in General IFRS Discussion by
To elaborate my above question. If asset (in this case, Right of Use asset) is impaired and a company maintains ‘Accumulated Impairment loss’ account then the first entry will be:
Dr Impairment loss (P&L)
Cr Accumulated impairment loss (BS)
My QUESTION is that what accounting entry will reduce the value of the asset? Should, at the end of the life of the asset, I also need to post (in addition to above) :
Dr Accumulated impairment loss (BS)
Cr Asset (Right of use asset)
If I wont then the issue is that post impairment, my depreciation will reduce and if I won't reduce the value of the asset then at the end of the life of the asset, my asset wont be fully depreciated - and accumulated depreciation will be less than the initial ROU Asset.
Thank you in advance.
Look at it this way.
Treat the impairment as you would treat depreciation.
Treat the accumulated impairment as you would accumulated depreciation.

The initial cost of the ROU asset will remain same. The depreciation and impairment is accumulated in accumulated depreciation and accumulated impairment account respectively so that at every point in time, the carrying amount of the ROU asset will be cost less accumulated depreciation and accumulated impairment loss.

So, if you post:
Dr: Impairment
Cr: Accumulated impairment,
then there is no need to credit the ROU asset.

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by Level 5 Member (29.1k points)
This may help:

Hi, Thank you for sharing this. I read this already but it doesn't talk about the accounting entry to impact ASSET.
Plus, my question is for IFRS 16 'Right of Use Asset' - in case someone has any specific knowledge to share.

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