Download Ind AS 36, Impairment of Assets

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Ind AS 36: Impairment of Assets


The objective of this Standard is to prescribe the procedures that an entity applies to ensure that its assets are carried at no more than their recoverable amount. An asset is carried at more than its recoverable amount if its carrying amount exceeds the amount to be recovered through use or sale of the asset. If this is the case, the asset is described as impaired and the Standard requires the entity to recognise an impairment loss. The Standard also specifies when an entity should reverse an impairment loss and prescribes disclosures.


This Standard shall be applied in accounting for the impairment of all assets, other than:

(a) inventories (see Ind AS 2, Inventories);

(b) contract assets and assets arising from costs to obtain or fulfil a contract that are recognised in accordance with Ind AS 115, Revenue from Contracts with Customers;

(c) deferred tax assets (see Ind AS 12, Income Taxes);

(d) assets arising from employee benefits (see Ind AS 19, Employee Benefits);

(e) financial assets that are within the scope of Ind AS 109, Financial Instruments;

(f) biological assets related to agricultural activity within the scope of Ind AS 41 Agriculture that are measured at fair value less costs to sell ;

(g) deferred acquisition costs, and intangible assets, arising from an insurer’s contractual rights under insurance contracts within the scope of Ind AS 104, Insurance Contracts; and

(h) non-current assets (or disposal groups) classified as held for sale in accordance with Ind AS 105, Non-current Assets Held for Sale and Discontinued Operations.

This Standard does not apply to inventories, assets arising from construction contracts, deferred tax assets, assets arising from employee benefits, or assets classified as held for sale (or included in a disposal group that is classified as held for sale) because Indian Accounting Standards applicable to these assets contain requirements for recognising and measuring these assets.

This Standard applies to financial assets classified as:

(a) subsidiaries, as defined in Ind AS 110, Consolidated Financial Statements;

(b) associates, as defined in Ind AS 28, Investments in Associates and Joint Ventures; and

(c) joint ventures, as defined in Ind AS 111, Joint Arrangements.

For impairment of other financial assets, refer to Ind AS 109.

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