Non-current assets held for sale and discontinued operations (IFRS 5) Chapter 9. It is possible that the sale may not be completed within one year, but the delay effectively must be caused by events beyond the entity’s control and the entity must still be committed to selling the asset. Free IFRS 2 multiple choice quiz. In this article, Steve Collings looks at how an entity should account for non-current assets which have been classified as held for sale. As regards the presentation in the cash flow statement, the net cash flows attributable to the operating, investing and financing activities of the discontinued operation should be separately shown on the face of the cash flow statement or disclosed in the notes. Are … Chapter 8. If you fail the test, please re-read the article before attempting the questions again General IFRS Discussion (129) IFRS for SMEs (5) IFRS 1 - First-time Adoption of International Financial Standards (15) IFRS 2 - Share-based Payment (9) IFRS 3 - Business Combinations (10) IFRS 4 - Insurance Contracts (6) IFRS 5 - Non-current Assets Held for Sale and Discontinued Operations (3) IFRS 6 - Exploration for and … The loss will be charged against profit or loss. The maxim “Practice Makes Perfect” cannot be overemphasized. IFRS 5 – Non-Current Assets Held for Sale and Discontinued Operations This article is relevant for ACCA F7 and P2 plus AAT and CIMA papers. Thus, in this case, there would be separate disclosure of the disposal group as follows. IFRS 5 requires detailed disclosure of revenue, expenses, pre-tax profit or loss, and the related income tax expense either in the notes or on the face of the income statement. Posted by 5 days ago. The units to be closed constitute a major segment of its business and will close in the current financial year. A 2 and 3 the actions required to complete the planned sale will have been made, and it is unlikely that the plan will be significantly changed or withdrawn. Such a non-current asset will be classified as held-for-sale at the date of the acquisition only if it is anticipated that it will be sold within the one-year period, and it is highly probable that the held-for-sale criteria will be met within a short period (normally three months) of the acquisition date. Retrospective classification as a discontinued operation where the criteria are met after the balance sheet date is prohibited by IFRS 5. Please visit our global website instead, Can't find your location listed? ACCA BT F1 MA F2 FA F3 LW F4 Eng PM F5 TX F6 UK FR F7 AA F8 FM F9 SBL SBR INT SBR UK AFM P4 APM P5 … Thus, goodwill will be reduced to zero. ACCA CIMA CPD FIA (ACCA) AAT. IFRS 5 Non-current Assets Held for Sale IFRS 5 Non-current Assets Held for Sale and Discontinued Operations says that a discontinued operation is a component of an entity that has been sold, or which is classified as held for sale, and which is: a separate line of business (either in terms of operations or location) part … To find out more, see our Cookies Policy Under IFRS, property, plant and equipment would be stated at $26m, and inventory stated at $18m. AAA P7 INT. Quiz: IFRS 5 Non-current assets held for sale and discontinued operations (Conceptual) The quiz tests your theoretical and conceptual understanding of accounting for Non-current assets held for sale and discontinued operations (International Financial Reporting Standard 5). Hence you can not start it again. 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