IAS 36 Impairment of Assets

Date recorded:


The IFRIC considered two issues focused on IAS 36 paragraph 37, which requires the cash flows used in the value in use calculation not to include cash flows that are expected to arise from (a) a future restructuring to which an enterprise is not yet committed; or (b) future capital expenditure that will improve or enhance the asset in excess of its standard of performance assessed immediately before the expenditure is made.  The IFRIC noted that it was likely that resolution of these issues would require an amendment to IAS 36. Also the IASB is already amending IAS 36 as part of its project on business combinations. For these reasons, the IFRIC agreed that these issues would be better addressed directly by the Board rather than by the IFRIC.


Decision not to add

February 2003



The Board considered this issue at the November 2003 meeting, making a minor amendment to the IAS 36 paragraph 27(b) as a result of the discussion.

These issue are clarified at length in paragraphs BC68-BC75 of the Basis of Conclusions of IAS 36.


IFRIC reference: IAS 36

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