Workpapers

Workpaper template

WorkpaperIFRS 5 — Non-current Assets Held for Sale and Discontinued OperationsL1 · L2 · L3 · L4

Held-for-sale measurement file: lower of, loss, reversal, disposal and ceasing the classification

4 missions10 sections to document70 min

Prepared by: AI-assisted draft
Reviewed by: Not reviewed — human review required
Status: Published

Objective of the workpaper

For each asset (one instance per asset), enter the cost, residual value and useful life, the carrying amount immediately before classification (after the last depreciation charge), the fair value and the table of costs to sell. The file computes the last depreciation charge, the total costs to sell, fair value less costs to sell, the amount measured at the lower of the two, the loss and, depending on the situation, the reversal capped at the cumulative loss, the result of the disposal and the measurement on ceasing the classification. Fair value is a datum of the file; financing charges and income tax are not costs to sell. Then prepare the entries. The last charge is the full annual charge: the file assumes classification at the reporting date; for a classification during the year, enter the carrying amount after the charge prorated for the period elapsed. The measurement on ceasing the classification reflects only the missed depreciation; any loss down to the recoverable amount is recognised separately.

10 sections · 40 blocks · 10 calculations · 7 entries

IFRS 5 §15
IFRS 5 §18
IFRS 5 §20
IFRS 5 §21
IFRS 5 §22
IFRS 5 §24
IFRS 5 §25
IFRS 5 §27
IFRS 5 §28
IFRS 5

Work this workpaper as a mission

Each case that uses this template opens in the mission workspace: data, analysis, calculation, entries, conclusion and review, with your progress saved.

4 instances from the cases: the calculations and entries below are run by the calculation engine.

File and entity

Lower-of measurement: last depreciation charge, costs to sell and impairment loss

Case tasks documented here

Compute the last depreciation charge and the carrying amount at the classification date.
Add up the costs to sell.
Compute fair value less costs to sell.
Determine the amount measured (lower of the two bases).
Compute the impairment loss.
Record the depreciation, the reclassification and the loss.

Inputs

Asset: nature, classification date and basis of the carrying amount
Text
LIGNE_DE_CONDITIONNEMENT_CLASSEE_AU_31_DECEMBRE_20X5
Cost of the asset
Number
600,000
Residual value
Number
0
Useful life (in years)
Number
10 years
Carrying amount immediately before classification (after the last depreciation charge)
Number
300,000
Fair value of the asset (datum of the file)
Number
285,000
Costs to sell (nature, amount)
Table
COMMISSION · 6,000 | FRAIS_JURIDIQUES · 3,000 | TRANSPORT_VERS_L_ACHETEUR · 6,000
Cumulative loss recognised previously
Number
Increase in fair value less costs to sell
Number
Selling price
Number
Costs to sell incurred
Number
Carrying amount derecognised
Number
Net cash received (price less costs to sell)
Number
Depreciation not recognised during the classification
Number
Recoverable amount at the date of the decision not to sell (datum of the file)
Number

Supporting evidence

Evidence

Evidence obtained and referenced (category, document reference)
EvidenceRequired

Analysis of the measurement

Analysis

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Points reviewed: prior remeasurement, last charge, costs, lower of, loss, reversal, disposal, ceasing
ChecklistRequired
- Carrying amount updated under the applicable standard before classification
- Last depreciation charge booked up to classification, none afterwards
- Costs to sell identified, finance costs and income tax excluded
- Lower of carrying amount and fair value less costs to sell applied
- Loss recognised in profit or loss
- Reversal capped at the cumulative loss
- Gain or loss not yet recognised taken at the date of sale
- Measurement on ceasing the classification and adjustment presented in profit or loss

