CERTYNEX IFRS ACADEMY

Lumen has allocated significant goodwill of 900,000 to its Vision cash-generating unit. In the 20X3 test, value in use exceeds the unit's carrying amount by only 4%. Management considers reasonably possible a 1 point increase in the discount rate, which would make the carrying amount exceed the recoverable amount. No loss is recognised. What should be done regarding disclosures?

Add nothing: as no loss is recognised, the sensitivity of the recoverable amount need not be discussed.

In addition to the other information on the unit, disclose a sensitivity analysis on the discount rate, since a reasonably possible change in this key assumption would give rise to a loss.

Treat the sensitivity analysis as merely encouraged, like the assumptions for units without goodwill.

Recognise, out of prudence, an impairment loss equal to the 4% headroom, which removes the need for a sensitivity analysis.