280楼#
发布于:2012-02-02 17:03
IE81 M acquired unit C, a manufacturing operation in North America, in December 20X2. Unlike M's other North American operations, C operates in an industry with high margins and high growth rates, and with the benefit of a 10-year patent on its primary product. The patent was granted to C just before M's acquisition of C. As part of accounting for the acquisition of C, M recognised, in addition to the patent, goodwill of CU3,000 and a brand name of CU1,000. M's management has determined that the brand name has an indefinite useful life. M has no other intangible assets with indefinite useful lives.
IE82 The carrying amounts of goodwill and intangible assets with indefinite useful lives allocated to units A, B and C and to operation XYZ are as follows: Goodwill CU Intangible assets with indefinite useful lives CU A 350 B 450 C 3,000 1,000 XYZ 1,200 Total 5,000 1,000 |
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281楼#
发布于:2012-02-02 17:03
IE83 During the year ending 31 December 20X3, M determines that there is no impairment of any of its cash-generating units or group of cash-generating units containing goodwill or intangible assets with indefinite useful lives. The recoverable amounts (ie higher of value in use and fair value less costs to sell) of those units and group of units are determined on the basis of value in use calculations. M has determined that the recoverable amount calculations are most sensitive to changes in the following assumptions:
Units A and B Unit C Operation XYZ Gross margin during the budget period (budget period is 4 years) 5-year US government bond rate during the budget period (budget period is 5 years) Gross margin during the budget period (budget period is 5 years) Raw materials price inflation during the budget period Raw materials price inflation during the budget period Japanese yen/US dollar exchange rate during the budget period Market share during the budget period Market share during the budget period Market share during the budget period Growth rate used to extrapolate cash flows beyond the budget period Growth rate used to extrapolate cash flows beyond the budget period Growth rate used to extrapolate cash flows beyond the budget period IE84 Gross margins during the budget period for A, B and XYZ are estimated by M based on average gross margins achieved in the period immediately before the start of the budget period, increased by 5 per cent per year for anticipated efficiency improvements. A and B produce complementary products and are operated by M to achieve the same gross margins. |
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282楼#
发布于:2012-02-02 17:03
IE85 Market shares during the budget period are estimated by M based on average market shares achieved in the period immediately before the start of the budget period, adjusted each year for any anticipated growth or decline in market shares. M anticipates that:
(a) market shares for A and B will differ, but will each grow during the budget period by 3 per cent per year as a result of ongoing improvements in product quality. (b) C's market share will grow during the budget period by 6 per cent per year as a result of increased advertising expenditure and the benefits from the protection of the 10-year patent on its primary product. (c) XYZ's market share will remain unchanged during the budget period as a result of the combination of ongoing improvements in product quality and an anticipated increase in competition. IE86 A and B purchase raw materials from the same European suppliers, whereas C's raw materials are purchased from various North American suppliers. Raw materials price inflation during the budget period is estimated by M to be consistent with forecast consumer price indices published by government agencies in the relevant European and North American countries. |
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283楼#
发布于:2012-02-02 17:03
IE87 The 5-year US government bond rate during the budget period is estimated by M to be consistent with the yield on such bonds at the beginning of the budget period. The Japanese yen/US dollar exchange rate is estimated by M to be consistent with the average market forward exchange rate over the budget period.
IE88 M uses steady growth rates to extrapolate beyond the budget period cash flows for A, B, C and XYX. The growth rates for A, B and XYZ are estimated by M to be consistent with publicly available information about the long-term average growth rates for the markets in which A, B and XYZ operate. However, the growth rate for C exceeds the long-term average growth rate for the market in which C operates. M's management is of the opinion that this is reasonable in the light of the protection of the 10-year patent on C's primary product. |
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284楼#
发布于:2012-02-02 17:03
IE89 M includes the following disclosure in the notes to its financial statements for the year ending 31 December 20X3.
