IAS 36Chapter 1Lesson 1
Why impair? Objective and scope of IAS 36
Step 1 of 10Learning objectives
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Welcome to IAS 36. This first lesson explains why impairment exists: an asset must never be carried on the balance sheet at more than its use or sale will allow the entity to recover. It then sets out which assets the standard covers and which ones have their impairment governed by another standard.
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Learning objectives
- Explain in one sentence the objective of IAS 36 and the economic logic of impairment.
- Distinguish depreciation (allocating a cost) from impairment (checking what is recoverable).
- Identify whether an asset falls under IAS 36 or another standard, including investments in subsidiaries, associates and joint ventures.
- Explain how IAS 36 works together with an asset measured under the revaluation model.