Question

Under IFRS, what standard do you use for impairment?

a) IFRS 9
b) IFRS 15
c) IFRS 16
d) IFRS 13

Answer 1

Under IFRS, IFRS 9 is the standard used for impairment, specifically for financial instruments. It introduced an expected credit loss model for assessing impairment of these assets. Non-financial assets are covered by a different standard, IAS 36.

Step-by-step explanation:

Under IFRS, the standard used for impairment is IFRS 9. Impairment refers to the reduction in the recoverable amount of a fixed asset or goodwill below its book value. IFRS 9 encompasses the requirements for the recognition and measurement of financial instruments, which includes guidance on the impairment of financial assets.

Previously, IAS 39 was the standard that dealt with financial instruments, including impairment, but it was replaced by IFRS 9 which introduced an expected credit loss model for the assessment of financial assets impairment.

On the other hand, non-financial assets, such as property, plant, and equipment or intangible assets, are subject to impairment considerations within the scope of IAS 36 - Impairment of Assets, which is not one of the options provided in the question.