Professional Research At a recent meeting of the accounting staff in your company, the controller raised the issue of using present value techniques to conduct impairment tests for some of the company’s fixed assets. Some of the more senior members of the staff admitted having little knowledge of present value concepts in this context, but they had heard about an appendix to an IFRS that provides some guidance. As the junior staff in the department, you have been asked to conduct some research of the authoritative literature on this topic and report back at the staff meeting next week.

Instructions Access the IFRS authoritative literature at the IASB website (http://eifrs.iasb.org/) (you may register for free eIFRS access at this site). When you have accessed the documents, you can use the search tool in your Internet browser to respond to the following questions. (Provide paragraph citations.)

(a) Identify the components of present value measurement.

(b) Briefly describe the differences between the “traditional” and “expected cash flow” approaches to present value.

(c) What are the factors that should be taken into account when an asset-specific discount rate is not available from the market?