IFRS 5 – Non-Current Assets Held For Sale and Discontinued Operations
Non-Current Assets Held For Sale
Classification as Non-Current Assets Held For Sale :
Non-Current Assets Held For Sale …..through a sale transaction rather than though continuing use.
The following conditions must apply:
1.the asset must be available for immediate sale in its present condition
2.The asset must be highly probable, meaning that:
- Management are committed to a plan to sell the asset
- There is an active programme to locate a buyer, and
- The asset is being actively marketed
3.The sale is expected to be completed within 12 months of its classification as held for sale
4.It is unlikely that the plan will be significantly changed or will be withdrawn.
Measurement of Non-Current Assets Held for Sale:
Lower of:
-Their carrying amount and
-Fair value less costs to sell
Held for sale non-current assets should be:
-Current asset
-Not depreciated
Discounted Operations
A discounted operation is a component of an entity that has either been disposed of, or is classified as held for sale.
An entity must disclose a single amount on the face of the statement of profit or loss. Alternatively the single amount could be given on the face of the statement of profit or loss, with separate columns for continuing operations, discounted operations, and total amounts.
Reference:
-ACCA, F7 Financial Reporting by KAPLAN PUBLISHING
-ACCA, F7 Financial Reporting by BPP