Kvalitet i forbindelse med nedskrivningstests for regnskabsbruger under en økonomisk krise

Johann Hedelund Jørgensen & Christian Egholm Vohnsen

Student thesis: Master thesis


This thesis deals with a theoretical discussion and analysis of how we ensure a high quality for the user of a financial statement with a focus on impairment tests under IAS 36 during an economic crisis. There is an expectation gap between the user, the accountant and the auditor. This is to some extent because of the parties' different views on what quality is. An empirical study by FSR establishes quality dimensions, which we collate and analyze in relation to the quality dimensions derived from relevant literature. Through a discussion of Limperg and Mautz & Sharaf's fundamental revision theories, we find that the formation of expectations for quality should be based on the user. The dimensions of quality, which the user priorities higher than the accountant and the auditor are "industrial expertise", "critical towards the auditee" and "transparancy". IAS 36 provides international requirements for the preparation of impairment tests. Assets covered by IAS 36 should be measured as recoverable amount if this is lower than the carrying amount. The recoverable amount is the higher of either the fair value less costs to sell, or the value in use. Calculation of recoverable amount is complex, requiring accountability from the accountant, as well as the auditor. Economic crises can have a significant influence on the result of impairment tests. Hence, companies constantly need to update the variables used, in response to changes in the companies' context. An empirical study of the development of the level of WACC shows a delay from the companies' side in the current economic crisis. Impairment tests must be prepared properly, taking into account the relevant assumptions etc., which apply to ensure the quality of financial statements in relation to the user. The economic crisis has led companies to operate under increased pressure, which may lead to fraudulent financial reporting of impairment tests, for example in relation to covenant and bonus targets. The discussion of manipulation of impairment tests shall contribute to increased future focus on this issue, as the manipulation will affect the quality of the financial report negatively for the user.

EducationsMSc in Auditing, (Graduate Programme) Final Thesis
Publication date2012
Number of pages125