IFRS 5: Non-Current Assets Held for Sale and Discontinued Operations
- management must be committed to a plan to sell the asset;
- there must be an active programme of seeking a buyer;
- the asset (or disposal group) must be available for immediate sale;
- the sale is highly probable; and
- the sale is expected to complete within one year of the asset being classified as held for sale.
- represent a separate major line of business or geographical area of operations;
- be part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operation; or
- be a subsidiary acquired exclusively with a view to resale.
For financial reporting purposes, the revenue, expenses, pre-tax profit or loss and the income tax expense of the discontinued operation should be separately presented on the face of the statement of comprehensive income (income statement) or in the notes to the financial statements.
Steve Collings FMAAT ACCA DipIFRS is Audit Manager at Leavitt Walmsley Associates www.lwaltd.com. Read all of Collings's analyses of the International Financial Reporting Standards.
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