INTERNATIONAL FINANCIAL REPORTING STANDARD 5NON-CURRENT ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

KEY DISCUSSION POINTS

1• What are the objectives of this IFRS?

2• Scope

3• How to classify?

4• Which measurement method to be used?

5• How to present and disclose the information in Financial

Statements?

To specify the accounting for

To set the presentation and disclosure of

Asset held for sale

OBJECTIVE

Discontinued operations

Applies to all identifiable assets / disposal groups

SCOPE

CLASSIFICATION AND PRESENTATION REQUIREMENTS

MEASUREMENT REQUIREMENTS

Applies to all identifiable assets/disposal groups, except for:– Deferred tax assets (IAS 12)– Employee benefits (IAS 19 )– Financial assets (IFRS 9)– Investment property (IAS 40)– Agriculture (IAS 41)– Insurance contracts (IFRS 4)

Asset held for sale

CLASSIFICATIONWhen carrying amount will be recovered --- through a sale transaction

Asset is marketed at a reasonable price

Within one year

Active program to locate a buyer initiated

Management committed to a plan to sell

Available for sale in its present condition

Sale is highly probable

Continuation of Plan

Distributed to Owner

Asset Held for Sale

Caused by events or circumstance beyond entity’s control

Continue to recognize under IFRS 5, if:

Sufficient evidence that the entity remains committed to its plan to sell the asset

SALE EXPECTED IN OVER 1 YEAR

MEASUREMENT

Asset held for sale

LOWER OF

Carrying amountFair value less cost to

sell

MEASUREMENT

Before classification After classification

In line with applicable IFRSAsset measurement

Lower of Carrying Amount and Fair Value less cost to sell

Impairment

In line with applicable IFRS

In P&L or OCI

Difference of CA – Fair Value less cost to sell

Always in P&L

SUBSEQUENT MEASUREMENT

• No Depreciation

• Check the impairment of asset at end of each reporting period

• No gain will be recognized

CHANGE TO A PLAN TO SALE Criteria no longer meet, removed from classification

LOWER OF

Recoverable amount Original carrying amount before classification under IFRS 5

DISPOSAL GROUP

When entity tries the dispose of a group of assets and liabilities.

However, asset / operations expected to abandon don’t qualify

DISCONTINUED OPERATIONComponent of an entity, that:

Has been disposed of, or Is classified as held for sale

Represents a separate major line of business or geographical area of operations,

Is part of a plan to dispose it of, or

Subsidiary acquire to resale

When entity abandon any operation treated as discontinued operations.

PRESENTATION AND DISCLOSURE

STATEMENT OF COMPREHENSIVE INCOME

Single amount comprising of:

The post-tax profit or loss of discontinued operations

The post tax gain or loss recognized on the measurement and disposal.

Analysis of the single amount in the notes or the statement of Comprehensive Income

PRESENTATION AND DISCLOSURE

STATEMENT OF FINANCIAL POSITION

Present separately on the face of statement of Financial Position

Assets classified as held for sale

Assets and liabilities in the disposal group classified as held for sale

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