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Accounting Research On Impairment Of Long-lived Assets

Posted on:2004-08-07Degree:MasterType:Thesis
Country:ChinaCandidate:D ChenFull Text:PDF
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Long-lived asset impairment has been of particular interest to regulators, academics, managers and business press, which is mainly because that long-lived assets usually have enormous amounts, and their impairment would have great impact on the book value of assets, accounting earnings and market returns, furthermore, accounting of asset impairment can't depart from estimates and forecasts, which allows firms to use the judgments to manage earnings. In order to standardize the accounting of long-lived assets in practice, FASB and IASB issued related standards in 1995 and 1998 respectively. China issued "accounting regulations for business enterprises" in 2000, which enlarged the scope of impairment loss recognized in "accounting regulations for the limited companies" from four items to eight items, except long term investment, the regulation have added other three long-lived asset impairment: fixed assets, assets in building and intangible assets, which give gist to accounting of most long-lived assets impairment in practice. But the regulations for long-lived asset impairment have many points to be improved. There are few researches on asset impairment in domestic academics. This paper expected to be helpful to improve and perfect the regulations through the study on the related questions.In the first place, this paper researched the theory basis of asset impairment. Then analyzed and compared SFAS No. 144 "accounting for the impairment or disposal of long-lived assets" and IAS No. 36 "impairment of assets", and paid attention to recognition and measurement. There were many worthy points to be reference by us. Then this paper analyzed the listed companies' performance of impairment regulations in Shenzhen stock exchange in 2001, and found that most companies recognized long-lived asset impairment, the impairment loss was very large, but the related accounting information was insufficient and diversified, and whether the information is useful is doubted. One of the main reasons why accounting of asset impairment was not satisfied in practice is thatthe related regulations are not perfect. On the basis of the practical performance and using SFAS144 and IAS36 for reference, this paper analyzed the regulations for enterprises related to long-lived assets impairment in detail, pointed out the shortages, and brought forward ideas to improve and perfect the impairment regulations.
Keywords/Search Tags:asset impairment, recoverable amount, SFAS No.144, IAS No, 36
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