Impairment effect on the IS, BS, CFS
I am confusing impairments, previously I thought impairment charges were added to COGS (and future revaluations subtracted COGS), now I am reading they are direct losses on the IS, I assume before taxes (they do not reduce taxes, right?, they only create a DTA, so they are expected to reverse? I thought impairments do not make tax benefits….)
On the BS there is a new value for the asset. On the CFS gains are subtracted and losses are added to arrive to CFO.
For IFRS, when there is a revaluation on the asset, the gains are recognized on the IS up to the previous amount of the loss, any subsequent gain goes to equity directly, right? (where to specifically?, to accumulated other comprehensive income?)
If I change my asset from held for use and held for sale, GAAP allows revaluation, but I assume following the same rule I explained earlier (up to the previous loss amount, other gain goes directly to equity).
P.D. If a classify my asset to held for sale, I will not recognize any depreciation or amortisation any more, right? what other effects are on the statements???
Thank you very much guys, you have had a lot of patience on me, very very much appreciated.
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