For a depreciable asset, when the cost model is adopted under AASB 116, it is impossible for the full amount of impairment recognised in earlier reporting periods to be reversed in subsequent reporting periods.

Question

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Under AASB 116, the cost model is used for depreciable assets. Once an impairment loss is recognized, it cannot be reversed in subsequent periods, even if the fair value of the asset increases.

For a Depreciable Asset, When the Cost Model Is Adopted