The challenges related to the implementation of impairment tests at the end of FY2020
“Les difficultés liées à la mise en place des tests de dépréciation à la fin de l’exercice annuel 2020”, by Blanche FEAUVEAUX – published in Option Finance n°1593 on February 8, 2021
After 2020 being strongly impacted by the Covid-19 crisis, companies face the challenge of implementing their impairment tests in a time of economic uncertainty which strongly complicates the determination of the fair value of an asset.
In this particular context, correctly identifying what can be considered as an external or internal indicator of impairment, choosing the best approach to define the fair value of the assets tested, but also accurately managing the information to the shareholders are key to undertaking impairment testing.
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