Can the provision for impairment of fixed assets be reversed?

If the recoverable amount of a fixed asset is lower than its book value, the enterprise shall make an impairment provision for the fixed asset according to the difference between the recoverable amount and the book value, and include it in the current profit or loss, which can be reversed; If there is an indication that the factors on which the impairment of a fixed asset is based in previous periods have changed, so that the recoverable amount of the fixed asset is greater than its carrying amount, the provision for impairment shall not be reversed.

According to the relevant provisions of China's "Accounting System for Business Enterprises" and "Accounting Standards for Business Enterprises - Fixed Assets", the formula for making provision for impairment of fixed assets is: provision for impairment of fixed assets, book value, recoverable amount. The book value data is readily available, and the recoverable amount should be the higher of the net sales price and the present value of future cash flows.

Therefore, the method of determining whether a fixed asset is impaired mainly relies on the determination of the net sales price or the present value of future cash flows.

It is incomplete to determine whether a fixed asset is impaired by the net sales price method, which rarely considers the present value of its future cash flows. The main purpose of the enterprise to purchase fixed assets is to use it for production and operation and expect to continuously generate the inflow of economic benefits in the future, rather than to obtain the price difference for the purpose of using it.

1. The provision for impairment of fixed assets cannot be reversed. For non-current assets, if the fair value is not easy to obtain, the impairment provision shall not be reversed once it is accrued. Including fixed assets, intangible assets, long-term equity investment, etc.

2. The recoverable amount of a fixed asset is lower than its book value due to damage, obsolescence or other economic reasons, which is called impairment of fixed assets. If the recoverable amount of a fixed asset is lower than its book value, an impairment provision shall be made for the difference between the recoverable amount and its book value, and shall be included in the profit or loss for the current period.

3. If the recoverable amount of fixed assets is lower than its book value, the enterprise shall make provision for impairment of fixed assets according to the difference between the recoverable amount and the book value, and calculate the profit or loss for the current period; When the depreciation amount of fixed assets is adjusted due to the provision for impairment of fixed assets, no adjustment shall be made to the accumulated depreciation previously accrued;

4. If there is an indication that the factors on which the impairment of fixed assets were accrued in previous periods have changed, so that the recoverable amount of fixed assets is greater than their book value, the provision for impairment shall not be reversed. The provision for impairment of fixed assets is not directly related to the operation and management of the enterprise, and the situation of impairment does not occur frequently, so when the provision for impairment is made, the account of "asset impairment loss - impairment loss of fixed assets" is debited and the account of "provision for impairment of fixed assets" is credited. In subsequent accounting periods, if all or part of the indication of impairment of fixed assets disappears, the provision for impairment that has been made shall not be reversed.

Once the impairment loss of fixed assets is recognized, it cannot be reversed in subsequent accounting periods.

The accounting entries for the provision for impairment of fixed assets are:

Borrow: Provision for impairment of fixed assets for asset impairment losses.

Credit: Provision for impairment of fixed assets.

1. Tradable financial assets can be reversed.

2. The investment can be reversed when it is held to maturity.

3. Accounts receivable and loans can be reversed.

4. The financial assets available for ** can be transferred back. (If it is a financial asset that is available for investment, it is not reversed through profit or loss).

5. Inventory impairment: It can be reversed, and if the products that have been impregnated for impairment have been sold, the impairment that has been accrued should be carried forward at the same time.

6. Deferred income tax assets: can be reversed (subject to certain conditions).

The recoverable amount of a fixed asset at the balance sheet date is less than its book value.

Enterprises should write down the book value of fixed assets to the recoverable amount, and at the same time recognize them as asset impairment losses, and make provision for impairment of fixed assets.

Once the impairment loss on fixed assets is recognized, it will be in the subsequent accounting period.

No reversal.

The asset impairment provision can be reversed as follows:

Tradable financial assets can be reversed; Held-to-maturity investments can be reversed; Accounts receivable and loans can be reversed; Available for ** financial assets can be reversed. (If it is available for investment in **financial assets** and is not reversed through profit or loss), inventory impairment: it can be reversed, and if the product that has been impregnated for impairment has been sold, the impairment that has been accrued should be carried forward at the same time; Deferred tax assets:

It is possible to turn back (subject to certain conditions).