Impairment Tests for Goodwill and Intangible Assets with Indefinite Lives Goodwill has been allocated for impairment testing purposes to three individual cash-generating units-two in Europe (units A and B) and one in North America (unit C)-and to one group of cash-generating units (comprising operation XYZ) in Asia. The carrying amount of goodwill allocated to unit C and operation XYZ is significant in comparison with the total carrying amount of goodwill, but the carrying amount of goodwill allocated to each of units A and B is not. Nevertheless, the recoverable amounts of units A and B are based on some of the same key assumptions, and the aggregate carrying amount of goodwill allocated to those units is significant. |
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285楼#
发布于:2012-02-02 17:03
Operation XYZ
The recoverable amount of operation XYZ has been determined based on a value in use calculation. That calculation uses cash flow projections based on financial budgets approved by management covering a five-year period, and a discount rate of 8.4 per cent. Cash flows beyond that five-year period have been extrapolated using a steady 6.3 per cent growth rate. This growth rate does not exceed the long-term average growth rate for the market in which XYZ operates. Management believes that any reasonably possible change in the key assumptions on which XYZ's recoverable amount is based would not cause XYZ's carrying amount to exceed its recoverable amount. Unit C The recoverable amount of unit C has also been determined based on a value in use calculation. That calculation uses cash flow projections based on financial budgets approved by management covering a five-year period, and a discount rate of 9.2 per cent. C's cash flows beyond the five-year period are extrapolated using a steady 12 per cent growth rate. This growth rate exceeds by 4 percentage points the long-term average growth rate for the market in which C operates. However, C benefits from the protection of a 10-year patent on its primary product, granted in December 20X2. Management believes that a 12 per cent growth rate is reasonable in the light of that patent. Management also believes that any reasonably possible change in the key assumptions on which C's recoverable amount is based would not cause C's carrying amount to exceed its recoverable amount. |
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286楼#
发布于:2012-02-02 17:03
Units A and B
The recoverable amounts of units A and B have been determined on the basis of value in use calculations. Those units produce complementary products, and their recoverable amounts are based on some of the same key assumptions. Both value in use calculations use cash flow projections based on financial budgets approved by management covering a four-year period, and a discount rate of 7.9 per cent. Both sets of cash flows beyond the four-year period are extrapolated using a steady 5 per cent growth rate. This growth rate does not exceed the long-term average growth rate for the market in which A and B operate. Cash flow projections during the budget period for both A and B are also based on the same expected gross margins during the budget period and the same raw materials price inflation during the budget period. Management believes that any reasonably possible change in any of these key assumptions would not cause the aggregate carrying amount of A and B to exceed the aggregate recoverable amount of those units. |
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287楼#
发布于:2012-02-02 17:04
Operation XYZ Unit C Units A and B (in
aggregate) Carrying amount of goodwill CU1,200 CU3,000 CU800 Key assumptions used in value in use calculations * • Key assumption • Basis for determining value(s) assigned to key assumption • Budgeted gross margins • Average gross margins achieved in period immediately before the budget period, increased for expected efficiency improvements. • Values assigned to key assumption reflect past experience, except for efficiency improvements. Management believes improvements of 5% per year are reasonably achievable. • 5-year US government bond rate • Yield on 5-year US government bonds at the beginning of the budget period. • Value assigned to key assumption is consistent