CAF-8 · Chapter 8 · Question 9 of 10
Which of the following would lead an auditor to suspect that a non-current asset is 'Impaired'?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) The asset is significantly damaged, or its market value has dropped drastically due to technological obsolescence.
Explanation
Physical damage, obsolescence, or a significant decline in market value are key 'indicators of impairment' that require a formal impairment test under IAS 36.
More Substantive Procedures: Non-Current Assets MCQs
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- Q2To test the 'Existence' assertion for a new, expensive piece of manufacturing machinery, which procedure is most effective?
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- Q5Which procedure addresses the 'Completeness' assertion of non-current assets?