Accounting Standards 1-29 - Seth & Associates

a. if the enterprise sells the discontinuing operation substantially in its
entirety, none of the assets of the discontinuing operation generate
cash inflows independently from other assets within the discontinuing
operation. Therefore, recoverable amount is determined for the
discontinuing operation as a whole and an impairment loss, if any, is
allocated among the assets of the discontinuing operation in
accordance with this Statement;
b. if the enterprise disposes of the discontinuing operation in other ways
such as piecemeal sales, the recoverable amount is determined for
individual assets, unless the assets are sold in groups; and
c. if the enterprise abandons the discontinuing operation, the
recoverable amount is determined for individual assets as set out in
this Statement.
114. After announcement of a plan, negotiations with potential purchasers of the
discontinuing operation or actual binding sale agreements may indicate that
the assets of the discontinuing operation may be further impaired or that
impairment losses recognised for these assets in prior periods may have
decreased. As a consequence, when such events occur, an enterprise reestimates
the recoverable amount of the assets of the discontinuing operation
and recognises resulting impairment losses or reversals of impairment losses
in accordance with this Statement.
115. A price in a binding sale agreement is the best evidence of an asset’s (cashgenerating
unit’s) net selling price or of the estimated cash inflow from
ultimate disposal in determining the asset’s (cash-generating unit’s) value in
use.
116. The carrying amount (recoverable amount) of a discontinuing operation
includes the carrying amount (recoverable amount) of any goodwill that can
be allocated on a reasonable and consistent basis to that discontinuing
operation.
Disclosure
117. For each class of assets, the financial statements should disclose:
a. the amount of impairment losses recognised in the statement of
profit and loss during the period and the line item(s) of the
statement of profit and loss in which those impairment losses
are included;
b. the amount of reversals of impairment losses recognised in the
statement of profit and loss during the period and the line
item(s) of the statement of profit and loss in which those
impairment losses are reversed;