 First of all we look into the objective learning outcomes. Students will be able to understand what constitute impairment of assets as per IES 36, able to identify events when impairment of assets occurs. Now those can be internal and there can be external. Learn how to present and disclose impairment of assets in financial statement, both in income statement and balance sheet. Now first of all the objective, IES 36 prescribes the procedures that should be followed by an entity to ensure that its assets are not held more than their recoverable value. So do remember here two words, recoverable value and carrying value. So these we have to discuss in detail what is a recoverable value. The standard gives the rules for written down assets for impairment and also the circumstances when impairment can and should be reversed. So sometime there is a reduction in the value of assets and sometime it happens that after the reduction it happens sometime that they can be reversed means their value can increase. So we will look into that. Long-lived assets is impaired when a company is not able to recover the assets carrying amount either through use it or by selling it. Two things, either you are using it and generating revenue out of it or you are selling it. So you will see if you are not recovering your carrying value it means the asset is being impaired. To determine whether an asset is impaired on an annual basis and not necessarily all the time on annual basis may be 2-3 years time but you must select after how many years we need to test whether the asset is impaired or not. And the indicators of improvements that is declined in the assets cash generating ability through use or sale. If impairment indicators like internal and external let me just explain you about internal and external. Internal normally when we are using an assets they are depreciating. Sometime they become obsolete or sometime it happens that the asset which you bought for a certain purpose that purpose is not being fulfilled. So that is internal. In external maybe some legal restriction somewhere or maybe change in technology. So that assets may not be that important now or that not generating enough revenue for the company. So those factors are many actually but these are few I have mentioned that if those factors are there then you see that the assets are being impaired. Now if carrying value is greater than recoverable value the difference is impairment loss. So let's see assets must not be carried on the balance sheet at more than their recoverable amount. So first of all let's see what is this recovery. Recovery can be to sell an asset or generate cash flow. Now it is used to provide service and generate cash flow and this is value in use. So one thing is carrying value other is recoverable value. Recoverable value is basically two things here we have to see one that how much cash flow it generates during the life of the assets or for future use of the assets and if we want to sell it how much money we are going to recover out of it. So we have to compare sales and the value in use. Sale means sale after taking out any expense if you want to sell it. If the asset is on the balance sheet at a figure is more than the amount that can be recovered from it it is clearly impaired. We need to write down of its value and it is like an extra depreciation of an asset. You know once you see that the assets carrying value is greater the reason is because of that those factors which undermine the assets utilization or maybe due to passage of time assets becoming slightly obsolete. So we need to compare what is going to be the recoverable value. The value which you can obtain either by selling it or by using it for the next few years. So when we compare the two we need to select the highest the greater value and then compare with the carrying value. So we will see the illustration and inshallah next slide we can see the illustration also.