AASB 136 Impairment of Asset with reference to Myer case

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Accounting Standards & Regulations – 22420 – Spring 2017
1
ASR Assignment 1 (20%)
Background
You are a recent accounting graduate and have been employed in the Financial Reporting Unit of Myer
Holdings Ltd, an ASX listed firm. Preparations are underway for the completion of the general purpose
financial report for the year ended 29 July 2017 and you have been asked by the Chief Financial Officer to
identify any major accounting issues which will need to be considered. Your attention is drawn to a media
release by ASIC on 31 May 2017 (ASIC Media Release 17‐162) and this identifies areas of concern where
attention will be directed in the ASIC surveillance program. Not surprisingly given a recent academic paper1
‘impairment of assets’ receives specific mention.
Required
You are required to prepare a report for the CFO considering whether impairment of assets is an issue
requiring address for the firm. The report should, with reference to AASB 136:
a) With reference to Myer outline what evidence is there that impairment testing of assets is necessary;
b) With reference to Myer outline the processes required to be addressed in determining any asset
impairments that might be necessary
c) With reference to Myer outline the information needed in determining asset impairments
d) Evaluate the flexibility management has available in the determination of asset impairments .
Format
Your assignment must be set out as a report with the four sections (a) (b) (c) (d) clearly shown. You must link
your discussion to relevant accountings standards, including references to specific paragraphs. You must carry
out independent research to complete this assignment and you must cite relevant academic (where relevant)
and practitioner articles that support the material and views you present. Use Harvard style referencing.
Your report must be typed using 12 point font, 1.5 line spacing and 2.5 cm margins on all sides, with a
maximum length of 1300 words (excluding references, executive summary and appendices). You do not need
an introduction or conclusion. State the word count at the beginning of the assignment. Refer to the UTS
Business School Guide to Writing Assignments (link below) on recommendations and suggestions on how to
structure your report. All material (excluding executive summary, references and appendices) over 1300 words
will be disregarded.
https://www.uts.edu.au/sites/default/files/business‐writing‐guide‐2014.pdf

Parts (a), (b), (c) and (d) are each worth 10 marks. In addition, presentation and communication are worth 10
marks combined. This gives a total mark of 50 for the report, which will be converted into a mark out of 20.
Your report should address each of the parts equally. Attached is the marking scheme that will be used in
marking your report. This report is worth 20% of your total subject marks.
1 Bond, D., Govendir, B. & Wells, P. 2016, ‘An evaluation of asset impairments by Australian firms and whether
they were impacted by AASB 136’, Accounting and Finance, vol. 56, no. 1, pp. 259‐288
Accounting Standards & Regulations – 22420 – Spring 2017
2
Attachment: Assignment marking matrix
The criteria and weighting of each criterion used to mark your assignment are listed below:
Well below
acceptable
Below
acceptable
Acceptable
Above
acceptable
Well above
acceptable
Presentation and Communication (10 marks)
Title Page
Title of assignment, subject name, student number and
name is given
Body/Discussion
Body is organised into main sections and sub‐sections
Sections and sub‐sections have appropriate headings
Report organisation suits requirements
Main issues relevant to the topic are explained
Other
Report is the correct length
Correct formatting (i.e. font/spacing)
Tables/graphs are used correctly (if appropriate)
Writing Style
Information flows logically; Report is easy to follow
Paragraphs are well constructed
Grammar
Sentence structure is grammatically correct
Tenses are used correctly and spelling is correct
Referencing
Statements made in‐text are referenced
In‐text reference format is correct
End‐text references format is correct
Content (40 marks)
Part A (10 marks)
Evidence of asset impairment being necessary is
identified and discussed.
Part B (10 marks)
Processes for determining asset impairments identified
and discussed
Part C (10 marks)
Information needed to determine asset impairments is
identified and discussed.
Part D (10 marks)
Flexibility management has in recognising asset
impairments is identified and discussed.

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