ias-impairment

name	ias-impairment
description	Use when identifying, measuring, reviewing, or disclosing impairment under IAS 36 and Section 27, including CGU allocation, goodwill, value in use, fair value less costs of disposal, sensitivities, reversals, and disclosures.
status	active
metadata	{"portable":true,"category":"03-ifrs-specialised-standards","compatible_with":["claude-code","codex"]}

Impairment of Assets (IAS 36 / Section 27)

Use When

Use for impairment indicators, annual goodwill or indefinite-life tests, CGU allocation, VIU models, fair value less costs of disposal, headroom, sensitivity, impairment/reversal postings and disclosures.

Do Not Use When

Do not apply IAS 36 to assets whose impairment is governed by another Standard, including financial assets within IFRS 9, inventory, deferred tax assets, employee-benefit assets, fair-value investment property, biological assets and assets held for sale. Do not substitute Section 27 for full IFRS IAS 36.

Prerequisites

• doctrine/accounting-finance-doctrine.md, doctrine/references/full-ifrs-overlay.md.
• doctrine/references/ifrs-for-smes-default.md (Section 27).
• Asset register, budgets/forecasts, valuation evidence, CGU map and IF-IAS36-IMPAIRMENT source-register entry.

Advanced IAS 36 workstream

1. Build the complete asset population and assess market, technology, legal, economic, rate, damage, performance, restructuring and disposal indicators at each reporting date.
2. For full IFRS, test goodwill, indefinite-life intangibles and intangibles not yet available for use annually, and test other assets when indicators exist.
3. Allocate goodwill to the lowest CGU or CGU group monitored for management and expected to benefit from the combination; document consistency and limits.
4. Determine carrying amount on a comparable basis, including corporate assets and relevant liabilities, without double-counting recognised assets.
5. Estimate recoverable amount as the higher of VIU and fair value less costs of disposal. For VIU, evidence current-condition cash flows, forecast period, terminal assumptions and discount-rate consistency.
6. Calculate headroom and sensitivities for reasonably possible changes in growth, margin, cash conversion and discount rate. Expose model limitations.
7. Allocate a loss according to the framework and CGU rules, preserve revaluation treatment, and use linked correction/reversal postings.
8. Reverse non-goodwill impairment only when conditions support it and never above the carrying amount that would have resulted absent impairment. Do not reverse goodwill impairment under IAS 36.
9. Disclose assumptions, CGU composition, goodwill allocation, loss/reversal, sensitivity and estimation uncertainty; obtain independent review.

Section 27 route

Apply the IFRS for SMEs impairment requirements, including its treatment of indicators, recoverable amount, reversal and goodwill. Record the framework selection before any annual-test conclusion.

Inputs

Artifact	Produced by	Required?	Validation
Reporting-basis memo	Engagement owner	Required	Full IFRS/SME basis and period explicit.
Asset and CGU register	Fixed-asset/reporting owner	Required	Carrying amounts, useful lives, goodwill and allocations reconcile.
Forecast and valuation model	FP&A/valuation owner	Required when test triggered	Current condition, assumptions, rate, scenarios and sensitivity documented.
Indicator and judgement log	Controller	Required	External/internal indicators and rejected alternatives recorded.
Reviewer route	Doctrine owner	Required	IFRS and valuation reviewer assigned.

Outputs

Artifact	Consumed by	Acceptance evidence
Impairment indicator and scope memo	Close owner	Population completeness and applicable Standard exclusions.
CGU/VIU/FVLCD workpaper	Controller, valuation reviewer and auditor	Carrying amount, recoverable amount, headroom and sensitivity reconcile.
Journal and reversal map	GL and close	Posting service, period, approval and immutability controls preserved.
Impairment disclosure pack	Financial-statement reviewer	Assumptions, sensitivities, movements and uncertainty are traceable.

Decision Rules

Condition	Decision
Goodwill or qualifying intangible under full IFRS	Annual test required even without an indicator.
Recoverable amount below carrying amount	Recognise impairment and route the journal through approved posting.
VIU model uses unsupported future restructurings or growth	Reject/adjust model and escalate.
Goodwill impairment reversal proposed	Block; IAS 36 prohibits reversal.
Discount rate or forecast not independently evidenced	Block final conclusion or mark NOT ASSESSED.
Section 27 selected	Apply SME route; do not import IAS 36 annual-goodwill-test logic.

Acceptance Evidence

• references/indicator-checklist.md, references/value-in-use-workpaper-template.md, and references/advanced-ias36-cgu-and-viu-workpaper.md are completed as applicable.
• examples/goodwill-cgu-sensitivity.md covers annual testing, headroom, sensitivity and the blocked goodwill-reversal path.
• Asset register, forecast, valuation, journal and disclosure outputs reconcile.
• Human IFRS/valuation review and source status are explicit.

Evidence Produced

Category	Artifact	Format	Example
Correctness	CGU/VIU impairment workpaper	Markdown using references/advanced-ias36-cgu-and-viu-workpaper.md	docs/ifrs-workpapers/ias36-<id>.md
Release evidence	Impairment sensitivity and exception log	Markdown table	docs/ifrs-workpapers/ias36-exceptions-<period>.md

Anti-Patterns

• Testing only when management expects a loss while skipping mandatory annual tests.
• Assigning goodwill to CGUs that do not receive the expected benefits.
• Using a budget model without reconciling to approved plans and current condition.
• Calling a single discount-rate assumption “objective” without evidence or sensitivity.
• Reversing goodwill impairment or exceeding the no-impairment carrying amount.
• Leaving a triggered impairment loss unposted while the report is released.

Files

• references/indicator-checklist.md
• references/value-in-use-workpaper-template.md
• references/advanced-ias36-cgu-and-viu-workpaper.md
• examples/goodwill-cgu-sensitivity.md

Review Metadata

Field	Value
Owner role	IFRS impairment reviewer
Reviewer roles	IFRS technical reviewer; independent valuation reviewer; controller
Last reviewed	2026-08-27
Next review due	2026-12-31
Release state	Active advanced doctrine route; client release requires current source and human review
Caveat	VIU, FVLCD, CGU and sensitivity conclusions are estimate-sensitive.

Last reviewed: 2026-08-27. Next review due: 2026-12-31.