FASB Accounting Standards Codification Study 3

ASC 360-10-45-9 outlines a list of six criteria that an asset must meet in order to be classified as “held-for-sale.” These criteria are listed completely in Exhibit E, and include the following: Management plans to sell the asset; the asset can be sold immediately; the company is actively seeking a buyer; the asset is presumed salable within one year; the asset is reasonably priced; and the company is pursuing these actions with no expectation to change its plan to sell the asset.

ASC 360-10-35-43 discusses the recognition of impairment charges to long-lived assets that are classified as held-for-sale. As presented in Exhibit F, “a long-lived asset (disposal group) classified as held for sale shall be measured at the lower of its carrying amount or fair value less cost to sell.” This section goes on to say that long-lived assets that meet the held-for-sale criteria should not be depreciated.

FASB ASC paragraph 360-10-45-9, Property, Plant, and Equipment - Overall – Other Presentation Matters – Impairment or Disposal of Long-Lived Assets – Long-Lived Assets Classified as Held for Sale – Initial Criteria for Classification as Held for Sale

FASB ASC paragraph 360-10-35-43, Property, Plant, and Equipment - Overall – Subsequent Measurement – Impairment or Disposal of Long-Lived Assets – Long-Lived Assets Classified as Held for Sale – Accounting While Held for Sale

Ibid.