Calculations

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Straight-line annual charge (last full charge, classification at the reporting date)
Calculation
60,000
Cost of the asset ; Residual value ; Useful life (in years)
Total costs to sell
Calculation
15,000
Costs to sell (nature, amount)
Fair value less costs to sell
Calculation
270,000
Fair value of the asset (datum of the file) ; − Total costs to sell
Amount measured at the lower of
Calculation
270,000
Carrying amount immediately before classification (after the last depreciation charge) ; Fair value less costs to sell
Impairment loss to recognise
Calculation
30,000
Carrying amount immediately before classification (after the last depreciation charge) ; − Amount measured at the lower of
Reversal gain capped at the cumulative loss
Calculation
Increase in fair value less costs to sell ; Cumulative loss recognised previously
Gain on disposal
Calculation
0
Selling price ; − Costs to sell incurred ; − Carrying amount derecognised
Loss on disposal
Calculation
0
Selling price ; − Costs to sell incurred ; − Carrying amount derecognised
Carrying amount before classification adjusted for missed depreciation
Calculation
300,000
Carrying amount immediately before classification (after the last depreciation charge) ; − Depreciation not recognised during the classification
Amount measured on ceasing the classification (lower of the adjusted amount and the recoverable amount)
Calculation
Carrying amount before classification adjusted for missed depreciation ; Recoverable amount at the date of the decision not to sell (datum of the file)

Journal entries

Entries

Last depreciation charge up to the classification date
Entry
Account Debit Credit
Depreciation expense 60,000
Accumulated depreciation 60,000
Reclassification to assets held for sale
Entry
Account Debit Credit
Asset held for sale 300,000
Property, plant and equipment (net amount) 300,000
Loss down to fair value less costs to sell
Entry
Account Debit Credit
Impairment loss 30,000
Asset held for sale 30,000
Capped reversal gain
Entry
Debit Asset held for sale ← Reversal gain capped at the cumulative loss ; Credit Impairment reversal gain ← Reversal gain capped at the cumulative loss
Disposal with a gain
Entry
Debit Cash ← Net cash received (price less costs to sell) ; Credit Asset held for sale ← Carrying amount derecognised ; Credit Gain on disposal ← Gain on disposal
Disposal with a loss
Entry
Debit Cash ← Net cash received (price less costs to sell) ; Debit Loss on disposal ← Loss on disposal ; Credit Asset held for sale ← Carrying amount derecognised
Missed depreciation on ceasing the classification (excluding any loss down to the recoverable amount)
Entry
Debit Depreciation expense ← Depreciation not recognised during the classification ; Credit Accumulated depreciation ← Depreciation not recognised during the classification

Account	Debit	Credit
Depreciation expense	60,000
Accumulated depreciation		60,000

Account	Debit	Credit
Asset held for sale	300,000
Property, plant and equipment (net amount)		300,000

Account	Debit	Credit
Impairment loss	30,000
Asset held for sale		30,000

Judgements

Judgment

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Fair value retained
JudgmentRequired
Fair value supported by a valuation
Fair value supported by a valuation / Fair value to review before concluding
Rule and cross-reference: an asset held for sale is measured at the lower of its carrying amount and its fair value less costs to sell (IFRS 5, para. 15); costs to sell are the incremental costs directly attributable to the disposal, excluding finance costs and income tax (IFRS 5, Appendix A). The fair value retained is a datum of the file and a documented judgement.
Rationale: source of the fair value, date, assumptions, alternative rejected
TextRequired
EXPERTISE_INDEPENDANTE_A_LA_DATE_DE_CLASSEMENT

Conclusion

Amount measured, loss or reversal and result submitted to the reviewer
ConclusionRequired

Effect on the financial statements

FS impact

Effect of the entries, line by line (derived from the entries)
Table

Disclosures

Disclosure

IFRS 5 §15IFRS 5 §20IFRS 5 §21IFRS 5 §28

Disclosures: losses, reversals, measurement basis, adjustment on ceasing
ChecklistRequired
- Losses and reversals stated
- Measurement basis stated
- Ceasing adjustment presented in profit or loss from continuing operations

Normative references

References

Paragraphs cited in this workpaper and their verification status
References

Checks and financial statement impact

Judgement on fair value documentedPass
Last depreciation entry balancedPass
Reclassification entry balancedPass
Loss entry balancedPass
Reversal entry balancedNot evaluated
Disposal entry with a gain balancedNot evaluated
Disposal entry with a loss balancedNot evaluated
Ceasing entry balancedNot evaluated

Assets: -90,000
Liabilities: 0
Profit or loss: -90,000
OCI: 0
Equity: -90,000

File and entity

Change of plan: return to use, missed depreciation and abandonment

Case tasks documented here

Compute the depreciation not recognised during the classification.
Compute the adjusted carrying amount before classification.
Compute the amount measured on ceasing the classification.
Record the return to use, the adjustment and any loss.

