CERTYNEX IFRS ACADEMY

The value in use projections of Agrifrais's Packaging CGU include the output of a labelling machine used exclusively by that unit. However, the labelling machine is recorded in the head office's accounts, and the controller left it out of the carrying amount of the CGU. What should be done?

Nothing: the labelling machine is recorded at head office and therefore stays outside the Packaging CGU.

Include the labelling machine in the carrying amount of the CGU, since it generates cash flows used in its value in use.

Remove the labelling cash flows from value in use, so as to leave the machine at head office without changing the unit's carrying amount.

Include half of the labelling machine's carrying amount, out of prudence.