of estimated future cash flows or in the discount rate; or
(c)
if recoverable amount was based on fair value less costs of disposal, a change in estimate of the components of fair value less costs of disposal.
(a)
its recoverable amount (if determinable); and
(b)
the carrying amount that would have been determined (net of amortisation or depreciation) had no impairment loss been recognised for the asset in prior periods.
(a)
the amount of impairment losses recognised in profit or loss during the period and the line item(s) of the statement of profit and loss in which those impairment losses are included.
(b)
the amount of reversals of impairment losses recognised in profit or loss during the period and the line item(s) of the statement of profit and loss in which those impairment losses are reversed.
(c)
the amount of impairment losses on revalued assets recognised in other comprehensive income during the period.
(d)
the amount of reversals of impairment losses on revalued assets recognised in other comprehensive income during the period.
(a)
the amount of impairment losses recognised in profit or loss and in other comprehensive income during the period.
(b)
the amount of reversals of impairment losses recognised in profit or loss and in other comprehensive income during the period.
(a)
the events and circumstances that led to the recognition or reversal of the impairment loss.
(b)
the amount of the impairment loss recognised or reversed.
(c)
for an individual asset:
(i)
the nature of the asset; and
(ii)
if the entity reports segment information in accordance with Ind AS 108, the reportable segment to which the asset belongs.
(d)
for a cash-generating unit:
(i)
a description of the cash-generating unit (such as whether it is a product line, a plant, a business operation, a geographical area, or a reportable segment as defined in Ind AS 108);
(ii)
the amount of the impairment loss recognised or reversed by class of assets and, if the entity reports segment information in accordance with Ind AS 108, by reportable segment; and
(iii)
if the aggregation of assets for identifying the cash-generating unit has changed since the previous estimate of the cash-generating unit’s recoverable amount (if any), a description of the current and former way of aggregating assets and the reasons for changing the way the cash-generating unit is identified.
(e)
the recoverable amount of the asset (cash-generating unit) and whether the recoverable amount of the asset (cash-generating unit) is its fair value less costs of disposal or its value in use.
(f)
if the recoverable amount is fair value less costs of disposal, the entity shall disclose the following information:
(i)
the level of the fair value hierarchy (see Ind AS 113) within which the fair value measurement of the asset (cash-generating unit) is categorised in its entirety (without taking into account whether the ‘costs of disposal’ are observable);
(ii)
for fair value measurements categorised within Level 2 and Level 3 of the fair value hierarchy, a description of the valuation technique(s) used to measure fair value less costs of disposal. If there has been a change in valuation technique, the entity shall disclose that change and the reason(s) for making it; and
(iii)
for fair value measurements categorised within Level 2 and Level 3 of the fair value hierarchy, each key assumption on which management has based its determination of fair value less costs of disposal. Key assumptions are those to which the asset’s (cash-generating unit’s) recoverable amount is most sensitive. The entity shall also disclose the discount rate(s) used in the current measurement and previous measurement if fair value less costs of disposal is measured using a present value technique.
(g)
if recoverable amount is value in use, the discount rate(s) used in the current estimate and previous estimate (if any) of value in use.
(a)
the main classes of assets affected by impairment losses and the main classes of assets affected by reversals of impairment losses.
(b)
the main events and circumstances that led to the recognition of these impairment losses and reversals of impairment losses.
(a)
the carrying amount of goodwill allocated to the unit (group of units).
(b)
the carrying amount of intangible assets with indefinite useful lives allocated to the unit (group of units).
(c)
the basis on which the unit’s (group of units’) recoverable amount has been determined (ie value in use or fair value less costs of disposal).
(d)
if the unit’s (group of units’) recoverable amount is based on value in use:
(i)
each key assumption on which management has based its cash flow projections for the period covered by the most recent budgets/forecasts. Key assumptions are those to which the unit’s (group of units’) recoverable amount is most sensitive.
(ii)
a description of management’s approach to determining the value(s) assigned to each key assumption, whether those value(s) reflect past experience or, if appropriate, are consistent with external sources of information, and, if not, how and why they differ from past experience or external sources of information.
(iii)
the period over which management has projected cash flows based on financial budgets/forecasts approved by management and, when a period greater than five years is used for a cash-generating unit (group of units), an explanation of why that longer period is justified.
(iv)
the growth rate used to extrapolate cash flow projections beyond the period covered by the most recent budgets/forecasts, and the justification for using any growth rate that exceeds the long-term average growth rate for the products, industries, or country or countries in which the entity operates, or for the market to which the unit (group of units) is dedicated.
