"IFRS 5 Non-current Assets Held for Sale and Discontinued Operations"

IFRS 5, titled "Non-current Assets Held for Sale and Discontinued Operations," is an International Financial Reporting Standard issued by the International Accounting Standards Board (IASB). IFRS 5 provides guidance on the accounting treatment and presentation of non-current assets held for sale and the classification and disclosure of discontinued operations in an entity's financial statements.

Key points and objectives of IFRS 5 include:

1. Scope: IFRS 5 applies to all non-current assets, including disposal groups (assets and liabilities) held for sale, and to all discontinued operations. A discontinued operation is a component of an entity that has been disposed of or is classified as held for sale.

2. Non-current Assets Held for Sale: IFRS 5 establishes criteria for classifying non-current assets as held for sale. When these criteria are met, the assets are measured at the lower of their carrying amount and fair value less costs to sell. Depreciation ceases for these assets.

3. Presentation of Discontinued Operations: The standard requires the presentation of discontinued operations separately in the income statement. A discontinued operation is reported as a single amount, comprising the post-tax profit or loss and the post-tax gain or loss recognized on the measurement to fair value less costs to sell or on the disposal of the assets or disposal group.

4. Disclosure: IFRS 5 sets out disclosure requirements related to non-current assets held for sale and discontinued operations. Entities are required to provide information that helps users of financial statements understand the nature and financial effects of these items.

5. Measurement: Non-current assets held for sale are measured at the lower of their carrying amount and fair value less costs to sell. Any impairment losses are recognized immediately in profit or loss.

6. Timing of Classification: Classification of assets as held for sale and presentation as discontinued operations should occur when the criteria are met. Assets held for sale should be presented separately in the balance sheet.

The primary objective of IFRS 5 is to provide guidance on the proper accounting treatment and presentation of non-current assets held for sale and discontinued operations. It aims to ensure that these items are accounted for transparently and separately in the financial statements to provide users with relevant information about the entity's financial performance and position.

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