The importance of applying impairment of fixed assets standards and the obstacles that limit its application: field study on industrial companies operating in Basra

Jalil Ibrahim Salih

International Journal of Business Excellence, 2021, vol. 25, issue 3, 334-344

Abstract: Accounting thought has only been concerned with the impairment of fixed assets in the early 1990s as there was lack of awareness and knowledge of the phenomenon before, with the calculated depreciation premium of the fixed asset considered to be sufficient to cover the shortfall in asset value as a result of its frequent use. This research aims to identify the extent to which industrial companies operating in Basra governorate apply the accounting standard no. 36 related to the fixed assets' impairment as well as to identify the obstacles and challenges that limit the application of such standard related to the fixed assets' impairment by operating companies in Basra. To achieve the goals of the study, a pilot sample was conducted where 102 questionnaires were distributed, among which 86 were returned, acquiring a response rate of 84%. The pilot study included employees working in industrial companies operating in Basra, Iraq. The study revealed a group of results, the most important of which is that industrial companies operating in Basra do not apply the accounting standard no. 36 related to the fixed assets impairment.

Keywords: fixed assets; industrial companies; accounting standard; obstacles; industrial companies; Basra. (search for similar items in EconPapers)
Date: 2021
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