itemized carry forward method

我的题目是：The usage of impairment model in subsidiary’s financial statement under the partial closing concept

Introduction

The partial closing concept is based on a legal process as well as an accounting technique to settle the financial issues within an organization or between a parent company and a subsidiary. The idea behind the partial closing concept is to separate certain divisions, departments, or subsidiaries and merge them together, maintaining the financial records of each but transferring the balance from one to the other. In corporate accounting, this concept has to be accounted for in accordance with the generally accepted accounting principles. This concept has been accepted by the International Accounting Standards Board (IASB), which sets out certain financial reporting requirements.

Partial closing can be used to prepare a separate financial statement for a group of companies, or to close and restate the financial statements of a single subsidiary. In the partial closing concept, the parent and the subsidiary will close and restate their respective books of accounts to recognize and reflect the transactions that have occurred while they were legally and accounting separate. This requires the parent and the subsidiary to record the transactions of the subsidiary in the parents financial statements and to recognize the differences, if any, between the parent and the subsidiary. The financial statements thus prepared will then be audited and certified by an independent auditor.

The partial closing concept is also used to account for any difficulties encountered by a subsidiary in the course of its accounting processes. To do this, an impairment model is used. The objective of this impairment model is to calculate the amount of capital that should have been reported as impairment losses, given the current conditions of the subsidiary and its future financial obligations. This is done by comparing the carrying amount of the assets to their recoverable amount. The recoverable amount of the asset is the present value of the estimated future cash flows generated by the asset. If the carrying amount of the asset is greater than its recoverable amount, impairment loss is recognized.

Conclusion

In conclusion, the partial closing concept is a useful technique for organizations and businesses that operate with multiple subsidiaries or divisions. The IASB has approved this concept which is to be followed according to the generally accepted accounting principles. An impairment model is used in the partial closing concept to calculate the amount of impairment losses, if any, when dealing with a subsidiary that is facing difficulties in its operations. The impairment model determines the recoverable amount of the assets and compares them to the carrying amount of the assets. By doing so, the impairment loss is recognized if the carrying amount of the assets exceeds its recoverable amount. This ensures that any impairment losses of the subsidiary are being accounted for properly.

The method of transferring capital items is a method used by companies to transfer the costs of an asset from one accounting period to the next. The transfer of these costs is called a capital item transfer, and is used to spread the costs of an asset over its useful life.

Capital item transfers are necessary because some assets are too expensive to expense in one accounting period. For example, items such as machinery, buildings and long-term leases are typically too expensive to expense in one accounting period.

The most common method for transferring capital items is the capital item transfer method. Under this method, the cost of an asset is spread over its expected useful life. The cost of the asset is divided by the number of accounting periods during which it is expected to be used. This amount that is recorded as an expense in the current period is then added to the capital account.

At the end of each accounting period, the amount of the capital item transfer is subtracted from the capital account and added to the balance of the income statement. This results in the cost of the asset being spread over the expected life of the asset.

Capital item transfers are an important concept in accounting and are used by companies to spread the cost of an asset over its life. It is important for companies to use the capital item transfer method correctly to ensure that their books are accurate and that the costs of their assets are recorded correctly.