The IASB met on 23 April 2013 to analyse comment letters received on the Exposure Draft ED/2013/1 Recoverable Amount Disclosures for Non-Financial Assets (Proposed Amendments to IAS 36) that was published in January 2013.
In developing IFRS 13, the IASB intended to amend some of the disclosure requirements in IAS 36 Impairment of Assets for measuring the recoverable amount of impaired assets, particularly if that recoverable amount is based on fair value less costs of disposal (formerly ‘fair value less costs to sell’). However, instead the amendment resulted in a requirement to disclose the recoverable amount for each cash-generating unit for which the carrying amount of goodwill or intangible assets with indefinite useful lives allocated to that unit is significant in comparison with the entity’s total carrying amount of goodwill or intangible assets with indefinite useful lives. The amendments proposed in the Exposure Draft clarified that the requirement to disclose the recoverable amount is intended only for impaired assets and not for each cash-generating unit for which the carrying amount of goodwill is significant.
The Exposure Draft also proposed to amend paragraph 130 of IAS 36 to require additional information about the fair value less costs of disposal of an individual asset for which the entity has recognised or reversed an impairment loss during the period, consistently with the disclosure requirements for impaired assets in US GAAP.
Moreover, the amendments in the Exposure Draft incorporated an amendment proposed by the Exposure Draft ED/2012/1 Annual Improvements to IFRSs 2010–2012 Cycle published in May 2012. That proposed amendment would require an entity to disclose the discount rate(s) used in the current and previous measurements (if any), when the recoverable amount of an impaired asset determined on the basis of fair value less costs of disposal was measured using a present value technique.
The Exposure Draft proposed that the amendments should be applied retrospectively for annual periods beginning on or after 1 January 2014 and that earlier application of the amendments should be permitted.
Having considered respondents’ comments, the IASB tentatively decided to proceed with the final amendments subject to only minor drafting modifications.
All IASB members agreed.
The IASB expects to issue the Amendments to IAS 36 in May 2013.