Non-current assets held for sale – IFRS 5

Non-current assets held for sale and discontinued operations must be disclosed separately in the financial statements.

Assets held for sale
Non-current assets are reclassified as current assets when they are held for sale. A non-current asset is regarded as ‘held for sale’ if its carrying amount will be recovered principally through a sale transaction, rather than through continuing use. To be classified as a non-current asset held for sale:

• the asset must be available for immediate sale; and
• the sale must be highly probable.This requires management commitment to sell, active marketing at a reasonable price, and the expectation of a completed sale within one year.

Assets that are to be abandoned are not classified as held for sale.

Non-current assets held for sale are not depreciated. They are measured at the lower of fair value less costs to sell and carrying amount and presented separately in the statement of financial position.

Discontinued operations
A ‘discontinued operation’ is a component of an entity that either has been disposed of or is classified as held for sale. The component must be a major line of business, a geographical area of operations, or a subsidiary that was acquired exclusively for resale.

Discontinued operations are presented separately within profit or loss in the statement of comprehensive income and the statement of cash flows.

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