with external sources of information. • Budgeted gross margins • Average gross margins achieved in period immediately before the budget period, increased for expected efficiency improvements. • Values assigned to key assumption reflect past experience, except for efficiency improvements. Management believes improvements of 5% per year are reasonably achievable. • Key assumption • Basis for determining value(s) assigned to key assumption • Japanese yen/ US dollar exchange rate during the budget period • Average market forward exchange rate over the budget period. • Value assigned to key assumption is consistent with external sources of information. • Raw materials price inflation • Forecast consumer price indices during the budget period for North American countries from which raw materials are purchased. • Value assigned to key assumption is consistent with external sources of information. • Raw materials price inflation • Forecast consumer price indices during the budget period for European countries from which raw materials are purchased. • Value assigned to key assumption is consistent with external sources of information. • Key assumption • Basis for determining value(s) assigned to key assumption • Budgeted market share • Average market share in period immediately before the budget period. • Value assigned to key assumption reflects past experience. No change in market share expected as a result of ongoing product quality improvements coupled with anticipated increase in competition. • Budgeted market share • Average market share in period immediately before the budget period, increased each year for anticipated growth in market share. • Management believes market share growth of 6% per year is reasonably achievable due to increased advertising expenditure, the benefits from the protection of the 10-year patent on C's primary product, and the expected synergies to be achieved from operating C as part of M's North American segment. * The key assumptions shown in this table for units A and B are only those that are used in the recoverable amount calculations for both units. |
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288楼#
发布于:2012-02-02 17:04
Table of Concordance
This table shows how the contents of the superseded version of IAS 36 and the current version of IAS 36 correspond. Paragraphs are treated as corresponding if they broadly address the same matter even though their guidance may differ. Superseded paragraph Current paragraph Superseded paragraph Current paragraph Objective 1 24 28 1 2 25 29 2 3 26 31 3 4 27 33 4 5 28 35 5 6 29 36 6 7 30 37 7 8 31 38 8 9 32 39 9 12 33 40 10 13 34 41 11 14 35 42 12 15 36 43 13 16 37 44 14 17 38 45 15 18 39 46 16 19 40 47 17 20 41 48 18 21 42 49 19 22 43 50 20 23 44 51 21 25 45 52 22 26 46 53 23 27 47 54 48 55 77 78 49 56 78 79 50 57, A16 79 81 51 A17 80-82 80, 82, 88, 90 52 A18 83 None 53 A15 84 100 54 A19 85 101 55 A20 86 102 56 A21 87 103 57 58 88 104 58 59 89 105 59 60 90 None 60 61 91 106 61 62 92 107 62 63 93 108 63 64 94 109 64 65 95 110 65 66 96 111 66 67 97 112 67 68 98 113 68 69 99 114 69 70 100 115 70 71 101 116 71 72 102 117 72 73 103 118 73 74 104 119 74 75 105 120 75 76 106 121 76 77 107 122 108 123 A15 IE15 109 124 A16 IE16 110 125 A17 IE17 111 124 A18 IE18 112 None A19 IE19 113 126 A20 IE20 114 127 A21 IE21 115 128 A22 IE22 116 129 A23 IE23 117 130 A24 IE27 118 131 A25 IE25 119 132 A26 IE23A, IE24, IE26 121 None A27 None 122 139 A28 IE28 A1 IE1 A29 IE29 A2 IE2 A30 IE30 A3 IE3 A31 IE31 A4 IE4 A32 IE32 A5 IE5 A33 IE33 A6 IE6 A34 IE34 A7 IE7 A35 IE35 A8 IE8 A36 IE36 A9 IE9 A37 IE37 A10 IE10 A38 IE38 A11 IE11 A39 IE39 A12 IE12 A40 IE40 A13 IE13 A41 IE41 A14 IE14 A42 IE42 120 138, 139 A43 IE43 A70 None A44 IE44 A71 None A45 IE45 A72 IE69 A46 IE46 A73 IE70 A47 IE47 A74 IE71 A48 IE48 A75 IE72 A49 IE48 A76 IE73 A50 IE50 A77 IE74 A51 IE51 A78 IE75 A52 IE52 A79 IE76 A53 IE53 A80 IE76 A54 IE54 A81 IE77 A55 IE55 A82 IE78 A56 IE56 A83 IE79 A57 IE57 None 10, 11 A58 IE58 None 24 A59 IE59 None 30 A60 IE60 None 32 A61 IE61 None 34 A62 None None 83-87 A63 None None 89 A64 None None 91-99 A65 None None 133-137 A66 None None 140, 141 A67 None None A1-A14 A68 None None IE62-IE68 A69 None None IE80-IE89 |
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