Chapter Two

Fair value measurement and

Impairment

Set By MT 1
 Chapter objective

Understand the fair value measurement and

impairment concept

2
 Chapter outline
2.1. Fair value measurement (IFRS 13)
2.1.1. Definition
2.1.2. Measurement of fair value
2.1.3. Fair value at initial recognition
2.1.4. Valuation methods
2.1.5. Fair value hierarchy
2.1.6. Disclosure
2.2. Impairment (IAS 36)
2.2.1. Definition
2.2.2. Measurement of impairment
2.2.3. Reversal of impairment
2.2.4. Disclosure
3
 Objective of IFRS 13

This Standard:

 Defines fair value

 Sets out in a single IFRS framework for measuring

fair value; and

 Requires disclosures about fair value

measurements
4
 Objective of IFRS 13 …(Cont’d)
 IFRS 13 establish how to measure fair value but it does not
disclose:
 What should be measured
 When to measure
 Where to measure
 However, IFRS 13 applies when another IFRS requires or
permits fair value measurements or disclosures about fair
value measurements

5
 Scope of IFRS 13
IFRS 13
 Applies when another IFRS requires or permits fair value
measurements or disclosures about fair value measurements
 Fair value applied in
 IFRS 3: Business combination
 IFRS 9: Financial instrument
 IAS 16: plant property equipment
 IAS 38: Intangible asset
 IAS 40: Investible property
 IAS 41: Agricultural activity 6
 Scope of IFRS 13…(Cont’d)

 The measurement and disclosure requirements of this Standard

do not apply to the following:
 Share-based payment transactions within scope of IFRS 2
 Leasing transactions accounted for in accordance with IFRS:
16 Leases
 Measurements that have some similarities to fair value but
are not fair value, such as net realizable value in IAS 2
Inventories or value in use in IAS 36 Impairment of Assets.

7
 Scope of IFRS 13…(Cont’d)
 The disclosures required by this Standard are not required for
the following:
 Plan assets measured at fair value in accordance with IAS 19
Employee Benefits;
 Retirement benefit plan investments measured at fair value
in accordance with IAS 26 Accounting and Reporting by
Retirement Benefit Plans; and
 Assets for which recoverable amount is fair value less
costs of disposal in accordance with IAS 36 Impairment of
Assets. 8
2.1. Fair value measurement
2.1.1. Definition
Measurement
 Is the process of determining monetary amounts at which elements
are recognized and carried
 To a large extent financial reports are based on estimates,
judgments and models rather than exact depictions
 The objective of measurement is to select those measurement bases
that most fairly reflect the cost of services, operational capacity and
financial capacity of the entity in a manner that is useful in holding
the entity to account, and for decision making purposes
9
 Fair value measurement…(Cont’d)

Active market

 A market where transactions for the asset or liability

take place with sufficient frequency and volume to

provide pricing information on an ongoing basis

10
 Fair value measurement…(Cont’d)
Entry price
 Refers to the price paid to acquire an asset
or received to assume a liability in an
exchange transaction.
Exit price
 The price that would be received to sell an
asset or paid to transfer a liability.
11
 Fair value measurement…(Cont’d)
Fair value measurement principle
 States that assets and liabilities should be reported at
fair value
 A fair value measurement assumes that the transaction to
sell the asset or transfer the liability takes place either:
i. In the principal market for the asset or liability; or
ii. In the absence of a principal market, in the most
advantageous market for the asset or liability.

12
 Fair value measurement…(Cont’d)

Fair value

The price that would be received to sell

the asset or paid to transfer the liability

13
Fair value measurement…(Cont’d)
 Fair value measurement…(Cont’d)

Characteristics of fair value

 A market value (not entity-specific value)

 An exit value -price received from sale( use ) of asset

 But not acquisition / development/ construction cost

 Reflects all changes that market participants factor into

pricing at the measurement date

15
 Fair value measurement…(Cont’d)
Exit
price

Not a
liquidation Definition Market-
price or of Fair based
forced Value approach
sale

Current
price

 The transaction to sell the asset or transfer the liability takes

place in the principal market for the asset or liability.
 Fair value measurement…(Cont’d)
Principal market
 A market with a greatest volume and level of activity for
sale of a certain assets or liabilities that can be accessed by
the entity
 Thus, a market from which fair value is derived
 If there is no principal market (if the reporting entity does
not have access to the principal market )
 The fair value should be based on the price in the
most advantageous market
17
 Fair value measurement…(Cont’d)

Most advantageous market

The one, which maximizes the amount that

would be received for the asset or minimizes

the amount that would be paid to transfer the

liability after transport and transaction costs.

