ACCOUNTING The company controller, Barry Melrose, has asked for your help in interpreting the authoritative accounting literature that addresses the recognition and measurement of impairment losses for property, plant, and equipment and intangible assets. “We have a significant amount of goodwill on our books from last year’s acquisition of Churchill Corporation. Also, I think we may have a problem with the assets of some of our factories out West. And one of our divisions is currently considering disposing of a large group of depreciable assets.” Your task as assistant controller is to research the issue. Required: 1. Obtain the relevant authoritative literature on accounting for the impairment of property, plant, and equipment and intangible assets using the FASB Accounting Standards Codification. You might gain access at the FASB website (asc.fasb.org). Cite the reference locations regarding impairment of property, plant, and equipment and intangible assets. 2. When should property, plant, and equipment and finite-life intangible assets be tested for impairment? 3. Explain the process for measuring an impairment loss for property, plant, and equipment and finite-life intangible assets to be held and used. 4. What are the specific criteria that must be met for an asset or asset group to be classified as held-for-sale? What is the specific citation reference from the FASB Accounting Standards Codification that contains these criteria? 5. Explain the process for measuring an impairment loss for property, plant, and equipment and finite-life intangible assets classified as held-for-sale. ACCOUNTING Irish Imports is an importer of silver, brass, and furniture items from Ireland. Kathleen O’Shea is the general manager of Irish Imports. O’Shea employs two other people in the business. Molly Fitzpatrick serves as the buyer for Irish Imports. In her work, Fitzpatrick travels throughout Ireland to find interesting new products. When Fitzpatrick finds a new product, she arranges for Irish Imports to purchase and pay for the item. She helps the Irish artisans prepare their invoices and then faxes the invoices to O’Shea in the company office. O’Shea operates out of an office in Boston, Massachusetts. The office is managed by Maura Riley, who handles the mail, keeps the accounting records, makes bank deposits, and prepares the monthly bank reconciliation. Virtually all of Irish Imports’ cash receipts arrive by mail—from sales made to Target, Pier 1 Imports, and Macy’s. Riley also prepares checks for payment based on invoices that come in from the suppliers who have been contacted by Fitzpatrick. To maintain control over cash payments, O’Shea examines the paperwork and signs all checks. Identify all the major internal control weaknesses in Irish Imports’ system and how the resulting action could hurt Irish Imports. Also state how to correct each weakness.