Accounting for reversal of asset impairment provisions:

1. This account accounts for the losses caused by the provision for impairment of various assets in accordance with the criteria of asset impairment.

2. This account shall be accounted for in detail according to the items of asset impairment losses.

3. If an enterprise determines the impairment of assets according to the criteria of asset impairment, this account shall be debited according to the amount to be written down, and the "provision for bad debts", "provision for inventory decline", "provision for impairment of investment in Huaiwu long-term shares", "provision for impairment of held-to-maturity investment" and "provision for impairment of fixed assets" shall be credited.

Construction in progress - impairment provision", "Engineering materials - impairment provision", "Productive biological assets - impairment provision", "Intangible assets impairment provision", "Goodwill - impairment provision", "Loan loss provision", "Debt assets - impairment provision", "Surplus materials - impairment provision" and other accounts.

Fourth, the value of the relevant assets must be restored after the enterprise has made provisions for bad debts, inventory declines, impairment provisions for held-to-maturity investments, and quasi-forward provisions for loan losses.

Within the amount of impairment provision that has been originally accrued, the accounts of "provision for bad debts", "provision for decline in value of inventory", "provision for impairment of held-to-maturity investments", "provision for loan losses", "provision for depreciation of assets against debts", "provision for decline in value of surplus materials" and other accounts shall be debited and credited to this account according to the amount of the increase in recovery.

5. At the end of the period, the balance of this account should be transferred to the "profit of the year" account, and there is no balance in this account after the carryover.

The provision for impairment of fixed assets can be reversed if it is not clear. According to the provisions of Accounting Standards for Business Enterprises No. 8 - Asset Impairment, once the impairment loss of fixed assets of an enterprise is recognized, it cannot be reversed in subsequent accounting periods.

Accounting for the disposal of fixed assets:If an enterprise transfers or scraps fixed assets or damages fixed assets, the disposal income after deducting the book value and relevant taxes and fees shall be included in the current profit or loss. The carrying amount of a fixed asset is the amount of the cost of the fixed asset after deducting the accumulated depreciation and the accumulated impairment provision.

The impairment provision of fixed assets cannot be reversed.

Some long-term impairment provisions cannot be reversed, mainly including long-term equity investment impairment provisions, fixed asset impairment provisions, intangible assets impairment provisions, construction in progress impairment provisions, engineering materials impairment provisions, productive biological assets impairment provisions, goodwill impairment provisions, and investment real estate impairment provisions using the cost model for subsequent measurement.

Some short-term impairment or depreciation provisions can be reversed, mainly including inventory depreciation provisions, bad debt provisions, debt investment impairment provisions, consumable biological assets depreciation provisions, unsecured residual value impairment provisions, surplus materials depreciation provisions, deferred income tax asset impairment provisions, long-term receivables - financial lease receivables, etc.

Fixed asset disposal method:

1. The gains or losses arising from scrapping and cleaning due to the loss of use function or damage due to natural disasters shall be included in the non-operating income and expenditure.

2. The gains or losses on the disposal of fixed assets arising from **, transfer and other reasons shall be included in the profit or loss on asset disposal.

3. The net profit and loss of scrapping and disposal shall be included in the non-operating income and expenditure, which will not affect the operating profit.

4. **The net profit and loss from the transfer is included in the profit and loss on the disposal of the company, which affects the operating profit.

Summary. Once the impairment loss of fixed assets is recognized, it cannot be reversed in subsequent accounting periods.

Dear, glad to answer for you. Can the impairment provision for fixed assets be reversed? The provision for impairment of fixed assets cannot be reversed.

If the recoverable amount of fixed assets of an enterprise at the balance sheet date is lower than its book value, the enterprise should write down the book value of the fixed assets to the recoverable amount, and at the same time recognize it as an asset impairment loss, and make provision for the impairment of fixed assets.

Once the impairment loss of fixed assets is recognized, it cannot be reversed in subsequent accounting periods.