Inputs

Asset: nature, classification date and basis of the carrying amount
Text
MACHINE_M1_SORTIE_DU_CLASSEMENT_LE_31_DECEMBRE_20X6
Cost of the asset
Number
600,000
Residual value
Number
0
Useful life (in years)
Number
10 years
Carrying amount immediately before classification (after the last depreciation charge)
Number
300,000
Fair value of the asset (datum of the file)
Number
Costs to sell (nature, amount)
Table
Cumulative loss recognised previously
Number
Increase in fair value less costs to sell
Number
Selling price
Number
Costs to sell incurred
Number
Carrying amount derecognised
Number
Net cash received (price less costs to sell)
Number
Depreciation not recognised during the classification
Number
60,000
Recoverable amount at the date of the decision not to sell (datum of the file)
Number
225,000

Supporting evidence

Evidence

Evidence obtained and referenced (category, document reference)
EvidenceRequired

Analysis of the measurement

Analysis

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Points reviewed: prior remeasurement, last charge, costs, lower of, loss, reversal, disposal, ceasing
ChecklistRequired
- Carrying amount updated under the applicable standard before classification
- Last depreciation charge booked up to classification, none afterwards
- Costs to sell identified, finance costs and income tax excluded
- Lower of carrying amount and fair value less costs to sell applied
- Loss recognised in profit or loss
- Reversal capped at the cumulative loss
- Gain or loss not yet recognised taken at the date of sale
- Measurement on ceasing the classification and adjustment presented in profit or loss

Calculations

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Straight-line annual charge (last full charge, classification at the reporting date)
Calculation
60,000
Cost of the asset ; Residual value ; Useful life (in years)
Total costs to sell
Calculation
0
Costs to sell (nature, amount)
Fair value less costs to sell
Calculation
0
Fair value of the asset (datum of the file) ; − Total costs to sell
Amount measured at the lower of
Calculation
0
Carrying amount immediately before classification (after the last depreciation charge) ; Fair value less costs to sell
Impairment loss to recognise
Calculation
300,000
Carrying amount immediately before classification (after the last depreciation charge) ; − Amount measured at the lower of
Reversal gain capped at the cumulative loss
Calculation
Increase in fair value less costs to sell ; Cumulative loss recognised previously
Gain on disposal
Calculation
0
Selling price ; − Costs to sell incurred ; − Carrying amount derecognised
Loss on disposal
Calculation
0
Selling price ; − Costs to sell incurred ; − Carrying amount derecognised
Carrying amount before classification adjusted for missed depreciation
Calculation
240,000
Carrying amount immediately before classification (after the last depreciation charge) ; − Depreciation not recognised during the classification
Amount measured on ceasing the classification (lower of the adjusted amount and the recoverable amount)
Calculation
225,000
Carrying amount before classification adjusted for missed depreciation ; Recoverable amount at the date of the decision not to sell (datum of the file)

Journal entries

Entries

Last depreciation charge up to the classification date
Entry
Account Debit Credit
Depreciation expense 60,000
Accumulated depreciation 60,000
Reclassification to assets held for sale
Entry
Account Debit Credit
Asset held for sale 300,000
Property, plant and equipment (net amount) 300,000
Loss down to fair value less costs to sell
Entry
Account Debit Credit
Impairment loss 300,000
Asset held for sale 300,000
Capped reversal gain
Entry
Debit Asset held for sale ← Reversal gain capped at the cumulative loss ; Credit Impairment reversal gain ← Reversal gain capped at the cumulative loss
Disposal with a gain
Entry
Debit Cash ← Net cash received (price less costs to sell) ; Credit Asset held for sale ← Carrying amount derecognised ; Credit Gain on disposal ← Gain on disposal
Disposal with a loss
Entry
Debit Cash ← Net cash received (price less costs to sell) ; Debit Loss on disposal ← Loss on disposal ; Credit Asset held for sale ← Carrying amount derecognised
Missed depreciation on ceasing the classification (excluding any loss down to the recoverable amount)
Entry
Account Debit Credit
Depreciation expense 60,000
Accumulated depreciation 60,000