(v)
the discount rate(s) applied to the cash flow projections.
(e)
if the unit’s (group of units’) recoverable amount is based on fair value less costs of disposal, the valuation technique(s) used to measure fair value less costs of disposal. An entity is not required to provide the disclosures required by Ind AS 113 . If fair value less costs of disposal is not measured using a quoted price for an identical unit (group of units), an entity shall disclose the following information:
(i)
each key assumption on which management has based its determination of fair value less costs of disposal. Key assumptions are those to which the unit’s (group of units’) recoverable amount is most sensitive.
(ii)
a description of management’s approach to determining the value (or values) assigned to each key assumption, whether those values reflect past experience or, if appropriate, are consistent with external sources of information, and, if not, how and why they differ from past experience or external sources of information.
(iia)
the level of the fair value hierarchy (see Ind AS 113 within which the fair value measurement is categorised in its entirety (without giving regard to the observability of 'costs of disposal').
(iib)
if there has been a change in valuation technique, the change and the reason(s) for making it.
(iii)
the period over which management has projected cash flows.
(iv)
the growth rate used to extrapolate cash flow projections.
(v)
the discount rate(s) applied to the cash flow projections.
(f)
if a reasonably possible change in a key assumption on which management has based its determination of the unit’s (group of units’) recoverable amount would cause the unit’s (group of units’) carrying amount to exceed its recoverable amount:
(i)
the amount by which the unit’s (group of units’) recoverable amount exceeds its carrying amount.
(ii)
the value assigned to the key assumption.
(iii)
the amount by which the value assigned to the key assumption must change, after incorporating any consequential effects of that change on the other variables used to measure recoverable amount, in order for the unit’s (group of units’) recoverable amount to be equal to its carrying amount.
(a)
the aggregate carrying amount of goodwill allocated to those units (groups of units).
(b)
the aggregate carrying amount of intangible assets with indefinite useful lives allocated to those units (groups of units).
(c)
a description of the key assumption(s).
(d)
a description of management’s approach to determining the value(s) assigned to the key assumption(s), whether those value(s) reflect past experience or, if appropriate, are consistent with external sources of information, and, if not, how and why they differ from past experience or external sources of information.
(e)
if a reasonably possible change in the key assumption(s) would cause the aggregate of the units’ (groups of units’) carrying amounts to exceed the aggregate of their recoverable amounts:
(i)
the amount by which the aggregate of the units’ (groups of units’) recoverable amounts exceeds the aggregate of their carrying amounts.
(ii)
the value(s) assigned to the key assumption(s).
(iii)
the amount by which the value(s) assigned to the key assumption(s) must change, after incorporating any consequential effects of the change on the other variables used to measure recoverable amount, in order for the aggregate of the units’ (groups of units’) recoverable amounts to be equal to the aggregate of their carrying amounts.
(a)
an estimate of the future cash flow, or in more complex cases, series of future cash flows the entity expects to derive from the asset;
(b)
expectations about possible variations in the amount or timing of those cash flows;
(c)
the time value of money, represented by the current market risk-free rate of interest;
(d)
the price for bearing the uncertainty inherent in the asset; and
(e)
other, sometimes unidentifiable, factors (such as illiquidity) that market participants would reflect in pricing the future cash flows the entity expects to derive from the asset.
(a)
interest rates used to discount cash flows should reflect assumptions that are consistent with those inherent in the estimated cash flows. Otherwise, the effect of some assumptions will be double-counted or ignored. For example, a discount rate of 12 per cent might be applied to contractual cash flows of a loan receivable. That rate reflects expectations about future defaults from loans with particular characteristics. That same 12 per cent rate should not be used to discount expected cash flows because those cash flows already reflect assumptions about future defaults.
(b)
estimated cash flows and discount rates should be free from both bias and factors unrelated to the asset in question. For example, deliberately understating estimated net cash flows to enhance the apparent future profitability of an asset introduces a bias into the measurement.
(c)
estimated cash flows or discount rates should reflect the range of possible outcomes rather than a single most likely, minimum or maximum possible amount.
(a)
identify the set of cash flows that will be discounted;
(b)
identify another asset in the marketplace that appears to have similar cash flow characteristics;
(c)
compare the cash flow sets from the two items to ensure that they are similar (for example, are both sets contractual cash flows, or is one contractual and the other an estimated cash flow?);
(d)
evaluate whether there is an element in one item that is not present in the other (for example, is one less liquid than the other?); and
(e)
evaluate whether both sets of cash flows are likely to behave (ie vary) in a similar fashion in changing economic conditions.
