Disposal Of Discontinued Operations

Question 1

Disclosure requirement for disposal

Answer 1

1. Facts why discontinued
2. Manner and timing of disposal
3. G/L on disposal
4. Where to report G
5. If HFS asset record separately on BS
6. Segment asset belong to

Question 2

Why discontinued operations happened?

Answer 2

Disposal represent the strategic shift that will impact the entity’s operation

I.e. Disposal of geo area
Line of business

Question 3

Record disposal assets sold in IS as

Answer 3

Net of tax in discontinued operation

EPS is calculated

Question 4

Is there any comparison for prior year operating results if current year disposal will happen?

Answer 4

Yes. Say for 2015 disposal, need to record 2013 and 2014 operating results in discontinued operating section for comparison purpose

Following consistency principle

Question 5

Disposal group of asset held for sale is remeasured at the lower is CV or FV less cost to sale, G/L is in discontinued operations

Answer 5

All prior year balance is readjusted into continue operations assets and disposal assets

Question 6

Differences of discontinue and decision happen in the same period

Happen in different period

Answer 6

Same period: easy case, no estimated

Different periods :

Need to make estimates disposal loss and recognize in fs, NO estimated GAIN will be recognized

If the actual loss is different from estimates, the loss is record in next year’s discontinued operation section.

Question 7

IFRS and gasp difference on disposal is discontinued operations?

Answer 7

Us: compatible bs is restated

Int’l: not restated