The Certainty of a CGU-Specific WACC - Estimating Complications of Applying a Company-Wide Discount Rate
Purpose: (1) Determine whether there is an inconsistency between the disclosed WACC and the WACC applied in CGU’s for internal impairment tests, with respect to IAS 36. (2) Determine to what extent companies apply a company-wide WACC internally in all CGU’s, when conducting impairment tests in accordance with IAS 36. (3) Describe and analyse the incentives for companies to apply a company-wide WAC
