CERTYNEX IFRS ACADEMY

To estimate the recoverable amount of a cold-storage warehouse, Brémond's finance team uses the average operating costs of the last three years and a simplified model, rather than a detailed line-by-line projection. The differences found against a detailed projection prepared last year were minimal. The auditor asks whether this approach is acceptable.

No: only detailed projections, prepared year by year and line by line without any simplification, are allowed by the standard.

Yes, provided these estimates, averages and shortcuts give a reasonable approximation.

Yes, unconditionally, as long as the method is applied consistently.

No: using averages requires fair value less costs of disposal to be used as the only measure.