NCA HFS

Which of the following statements is incorrect?

• PFRS 5 specifies that assets or disposal groups that are classified as held for sale are carried at fair value less costs to sell.

• PFRS 5 specifies that an asset classified as held for sale, or included within a disposal group that is classified as held for sale, is not depreciated.

• PFRS 5 specifies that an asset classified as held for sale, and the assets and liabilities included within a disposal group classified as held for sale, are presented separately in the statement of financial position.

• PFRS 5 specifies that assets classified as non-current in accordance with PAS 1 Presentation of Financial Statements shall not be reclassified as current assets until they meet the criteria to be classified as held for sale in accordance with this PFRS.

Which of the following assets is outside the scope of PFRS 5?

• Property, plant and equipment

• Investment property carried under the Cost model

• Deferred tax assets

• Intangible assets

Assets which are previously classified as non-current in accordance with PAS 1 Presentation of Financial Statementswhen they meet the criteria to be classified as held for sale are to be presented separately on the face of the balance sheet and included as

• Non-current asset

• Current asset

• Neither current nor noncurrent

• Either current or noncurrent

An entity shall classify a non-current asset (or disposal group) as held for sale when

• the non-current asset’s (or disposal group’s) carrying amount will be recovered principally through continuing use rather than through a sale transaction.

• the non-current asset’s (or disposal group’s) carrying amount will be recovered principally through a sale transaction rather than through continuing use.

• the non-current asset (or disposal group) has actually been disposed of.

• the non-current asset (or disposal group) is abandoned or taken out temporarily from use.

A non-current asset or a disposal group shall be classified as held for sale if which of the following conditions are met.

I. the asset or disposal group must be available for immediate sale in its present condition subject only to terms that are usual and customary

II. the sale must be highly probable

• I only

• II only

• I and II

• I or II

A non-current asset or a disposal group shall be classified as held for sale if the asset or disposal group is available for immediate sale in its present condition subject only to terms that are usual and customary and the sale is highly probable. Sale is highly probable if

I. an appropriate level of management is committed to a plan to sell the asset

II. an active program to locate a buyer and complete the plan will yet to be initiated

III. the asset or disposal group must be actively marketed for sale at a price that reflects a reasonable profit

IV. the sale (or exchange with commercial substance) should be expected to qualify for recognition as a completed sale within two years from the date of classification

V. actions required to complete the plan should indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn:

• I, V

• I, II, V

• I, II, III, V

• I, II, III, IV, V

When an entity acquires a non-current asset (or disposal group) exclusively with a view to its subsequent disposal, it shall classify the non-current asset (or disposal group) as held for sale at the acquisition date only if the one-year requirement is met and it is highly probable that the other criteria as provided in PFRS 5 will be met within

• 12 months after balance sheet date

• 12 months from date of acquisition

• 6 months from date of acquisition

• 3 months from date of acquisition

A non-current asset (or disposal group) classified as held-for-sale should be measured at

• acquisition cost plus necessary costs

• at depreciated cost

• at the lower of carrying amount and fair value

• at the lower of carrying amount and fair value less cost to sell

An entity has a non-current asset that has been classified as held-for-sale but the asset no longer meets the criteria to be held for sale. The entity should, therefore

• leave the non-current asset in the financial statements at its current carrying value

• measure the non-current asset at the lower of its carrying amount before its asset was classified as held-for-sale (as adjusted for subsequent depreciation, amortization, or revaluations) and its recoverable amount at the date of the decision not to sell

• re-measure in accordance with applicable PFRS

• re-measure the non-current asset at fair value

Any gain or loss on the remeasurement of a non-current asset (or disposal group) classified as held for sale that does not meet the definition of a discontinued operation shall be included

I. in profit or loss from continuing operations

II. in profit or loss from discontinued operations

III. adjustment to the beginning balance of retained earnings

• I only

• Either II or III

• Either I or III

• Either I, II or III