CERTYNEX IFRS ACADEMY

Ostrale operates a patented manufacturing process that relies entirely on the know-how of a small team of engineers. In November 20X1, the whole team leaves to join a competitor and no replacement is feasible in the short term. The finance director argues that this situation does not appear as such in the standard's list of indications. Which position should be taken?

There is no indication, because the situation is not in the standard's list.

The entity must estimate the recoverable amount of the assets concerned, since the list of indications is not exhaustive.

The entity waits for the 20X2 results to see the effect of the departure before any analysis.

The entity immediately recognises an impairment loss equal to the entire carrying amount of the patented process, without further analysis.