18
Transaction and transport costs

Cost type Description Include in Explanation

fair value
cost to sell the
Characteristic of
asset/transfer the liability no, but consider in
Transaction that are directly assessment of which the transaction,
attributable to the market is most not of the
cost disposal or transfer and advantageous asset/liability
would not otherwise have
been incurred

yes, if location is a
Transport cost that would be
Characteristic of
incurred to transport an characteristic of the
asset from its current the asset
asset
cost location to its exit market
 Fair value measurement…(Cont’d)

What is bases to value asset or liability?
1. Market value: willing buyer and a willing seller

2. Market rent: willing lessor and a willing lessee

3. Equitable value: knowledgeable and willing parties

4. Investment value/worth: a particular owner or prospective buyer

5. Synergistic value :benefits associated with combining assets

6. Liquidation value: net amount that would be realized if

the business is terminated

 Fair value measurement…(Cont’d)
Market participants
 Are buyers and sellers in the principal market who are:
 Independent
 Knowledgeable
 Diligent
 Use all available information
 Willing to transact for the asset or liability
 Able to transact for the asset or liability

21
 Fair value measurement…(Cont’d)

Independent:

 Market participants are independent of each other, i.e.

they are not related parties, although the price in a

related party transaction may be used as an input to

a fair value measurement if the entity has evidence that

the transaction was entered into at market terms.

22
 Fair value measurement…(Cont’d)

Knowledgeable:

 Market participants are knowledgeable, having a

reasonable understanding about the asset or liability

and the transaction using all available information,

including information that might be obtained through

due diligence efforts that are usual and customary.

23
 Example 1
Price less
Transport Transaction
Market Price costs
transport
costs
Net
costs

A 27 3 24 3 21

B 25 2 23 1 22

Scenario Fair value

If market A is the principal market 24
If market B is the principal market 23
neither market is the principal market 23
 Example 2
Market 1 2

Daily trade volume 100,000 20,000

Price 100 108

Price less transport costs 95 101

Transaction costs 4 4

Net 91 97

Entity A has an access to the two markets

Entity A sells in Market 2
Which Market will determine the fair value in accordance with IFRS 13?
 Solution

 The principal market is market 1 since it has the greatest

volume and level of activity.
 The most advantageous market is market 2 since it has the
highest net proceeds.
 The fair value will be determined in accordance to market 1
since: market 1 is the market with the greatest volume and
level of activity, Entity A has an access to that market
 Therefore, the fair value will be 95.
 Fair value measurement…(Cont’d)
2.1.2. Measurement of fair value
 When measuring fair value of a particular asset or liability an
entity shall take into account the
1. Characteristics of the asset or liability
 The condition and location of the asset; and
 Restrictions, if any, on the sale or use of the asset
2. For non financial asset ; Valuation premises and the highest
best use
3. Market to identify the fair value; Principal ( most
advantageous) 27
 Fair value measurement…(Cont’d)

When measuring fair value of a particular asset or liability an

entity should exclude particulars that are not considered as

characteristics of the asset/ liability:

1. Transaction cost

2. Restrictions on use or sale that are not a characteristics of

the item

28
 Fair value measurement…(Cont’d)

 The asset or liability measured at fair value might

be either of the following:
 A stand-alone asset or liability (e.g. a financial
instrument or a non-financial asset); or
 A group of assets, a group of liabilities or a
group of assets and liabilities (e.g. a cash-
generating unit or a business).

29
 Fair value measurement…(Cont’d)
2.1.3. Fair value at initial recognition
 When an asset is acquired or a liability is assumed in an exchange
transaction for that asset or liability, the transaction price is the
price paid to acquire the asset or received to assume the liability
(an entry price).
 In contrast, the fair value of the asset or liability is the price that
would be received to sell the asset or paid to transfer the liability
(an exit price).
 Entities do not necessarily sell assets at the prices paid to
acquire them.
 Similarly, entities do not necessarily transfer liabilities at
the prices received to assume them. 30
 Fair value measurement…(Cont’d)
 In many cases the transaction price will equal the fair
value (e.g. that might be the case when on the transaction
date the transaction to buy an asset takes place in the market
in which the asset would be sold).
 When determining whether fair value at initial
recognition equals the transaction price, an entity
shall take into account factors specific to the
transaction and to the asset or liability.
 If another IFRS requires or permits an entity to measure an
asset or a liability initially at fair value and the transaction
price differs from fair value, the entity shall recognize the
resulting gain or loss in profit or loss unless that IFRS
specifies otherwise.
31
 Fair value measurement…(Cont’d)

2.1.4. Valuation methods

 An entity shall use valuation techniques that are

appropriate in the circumstances and for which

sufficient data are available to measure fair value,

maximizing the use of relevant observable inputs and

minimizing the use of unobservable inputs.

32
 Fair value measurement…(Cont’d)

 The objective of using a valuation technique is to

estimate the price at which an orderly transaction to
sell the asset or to transfer the liability would take
place b/n market participants at the measurement date
under current market conditions.
 An entity shall use valuation techniques consistent
with one or more of those approaches to measure fair
value. 33
 Fair value measurement…(Cont’d)
 In some cases a single valuation technique will be appropriate
(eg. when valuing an asset or a liability using quoted prices in
an active market for identical assets or liabilities).
 In other cases, multiple valuation techniques will be
appropriate (e.g. that might be the case when valuing a cash-
generating unit).
 If multiple valuation techniques are used to measure fair value,
the results (i.e. respective indications of fair value) shall be
evaluated considering the reasonableness of the range of
values indicated by those results. 34
 Fair value measurement…(Cont’d)
 Valuation techniques used to measure fair value shall be applied
consistently.
 However, a change in a valuation technique or its
application is appropriate if the change results in a
measurement that is equally or more representative of fair value
in the circumstances.
 New markets develop;
 New information becomes available;
 Information previously used is no longer available;
 Valuation techniques improve; or
 Market conditions change
 IFRS 13 set out three widely used valuation techniques are the
market approach, cost approach and income approach.
35
 Fair value measurement…(Cont’d)
1. Market Approach
Market approach

