Value Proposition:
This template transforms the impairment test from a theoretical exercise into a practical and reviewable procedure:
Clear indicators → Documented assumptions → Traceable calculations → Supported accounting decision.
Objective: To resolve disputes with auditors regarding why impairment was/was not recognized.

In 20 Seconds: What Will You Get?

• Indicators Checklist: A list of impairment indicators (internal/external) with an assessment of the impact of each indicator.
• Asset / CGU Setup: Setting up the asset or cash-generating unit and linking it to the carrying amount.
• Recoverable Amount: Calculation of the recoverable amount.
• Value in Use (VIU): A discounted cash flow (DCF) model with clear steps.
• Discount Rate: Determining and documenting the discount rate (WACC or alternative rate) with justifications.
• Sensitivity Analysis: Sensitivity testing for discount and growth assumptions.
• Impairment Loss: Determining the amount of loss, if any.
• Journal Entry: Impairment loss entry + updating the carrying amount.
• Audit Pack: A file of evidence and assumptions ready for review.

Suitable For

• Companies subject to external audit.
• Entities with significant assets or cash-generating units.
• Financial managers and heads of accounts during performance declines or market changes.

Not Suitable For

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