Lucid Limited, a leading technology company, specializes in the development and sale of innovative software solutions. On January $1$st$,2015,$ the company acquired a state$-$of$-$the$-$art manufacturing facility for R$5$ million to support its operations and drive business growth. The asset, consisting of machinery and equipment, was expected to contribute to the company's production capacity and generate operational income over its useful life of $10$ years.

On July $1$st$,2018,$ Lucid Limited conducted an impairment assessment of the asset in accordance with accounting standards. The assessment was prompted by changes in market conditions and performance indicators that indicated a potential impairment loss. The fair value of the asset on July $1$st$,2018,$ was determined to be R$3\mathrm{.}8$ million, based on a valuation conducted by independent appraisers. The valuation took into account market conditions, comparable sales data, and the condition and utility of the asset. Additionally, the cost to sell the asset was estimated at R$800,000,$ considering transaction costs and fees associated with the disposal of the asset.

In addition to assessing the fair value of the asset, Lucid Limited also evaluated its value in use, which represents the present value of expected future cash flows generated by the asset. The value in use of the asset was estimated to be R$2\mathrm{.}95$ million, based on discounted cash flow projections and assumptions about future revenues, expenses, and discount rates.

After comparing the fair value and value in use of the asset to its carrying amount, Lucid Limited determined that an impairment loss was required. The carrying amount of the asset on July $1$st$,2018,$ was R$5$ million, which exceeded both the fair value of R$3\mathrm{.}8$ million and the value in use of R$2\mathrm{.}95$ million.

Required:

Determine whether the asset is impaired, and the causes and impact of impairment on financial statements under IAS $36.$ Justify your answer with calculations and an explanation.

Critically analyze recent developments or changes in accounting standards related to impairment testing and recognition. What implications do these changes have for companies, auditors, and regulators in ensuring accurate and reliable financial reporting?

Propose recommendations for improving impairment testing practices and enhancing transparency and accountability in financial reporting. How can companies enhance the effectiveness of impairment assessments and provide more meaningful disclosure to stakeholders?