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International Financial Reporting Standard (IFRS) 5
Non-current Assets Held for Sale and Discontinued Operations

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International Financial Reporting Standard (IFRS) 5

IFRS 5

Non-current Assets Held for Sale and Discontinued Operations

Issued in March 2004: replaced IAS 35

Recent amendment: by IFRS 3 revised in January 2008

What is a disposal group of assets?
      --> a group of assets
            (1) to be disposed of
            (2) together as a group
            (3) in a single transaction

Non-current assets (or disposal groups)
      --> are classified as held for sale
            if
      --> carrying amount is expected to be recovered
            (1) principally through a sale transaction
            (2) not through continuing use

Non-current assets (or disposal groups) classified as held for sale

      --> reported separately (from other assets)
            in the statement of financial position

Measurement

      Non-current assets (or disposal groups) held for sale are measured
      --> at the lower of (1) and (2):
            (1) carrying amount
            (2) fair value less costs to sell

What is a discontinued operation?

      --> A component of an entity that

            (1) has been disposed of
                  or
            (2) is classified as held for sale

      --> and satisfies one of the following conditions:

            (3) represents
                  a separate major line of business or
                  geographical area of operations

            (4) is part of a single plan to dispose of
                  a separate major line of business or
                  geographical area of operations

            (5) is a subsidiary
                  acquired exclusively for the purpose of resale

Disclosure requirement
      in the statement of comprehensive income

      --> the sum of (1) and (2) is reported as a single amount
            in the statement of comprehensive income

            (1) the profit or loss (post-tax basis)
                  of discontinued operations
            (2) the gain or loss (post-tax basis) recognised on (2a) or (2b):
                 (2a) the measurement to fair value less costs to sell
                 (2b) the disposal of the assets (or disposal groups) of discontinued operation

Disclosure requirements
      either in the notes or in the statement of comprehensive income

      --> an analysis of the sum of (1) and (2), from the previous disclosure requirement

            (3) revenue, expenses and pre-tax profit or loss
                  of discontinued operations
            (4) income tax expense related with (3)

            (5) gain or loss recognised on (5a) or (5b):
                 (5a) the measurement to fair value less costs to sell
                 (5b) the disposal of the assets (or disposal groups) of discontinued operation
            (6) income tax expense related with (5)

      --> net cash flows of discontinued operations
            (attributable to the
            operating, investing and financing activities)

      --> the amount of income from continuing operations and
            the amount of income from discontinued operations
            (attributable to the owners of the parent)