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Impairment of assets - between regulation and deregulation


  • Professor Traian Nicolae, Ph.D.

    () (Affiliation: Faculty of Economic Studies,University Ovidius Constantza, Romania)


Objective of IAS 36 Impairment of assets is to prescribe procedures that apply to an undertaking to ensure that its assets are carried at amounts not exceeding their recoverable amount if the carrying amount is recoverable in full. An asset is carried at an amount not exceeding the amount will be recovered through its use or sale. If this case proves, is described as impaired assets and IAS 36 requires the company to account for a loss of value. Also, the rule specifies that a business case should include (lessen) a loss of value and should provide information on assets that have depreciated. There may be situations in which external influences or changes in production methods within the entity led to decreased value of an asset far more than is acknowledged in annual depreciation costs. In this case, it is said that the asset is impaired.

Suggested Citation

  • Professor Traian Nicolae, Ph.D., 2010. "Impairment of assets - between regulation and deregulation," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(1), pages 1744-1749, May.
  • Handle: RePEc:ovi:oviste:v:10:y:2010:i:1:p:1744-1749

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    Impairment ; recoverable amount; value in use;

    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting


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