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Writing off impaired long‐lived assets: Discussion memorandum outlines options
Author(s) -
Sylvestre Anne Jeannette,
Strobel Caroline D.
Publication year - 1992
Publication title -
journal of corporate accounting and finance
Language(s) - English
Resource type - Journals
eISSN - 1097-0053
pISSN - 1044-8136
DOI - 10.1002/jcaf.3970030309
Subject(s) - memorandum , accounting , comparability , credibility , consistency (knowledge bases) , business , memorandum of understanding , financial accounting , actuarial science , political science , accounting information system , computer science , law , mathematics , combinatorics , artificial intelligence
In recent years, the selective write‐downs of impaired long‐lived assets has reduced the credibility, comparability, and consistency of financial reporting. In December 1990, the Financial Accounting Standards Board (FASB, or the Board) issued a Discussion Memorandum (DM) to solicit comments on related issues and to develop a consensus on the standards to be used in determining when and how the value of impaired assets should be written down. It is expected that the Board's project on the impairment of long‐lived assets will ultimately result in one or more Statements of Financial Accounting Standards. This article provides a brief discussion of prior and current accounting practices regarding the impairment of long‐lived assets and explores each of the issues identified in the Discussion Memorandum.