Account	Debit	Credit
Depreciation expense	60,000
Accumulated depreciation		60,000

Account	Debit	Credit
Asset held for sale	300,000
Property, plant and equipment (net amount)		300,000

Account	Debit	Credit
Impairment loss	300,000
Asset held for sale		300,000

Account	Debit	Credit
Depreciation expense	60,000
Accumulated depreciation		60,000

Judgements

Judgment

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Fair value retained
JudgmentRequired
Fair value supported by a valuation / Fair value to review before concluding
Rule and cross-reference: an asset held for sale is measured at the lower of its carrying amount and its fair value less costs to sell (IFRS 5, para. 15); costs to sell are the incremental costs directly attributable to the disposal, excluding finance costs and income tax (IFRS 5, Appendix A). The fair value retained is a datum of the file and a documented judgement.
Rationale: source of the fair value, date, assumptions, alternative rejected
TextRequired

Conclusion

Amount measured, loss or reversal and result submitted to the reviewer
ConclusionRequired

Effect on the financial statements

FS impact

Effect of the entries, line by line (derived from the entries)
Table

Disclosures

Disclosure

IFRS 5 §15IFRS 5 §20IFRS 5 §21IFRS 5 §28

Disclosures: losses, reversals, measurement basis, adjustment on ceasing
ChecklistRequired
- Losses and reversals stated
- Measurement basis stated
- Ceasing adjustment presented in profit or loss from continuing operations

Normative references

References

Paragraphs cited in this workpaper and their verification status
References

Checks and financial statement impact

Judgement on fair value documentedNot filled in this instance
Last depreciation entry balancedPass
Reclassification entry balancedPass
Loss entry balancedPass
Reversal entry balancedNot evaluated
Disposal entry with a gain balancedNot evaluated
Disposal entry with a loss balancedNot evaluated
Ceasing entry balancedPass

Assets: -420,000
Liabilities: 0
Profit or loss: -420,000
OCI: 0
Equity: -420,000

File and entity

File of a disposal project: classification, measurement of a group, discontinued operation and presentation

Case tasks documented here

Add up the costs to sell.
Compute fair value less costs to sell.
Determine the amount measured for the group (lower of the two bases).
Compute the annual depreciation of line Y.
Compute the adjusted carrying amount of Y.
Compute the amount measured for Y on ceasing the classification.
Record the 20X6 transactions.

Inputs

Asset: nature, classification date and basis of the carrying amount
Text
DIVISION_EAUX_MESUREE_COMME_UN_GROUPE
Cost of the asset
Number
Residual value
Number
Useful life (in years)
Number
Carrying amount immediately before classification (after the last depreciation charge)
Number
560,000
Fair value of the asset (datum of the file)
Number
518,000
Costs to sell (nature, amount)
Table
COMMISSION · 12,000 | FRAIS_JURIDIQUES · 8,000
Cumulative loss recognised previously
Number
Increase in fair value less costs to sell
Number
Selling price
Number
Costs to sell incurred
Number
Carrying amount derecognised
Number
Net cash received (price less costs to sell)
Number
Depreciation not recognised during the classification
Number
Recoverable amount at the date of the decision not to sell (datum of the file)
Number

Supporting evidence

Evidence

Evidence obtained and referenced (category, document reference)
EvidenceRequired

Analysis of the measurement

Analysis

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Points reviewed: prior remeasurement, last charge, costs, lower of, loss, reversal, disposal, ceasing
ChecklistRequired
- Carrying amount updated under the applicable standard before classification
- Last depreciation charge booked up to classification, none afterwards
- Costs to sell identified, finance costs and income tax excluded
- Lower of carrying amount and fair value less costs to sell applied
- Loss recognised in profit or loss
- Reversal capped at the cumulative loss
- Gain or loss not yet recognised taken at the date of sale
- Measurement on ceasing the classification and adjustment presented in profit or loss

