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  3. 0 1 3 dap11.1 in 2014 and 2015, as the price of a

0 1 3 DAP11.1 In 2014 and 2015, as the price of a barrel of...

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Accounting

0 1 3 DAP11.1 In 2014 and 2015, as the price of a barrel of oil dropped by more than 50%, many companies in the industry recorded large impairment charges. For instance, Husky Energy Inc. reported a non-cash, pre-tax, impairment charge of $5.0 billion in 2015 on its Western Canada oil and natural gas assets, as a result of forecasted decreases in both short- and long-term crude oil and natural gas prices, as well as the company's plan to reduce capital investment in those areas. Unfortunately, a global impact again in 2020 saw a similar downturn. This time, Husky recorded a pre-tax impairment charge of $8.9 billion that "was primarily the result of the market impact from the COVID-19 pandemic, which has resulted in declines in forecasted long-term commodity prices..." The impact of impairment charges is not limited to the income statement. Often such impairment charges match a similarly steady decrease in a company's share price. It is probably not a coincidence then that the large increases in impairment exp

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