CERTYNEX IFRS ACADEMY

Loire Froid impaired a cold-storage warehouse in 20X1 based on its value in use. At the end of 20X2, an internal auditor reviews the closing file. Which step is wrong?

Step 1: the recoverable amount is now based on fair value less costs of disposal, which has become higher than value in use.

Step 2: the change of basis is deemed irrelevant and any reversal is refused, as cash flows have not been revised.

Step 3: it is checked that the increase in recoverable amount does not arise solely from the unwinding of the discount.

No step is wrong.