Calculations

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Straight-line annual charge (last full charge, classification at the reporting date)
Calculation
Cost of the asset ; Residual value ; Useful life (in years)
Total costs to sell
Calculation
20,000
Costs to sell (nature, amount)
Fair value less costs to sell
Calculation
498,000
Fair value of the asset (datum of the file) ; − Total costs to sell
Amount measured at the lower of
Calculation
498,000
Carrying amount immediately before classification (after the last depreciation charge) ; Fair value less costs to sell
Impairment loss to recognise
Calculation
62,000
Carrying amount immediately before classification (after the last depreciation charge) ; − Amount measured at the lower of
Reversal gain capped at the cumulative loss
Calculation
Increase in fair value less costs to sell ; Cumulative loss recognised previously
Gain on disposal
Calculation
0
Selling price ; − Costs to sell incurred ; − Carrying amount derecognised
Loss on disposal
Calculation
0
Selling price ; − Costs to sell incurred ; − Carrying amount derecognised
Carrying amount before classification adjusted for missed depreciation
Calculation
560,000
Carrying amount immediately before classification (after the last depreciation charge) ; − Depreciation not recognised during the classification
Amount measured on ceasing the classification (lower of the adjusted amount and the recoverable amount)
Calculation
Carrying amount before classification adjusted for missed depreciation ; Recoverable amount at the date of the decision not to sell (datum of the file)

Journal entries

Entries

Last depreciation charge up to the classification date
Entry
Debit Depreciation expense ← Straight-line annual charge (last full charge, classification at the reporting date) ; Credit Accumulated depreciation ← Straight-line annual charge (last full charge, classification at the reporting date)
Reclassification to assets held for sale
Entry
Account Debit Credit
Asset held for sale 560,000
Property, plant and equipment (net amount) 560,000
Loss down to fair value less costs to sell
Entry
Account Debit Credit
Impairment loss 62,000
Asset held for sale 62,000
Capped reversal gain
Entry
Debit Asset held for sale ← Reversal gain capped at the cumulative loss ; Credit Impairment reversal gain ← Reversal gain capped at the cumulative loss
Disposal with a gain
Entry
Debit Cash ← Net cash received (price less costs to sell) ; Credit Asset held for sale ← Carrying amount derecognised ; Credit Gain on disposal ← Gain on disposal
Disposal with a loss
Entry
Debit Cash ← Net cash received (price less costs to sell) ; Debit Loss on disposal ← Loss on disposal ; Credit Asset held for sale ← Carrying amount derecognised
Missed depreciation on ceasing the classification (excluding any loss down to the recoverable amount)
Entry
Debit Depreciation expense ← Depreciation not recognised during the classification ; Credit Accumulated depreciation ← Depreciation not recognised during the classification

Account	Debit	Credit
Asset held for sale	560,000
Property, plant and equipment (net amount)		560,000

Account	Debit	Credit
Impairment loss	62,000
Asset held for sale		62,000

Judgements

Judgment

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Fair value retained
JudgmentRequired
Fair value supported by a valuation
Fair value supported by a valuation / Fair value to review before concluding
Rule and cross-reference: an asset held for sale is measured at the lower of its carrying amount and its fair value less costs to sell (IFRS 5, para. 15); costs to sell are the incremental costs directly attributable to the disposal, excluding finance costs and income tax (IFRS 5, Appendix A). The fair value retained is a datum of the file and a documented judgement.
Rationale: source of the fair value, date, assumptions, alternative rejected
TextRequired
EXPERTISE_SUR_LA_DIVISION_ENTIERE

Conclusion

Amount measured, loss or reversal and result submitted to the reviewer
ConclusionRequired

Effect on the financial statements

FS impact

Effect of the entries, line by line (derived from the entries)
Table

Disclosures

Disclosure

IFRS 5 §15IFRS 5 §20IFRS 5 §21IFRS 5 §28

Disclosures: losses, reversals, measurement basis, adjustment on ceasing
ChecklistRequired
- Losses and reversals stated
- Measurement basis stated
- Ceasing adjustment presented in profit or loss from continuing operations

