arvonalennuksella

Arvonalennuksella refers to a financial accounting concept representing a reduction in the book value of an asset when its recoverable amount falls below its carrying amount. This occurs when the economic benefits expected from an asset are no longer likely to be as high as initially anticipated. Recoverable amount is defined as the higher of an asset's fair value less costs to sell or its value in use. Value in use is the present value of the future cash flows expected to be derived from an asset.

When an impairment loss is recognized, it is typically recorded as an expense in the income statement, thereby reducing net income. The carrying amount of the asset on the balance sheet is then adjusted downwards to reflect its new, lower recoverable amount. This accounting treatment ensures that assets are not overstated on the financial statements. Companies are required to assess their assets for impairment indicators at each reporting period. If indicators are present, a formal impairment test must be performed. Reversals of impairment losses are generally not permitted, except in specific circumstances for certain types of assets, such as those held for sale. The recognition of an arvonalennuksella can have a significant impact on a company's financial performance and position.