(a)
the estimated amount falls somewhere between Rs. 50 and Rs. 250, but no amount in the range is more likely than any other amount. Based on that limited information, the estimated expected cash flow is Rs. 150 [(50 + 250)/2].
(b)
the estimated amount falls somewhere between Rs. 50 and Rs. 250, and the most likely amount is Rs. 100. However, the probabilities attached to each amount are unknown. Based on that limited information, the estimated expected cash flow is Rs. 133.33 [(50 + 100 + 250)/3].
(c)
the estimated amount will be Rs. 50 (10 per cent probability), Rs. 250 (30 per cent probability), or Rs. 100 (60 per cent probability). Based on that limited information, the estimated expected cash flow is Rs. 140 [(50 × 0.10) + (250 × 0.30) + (100x 0.60)].
(a)
the time value of money for the periods until the end of the asset’s useful life; and
(b)
factors (b), (d) and (e) described in paragraph A1, to the extent those factors have not caused adjustments in arriving at estimated cash flows.
(a)
the entity’s weighted average cost of capital determined using techniques such as the Capital Asset Pricing Model;
(b)
the entity’s incremental borrowing rate; and
(c)
other market borrowing rates.
(a)
to reflect the way that the market would assess the specific risks associated with the asset’s estimated cash flows; and
(b)
to exclude risks that are not relevant to the asset’s estimated cash flows or for which the estimated cash flows have been adjusted.
(a)
the aggregate of:
(i)
the consideration transferred measured in accordance with Ind AS 103, which generally requires acquisition-date fair value;
(ii)
the amount of any non-controlling interest in the acquiree measured in accordance with Ind AS 103; and
(iii)
in a business combination achieved in stages, the acquisition-date fair value of the acquirer’s previously held equity interest in the acquiree.
(b)
the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed measured in accordance with Ind AS 103.
(a)
to the extent that the impairment relates to goodwill in the cash-generating unit, the relative carrying values of the goodwill of the parts before the impairment; and
(b)
to the extent that the impairment relates to identifiable assets in the cash-generating unit, the relative carrying values of the net identifiable assets of the parts before the impairment. Any such impairment is allocated to the assets of the parts of each unit pro rata on the basis of the carrying amount of each asset in the part.
(i)
Paragraph 5(b)
(ii)
Paragraphs 25-27
(i)
Reference to Example 5 of Illustrative Examples in paragraph 47 illustrating effects of a future restructuring on a value in use calculation
(ii)
Reference to Example 6 of Illustrative Examples in paragraph 48
(iii)
Reference to Example 3 of Illustrative Examples in paragraph 64
(iv)
Reference to Example 1 of Illustrative Examples in paragraph 69 giving examples of identification of a cash generating unit
(i)
paragraph 103 making reference to Example 8 of Illustrative Examples illustrating the application of requirements given regarding corporate assets
(ii)
paragraph 137 making reference to Example 9 of Illustrative Examples illustrating the disclosures required by paragraphs 134 and 135
(iii)
paragraph C9 of Appendix C making reference to Example 7 of Illustrative Examples illustrating the impairment testing of a non- wholly-owned cash-generating unit with goodwill
Notes, amendments & references (9)
# This Ind AS was notified vide G.S.R. 111(E) dated 16t h February, 2015 and was amended vide Notification No. G.S.R. 365(E) dated 30 th March, 2016, G.S.R. 310(E) dated 28 t h March, 2018 and G.S.R. 492(E) dated 12th August, 2024.
1 Substituted vide Notification No. G.S.R. 365(E) dated 30t h March, 2016 and, thereafter, substituted vide Notification No. G.S.R. 310(E) dated 28 th March, 2018.
2 Substituted vide Notification No. G.S.R. 492(E) dated 12th August, 2024.
3 In the case of an intangible asset, the term 'amortisation' is generally used instead of 'depreciation'. The two terms have the same meaning.
4 Once an asset meets the criteria to be classified as held for sale (or is included in a disposal group that is classified as held for sale), it is excluded from the scope of this Standard and is accounted for in accordance with Ind AS 105, Non-current Assets Held for Sale and Discontinued Operations .
5 Heading and paragraphs 138-140L inserted vide Notification No. G.S.R. 310(E) dated 28t h March, 2018.
* Refer Appendix 1
6 Paragraphs 140M-140N inserted vide Notification No. G.S.R. 492(E) dated 12th August, 2024.
7 Inserted vide Notification No. G.S.R. 310(E) dated 28th March, 2018 and, thereafter, substituted vide Notification No. G.S.R. 492(E) dated 12th August, 2024.