Normative references

References

Paragraphs cited in this workpaper and their verification status
References

Checks and financial statement impact

Judgement on fair value documentedPass
Last depreciation entry balancedNot evaluated
Reclassification entry balancedPass
Loss entry balancedPass
Reversal entry balancedNot evaluated
Disposal entry with a gain balancedNot evaluated
Disposal entry with a loss balancedNot evaluated
Ceasing entry balancedNot evaluated

Assets: -62,000
Liabilities: 0
Profit or loss: -62,000
OCI: 0
Equity: -62,000

File and entity

File of a disposal project: classification, measurement of a group, discontinued operation and presentation

Case tasks documented here

Add up the costs to sell.
Compute fair value less costs to sell.
Determine the amount measured for the group (lower of the two bases).
Compute the annual depreciation of line Y.
Compute the adjusted carrying amount of Y.
Compute the amount measured for Y on ceasing the classification.
Record the 20X6 transactions.

Inputs

Asset: nature, classification date and basis of the carrying amount
Text
CHAINE_DE_REMPLISSAGE_Y_SORTIE_DU_CLASSEMENT
Cost of the asset
Number
240,000
Residual value
Number
0
Useful life (in years)
Number
8 years
Carrying amount immediately before classification (after the last depreciation charge)
Number
150,000
Fair value of the asset (datum of the file)
Number
Costs to sell (nature, amount)
Table
Cumulative loss recognised previously
Number
Increase in fair value less costs to sell
Number
Selling price
Number
Costs to sell incurred
Number
Carrying amount derecognised
Number
Net cash received (price less costs to sell)
Number
Depreciation not recognised during the classification
Number
30,000
Recoverable amount at the date of the decision not to sell (datum of the file)
Number
130,000

Supporting evidence

Evidence

Evidence obtained and referenced (category, document reference)
EvidenceRequired

Analysis of the measurement

Analysis

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Points reviewed: prior remeasurement, last charge, costs, lower of, loss, reversal, disposal, ceasing
ChecklistRequired
- Carrying amount updated under the applicable standard before classification
- Last depreciation charge booked up to classification, none afterwards
- Costs to sell identified, finance costs and income tax excluded
- Lower of carrying amount and fair value less costs to sell applied
- Loss recognised in profit or loss
- Reversal capped at the cumulative loss
- Gain or loss not yet recognised taken at the date of sale
- Measurement on ceasing the classification and adjustment presented in profit or loss

Calculations

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Straight-line annual charge (last full charge, classification at the reporting date)
Calculation
30,000
Cost of the asset ; Residual value ; Useful life (in years)
Total costs to sell
Calculation
0
Costs to sell (nature, amount)
Fair value less costs to sell
Calculation
0
Fair value of the asset (datum of the file) ; − Total costs to sell
Amount measured at the lower of
Calculation
0
Carrying amount immediately before classification (after the last depreciation charge) ; Fair value less costs to sell
Impairment loss to recognise
Calculation
150,000
Carrying amount immediately before classification (after the last depreciation charge) ; − Amount measured at the lower of
Reversal gain capped at the cumulative loss
Calculation
Increase in fair value less costs to sell ; Cumulative loss recognised previously
Gain on disposal
Calculation
0
Selling price ; − Costs to sell incurred ; − Carrying amount derecognised
Loss on disposal
Calculation
0
Selling price ; − Costs to sell incurred ; − Carrying amount derecognised
Carrying amount before classification adjusted for missed depreciation
Calculation
120,000
Carrying amount immediately before classification (after the last depreciation charge) ; − Depreciation not recognised during the classification
Amount measured on ceasing the classification (lower of the adjusted amount and the recoverable amount)
Calculation
120,000
Carrying amount before classification adjusted for missed depreciation ; Recoverable amount at the date of the decision not to sell (datum of the file)

