Goodwill: no reversal of an interim loss

Learning objectives

• Explain that an impairment loss on goodwill recognised in an interim period is not reversed in a subsequent interim or annual period, even if cumulative measurement would suggest a smaller loss, because the prohibition on reversal in IAS 36 prevails.L2, L3
• Calculate the carrying amount of goodwill after an interim impairment loss and a subsequent improvement in conditions, without reversal.L2, L3

Normative references

The syntheses of the reference register are written in French: only the paragraph reference is shown here.

2 questions

• At the beginning of the year, the goodwill of Tavira SA's North cash-generating unit has a carrying amount of {opening_goodwill}. At 30 June, an impairment loss of {impairment_loss} is recognised on that goodwill. At 30 September, the recoverable amount of the unit exceeds its carrying amount (case data) and the draft report shows goodwill of {reported_closing}, the loss having been "cancelled". No other movement (case assumption). Calculate the carrying amount of goodwill at 30 September with no reversal of the loss, then the difference with the draft (draft less recalculated amount).L3
• At 30 June 20X5, Tavira SA recognised an impairment loss on the goodwill of the North cash-generating unit. At 30 September 20X5, the recoverable amount of that unit exceeds its carrying amount (case data). A preparer considers that, since measurement is year-to-date, the 30 June loss may be cancelled in the third quarter. What treatment is appropriate?L2