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IFRIC 10 - Interim Financial Reporting and Impairment


IFRIC 10 deals with the interaction between on the one hand the requirements in IAS 36 and 39 concerning the reversal of impairment provisions and on the other hand the requirements of IAS 34.  

  • IAS 36 requires, inter alia, that impairment losses on acquired goodwill should be recognised if the acquired goodwill is deemed to have been impaired and that the provision for those losses shall not be reversed in a subsequent period, regardless of circumstances. IAS 39 contains similar provisions relating to investments in available-for-sale equity instruments and unquoted equity instruments that are not carried at fair value because their fair value cannot be reliably measured.  
  • IAS 34 requires that an entity shall apply the same accounting policies in its interim financial statements as are applied in its annual financial statements and that the frequency of an entity's reporting (annual, half-yearly, or quarterly) shall not affect the measurement of its annual results. To achieve that objective, measurements for interim reporting purposes shall be made on a year-to-date basis. That in turn means that, if an impairment is recognised and measured in one interim period and the estimate changes in a subsequent interim period of that financial year, the original estimate is changed in that 2 subsequent period either by accrual of an additional amount of loss or by reversal of the previously recognised amount.

On 6 April 2006 EFRAG published its comment letter and on 20 December 2006 EFRAG published its Endorsement Advice to the European Commission (documents can be below).

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