Journal entries

Entries

Last depreciation charge up to the classification date
Entry
Account Debit Credit
Depreciation expense 30,000
Accumulated depreciation 30,000
Reclassification to assets held for sale
Entry
Account Debit Credit
Asset held for sale 150,000
Property, plant and equipment (net amount) 150,000
Loss down to fair value less costs to sell
Entry
Account Debit Credit
Impairment loss 150,000
Asset held for sale 150,000
Capped reversal gain
Entry
Debit Asset held for sale ← Reversal gain capped at the cumulative loss ; Credit Impairment reversal gain ← Reversal gain capped at the cumulative loss
Disposal with a gain
Entry
Debit Cash ← Net cash received (price less costs to sell) ; Credit Asset held for sale ← Carrying amount derecognised ; Credit Gain on disposal ← Gain on disposal
Disposal with a loss
Entry
Debit Cash ← Net cash received (price less costs to sell) ; Debit Loss on disposal ← Loss on disposal ; Credit Asset held for sale ← Carrying amount derecognised
Missed depreciation on ceasing the classification (excluding any loss down to the recoverable amount)
Entry
Account Debit Credit
Depreciation expense 30,000
Accumulated depreciation 30,000

Account	Debit	Credit
Depreciation expense	30,000
Accumulated depreciation		30,000

Account	Debit	Credit
Asset held for sale	150,000
Property, plant and equipment (net amount)		150,000

Account	Debit	Credit
Impairment loss	150,000
Asset held for sale		150,000

Account	Debit	Credit
Depreciation expense	30,000
Accumulated depreciation		30,000

Judgements

Judgment

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Fair value retained
JudgmentRequired
Fair value supported by a valuation / Fair value to review before concluding
Rule and cross-reference: an asset held for sale is measured at the lower of its carrying amount and its fair value less costs to sell (IFRS 5, para. 15); costs to sell are the incremental costs directly attributable to the disposal, excluding finance costs and income tax (IFRS 5, Appendix A). The fair value retained is a datum of the file and a documented judgement.
Rationale: source of the fair value, date, assumptions, alternative rejected
TextRequired

Conclusion

Amount measured, loss or reversal and result submitted to the reviewer
ConclusionRequired

Effect on the financial statements

FS impact

Effect of the entries, line by line (derived from the entries)
Table

Disclosures

Disclosure

IFRS 5 §15IFRS 5 §20IFRS 5 §21IFRS 5 §28

Disclosures: losses, reversals, measurement basis, adjustment on ceasing
ChecklistRequired
- Losses and reversals stated
- Measurement basis stated
- Ceasing adjustment presented in profit or loss from continuing operations

Normative references

References

Paragraphs cited in this workpaper and their verification status
References

Checks and financial statement impact

Judgement on fair value documentedNot filled in this instance
Last depreciation entry balancedPass
Reclassification entry balancedPass
Loss entry balancedPass
Reversal entry balancedNot evaluated
Disposal entry with a gain balancedNot evaluated
Disposal entry with a loss balancedNot evaluated
Ceasing entry balancedPass

Assets: -210,000
Liabilities: 0
Profit or loss: -210,000
OCI: 0
Equity: -210,000

Inputs

Asset: nature, classification date and basis of the carrying amount
Text
Cost of the asset
Number
Residual value
Number
Useful life (in years)
Number
Carrying amount immediately before classification (after the last depreciation charge)
Number
Fair value of the asset (datum of the file)
Number
Costs to sell (nature, amount)
Table
Cumulative loss recognised previously
Number
Increase in fair value less costs to sell
Number
Selling price
Number
Costs to sell incurred
Number
Carrying amount derecognised
Number
Net cash received (price less costs to sell)
Number
Depreciation not recognised during the classification
Number
Recoverable amount at the date of the decision not to sell (datum of the file)
Number

Supporting evidence

Evidence

Evidence obtained and referenced (category, document reference)
EvidenceRequired

Analysis of the measurement

Analysis

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Points reviewed: prior remeasurement, last charge, costs, lower of, loss, reversal, disposal, ceasing
ChecklistRequired
- Carrying amount updated under the applicable standard before classification
- Last depreciation charge booked up to classification, none afterwards
- Costs to sell identified, finance costs and income tax excluded
- Lower of carrying amount and fair value less costs to sell applied
- Loss recognised in profit or loss
- Reversal capped at the cumulative loss
- Gain or loss not yet recognised taken at the date of sale
- Measurement on ceasing the classification and adjustment presented in profit or loss

