Accounting Standards 1-29 - Seth & Associates

88. In allocating an impairment loss under
paragraph 87, the carrying amount of an
asset should not be reduced below the
highest of:
a. its net selling price (if
determinable);
b. its value in use (if determinable);
and
c. zero.
The amount of the impairment loss that
would otherwise have been allocated to the
asset should be allocated to the other
assets of the unit on a pro-rata basis.
89. The goodwill allocated to a cash-generating
unit is reduced before reducing the carrying
amount of the other assets of the unit because
of its nature.
90. If there is no practical way to estimate the
recoverable amount of each individual asset of
a cash-generating unit, this Statement requires
the allocation of the impairment loss between
the assets of that unit other than goodwill on a
pro-rata basis, because all assets of a cashgenerating
unit work together.
91. If the recoverable amount of an individual
asset cannot be determined (see paragraph
65):
a. an impairment loss is recognised for
the asset if its carrying amount is
greater than the higher of its net selling
price and the results of the allocation
procedures described in paragraphs
87 and 88; and
b. no impairment loss is recognised for
the asset if the related cash-generating
unit is not impaired. This applies even
if the asset’s net selling price is less
than its carrying amount.