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IAASA publishes “Desktop survey – Impairment testing in Irish listed companies’ 2016/17 annual financial statements”

IAASA, Ireland’s accounting enforcer, has today published the results of a desktop survey it has undertaken into Irish listed companies’ impairment testing.

IAASA’s Paper is available here.


Companies recognise substantial goodwill and intangible assets in their accounts. Accounting standards require that such assets be tested annually for impairment and, if applicable, the assets must be reduced to their recoverable amount and an impairment loss is recognised. The non-amortisation of goodwill and indefinite life intangible assets increases the reliance that users must  place on the impairment tests conducted by the companies holding such assets.

Our survey examined the 2016/17 annual financial statements published by twenty-nine companies.

Survey results

The key findings from our desktop survey were:

  • just four business sectors (building materials & construction, food & ingredients, paper, packaging & containers, and sales, marketing & business support) recognised 90% (€22.4 billion) of that total goodwill and intangible assets;

Areas for improvement identified

Our desktop survey found that the impairment disclosures made by a significant minority of the companies showed a combination of:

Examples of high quality disclosures identified

Our survey also found instances of high quality disclosures of the impairment testing processes undertaken by some of the companies, including examples where companies had clearly presented disaggregated disclosures at a ‘significant’ business unit level.

We also identified instances where companies provided more than the minimum disclosures required by accounting standards (e.g. quantitative disclosures of changes to key assumptions were disclosed where not strictly required).

Future IAASA actions

The results of our findings from this desktop survey, which are consistent with those from a similar Europe-wide survey will be used to inform our future accounting enforcement activities.

This survey was limited to a desktop examination of the companies’ 2016/17 financial statements. We did not seek or receive explanations from the companies concerned. Due to the inherent limitations of such a desktop survey, it could not assess why certain disclosures were omitted by some companies or on what basis the presentation was deemed appropriate by the companies.