Calculations

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Straight-line annual charge (last full charge, classification at the reporting date)
Calculation
Cost of the asset ; Residual value ; Useful life (in years)
Total costs to sell
Calculation
Costs to sell (nature, amount)
Fair value less costs to sell
Calculation
Fair value of the asset (datum of the file) ; − Total costs to sell
Amount measured at the lower of
Calculation
Carrying amount immediately before classification (after the last depreciation charge) ; Fair value less costs to sell
Impairment loss to recognise
Calculation
Carrying amount immediately before classification (after the last depreciation charge) ; − Amount measured at the lower of
Reversal gain capped at the cumulative loss
Calculation
Increase in fair value less costs to sell ; Cumulative loss recognised previously
Gain on disposal
Calculation
Selling price ; − Costs to sell incurred ; − Carrying amount derecognised
Loss on disposal
Calculation
Selling price ; − Costs to sell incurred ; − Carrying amount derecognised
Carrying amount before classification adjusted for missed depreciation
Calculation
Carrying amount immediately before classification (after the last depreciation charge) ; − Depreciation not recognised during the classification
Amount measured on ceasing the classification (lower of the adjusted amount and the recoverable amount)
Calculation
Carrying amount before classification adjusted for missed depreciation ; Recoverable amount at the date of the decision not to sell (datum of the file)

Journal entries

Entries

Last depreciation charge up to the classification date
Entry
Debit Depreciation expense ← Straight-line annual charge (last full charge, classification at the reporting date) ; Credit Accumulated depreciation ← Straight-line annual charge (last full charge, classification at the reporting date)
Reclassification to assets held for sale
Entry
Debit Asset held for sale ← Carrying amount immediately before classification (after the last depreciation charge) ; Credit Property, plant and equipment (net amount) ← Carrying amount immediately before classification (after the last depreciation charge)
Loss down to fair value less costs to sell
Entry
Debit Impairment loss ← Impairment loss to recognise ; Credit Asset held for sale ← Impairment loss to recognise
Capped reversal gain
Entry
Debit Asset held for sale ← Reversal gain capped at the cumulative loss ; Credit Impairment reversal gain ← Reversal gain capped at the cumulative loss
Disposal with a gain
Entry
Debit Cash ← Net cash received (price less costs to sell) ; Credit Asset held for sale ← Carrying amount derecognised ; Credit Gain on disposal ← Gain on disposal
Disposal with a loss
Entry
Debit Cash ← Net cash received (price less costs to sell) ; Debit Loss on disposal ← Loss on disposal ; Credit Asset held for sale ← Carrying amount derecognised
Missed depreciation on ceasing the classification (excluding any loss down to the recoverable amount)
Entry
Debit Depreciation expense ← Depreciation not recognised during the classification ; Credit Accumulated depreciation ← Depreciation not recognised during the classification

Judgements

Judgment

IFRS 5 §15IFRS 5 §18IFRS 5 §20IFRS 5 §21IFRS 5 §22IFRS 5 §24IFRS 5 §25IFRS 5 §27IFRS 5 §28IFRS 5

Fair value retained
JudgmentRequired
Fair value supported by a valuation / Fair value to review before concluding
Rule and cross-reference: an asset held for sale is measured at the lower of its carrying amount and its fair value less costs to sell (IFRS 5, para. 15); costs to sell are the incremental costs directly attributable to the disposal, excluding finance costs and income tax (IFRS 5, Appendix A). The fair value retained is a datum of the file and a documented judgement.
Rationale: source of the fair value, date, assumptions, alternative rejected
TextRequired

Conclusion

Amount measured, loss or reversal and result submitted to the reviewer
ConclusionRequired

Effect on the financial statements

FS impact

Effect of the entries, line by line (derived from the entries)
Table

Disclosures

Disclosure

IFRS 5 §15IFRS 5 §20IFRS 5 §21IFRS 5 §28

Disclosures: losses, reversals, measurement basis, adjustment on ceasing
ChecklistRequired
- Losses and reversals stated
- Measurement basis stated
- Ceasing adjustment presented in profit or loss from continuing operations

Normative references

References

Paragraphs cited in this workpaper and their verification status
References