Using the information from Example 25.10 where the carrying value of the financial asset at 31 December
Question:
Using the information from Example 25.10 where the carrying value of the financial asset at 31 December 2017 was €5 million. If, in early 2018, it was identified that the bond issuer was beginning to experience financial difficulties and that there was doubt regarding full recovery of the amounts due to Aquaria Limited, an impairment review would be required. The expected future cash flows now expected by Aquaria Limited from the bond issuer are as follows:
31 December 2018 €0.20m 31 December 2019 €0.20m 31 December 2020 €0.20m 31 December 2021 €0.20m + €4.4m Requirement Calculate the extent of impairment of the financial asset to be included in the financial statements of Aquaria Limited for the year ending 31 December 2018.
Step by Step Answer:
International Financial Accounting And Reporting
ISBN: 9781912350025
6th Edition
Authors: Ciaran Connolly