 Provides an indication of value by comparing the asset with

identical or comparable (similar) assets for which price

information is available

 When reliable, verifiable, and relevant market information is

available, the market approach is the preferred valuation

approach.
 Fair value measurement…(Cont’d)
2. Income approach
 Provides an indication of value by converting future cash flow
to a single current value.
 In which the value of an asset is determined by reference to the
value of income, cash flow, or cost savings generated by the
asset.
 A fundamental basis for the income approach is that investors
expect to receive a return on their investments and that such a
return should reflect the perceived level of risk in the
investment.
 Generally, investors can only expect to be compensated for
systematic risk (also known as “market risk” or “non-
diversifiable risk”).
 Fair value measurement…(Cont’d)
3. Cost Approach
 The approach provides an indication of value by calculating the
current replacement or reproduction cost of an asset and
making deductions for physical deterioration and all other
relevant forms of obsolescence.
 The cost approach provides an indication of value using the
economic principle that a buyer will pay no more for an asset
than the cost to obtain an asset of equal utility, whether by
purchase or by construction, unless undue time, inconvenience,
risk or other factors are involved.
 Fair value measurement…(Cont’d)

2.1.5. Fair value hierarchy

 To increase consistency and comparability in fair

value measurements and related disclosures, this

IFRS establishes a fair value hierarchy that

categorizes into three levels the inputs to valuation

techniques used to measure fair value.

39
 Fair value measurement…(Cont’d)

 The fair value hierarchy gives the highest priority to quoted

prices (unadjusted) in active markets for identical assets or

liabilities (Level 1 inputs) and the lowest priority to

unobservable inputs (Level 3 inputs).

 In some cases, the inputs used to measure the fair value of an

asset or a liability might be categorized within different levels

of the fair value hierarchy.

40
 Fair value measurement…(Cont’d)

 In those cases, the fair value measurement is categorized in its

entirety in the same level of the fair value hierarchy as the

lowest level input that is significant to the entire measurement.

 Assessing the significance of a particular input to the entire

measurement requires judgment, taking into account factors

specific to the asset or liability.

41
 Fair value measurement…(Cont’d)

 Adjustments to arrive at measurements based on fair

value, such as costs to sell when measuring fair value

less costs to sell, shall not be taken into account when

determining the level of the fair value hierarchy

within which a fair value measurement is categorized.

42
Fair value hierarchy application guidance: Levels 1, 2 and 3

Is there a quoted price in an active market for an identical

asset or liability?

Yes No
Use this quoted price to
measure fair value
Replicate a market price through a
(Level 1 valuation technique
measurement) (maximize use of observable inputs)

No use of significant Use of significant

unobservable inputs unobservable inputs

(Level 2 measurement) (Level 3 measurement)

 Fair value measurement…(Cont’d)

 When measuring fair value, the entity is required to

 Maximize the use of observable inputs and

 Minimize the use of unobservable inputs

44
 Fair value measurement…(Cont’d)
Unobservable inputs:
 Inputs used in fair value accounting for which there is no
market information available, which instead use the best
information available for pricing assets or liabilities.
 Unobservable inputs can be quite subjective.
 It may include the reporting company’s own data, adjusted
for other reasonably available information.
 Examples: an internally-generated financial forecast and the
prices contained within an offered quote from a distributor.
45
 Fair value measurement…(Cont’d)
Observable inputs:
 Are derived from market data that properly reflect the
assumptions that third parties would use when setting prices
for assets and liabilities.
 Examples of markets that are considered to provide
observable inputs are stock exchanges, dealer markets,
and brokered markets.
 To this end, the standard introduces a fair value hierarchy,
which prioritizes the inputs into the fair value measurement
process. 46
 Fair value hierarchy
IFRS13 establishes a three level fair value
hierarchy for inputs to measure fair value:
Unadjusted quoted prices in active markets
for identical assets or liabilities
Level
Inputs other than 1 prices for
quoted
similar/ ide . Asset included in Level
1 that are observable, either directly
or indirectly
Level
Unobservable 2
inputs-
professional forecast
Level 3
 Fair value hierarchy
Level 1
 Unadjusted quoted prices in active markets for identical assets
or liabilities that the entity can access at the measurement date

A quoted price in an active market provides the most reliable evidence

of fair value and should be used without adjustment to measure fair
value subject to some exceptions.

Examples for Level 1 inputs:

• Share prices in a stock exchange
• Some traded derivatives
• Some commodities.
 Fair value hierarchy
Level 2
Inputs, other than quoted prices included in Level 1, that are
observable for the asset or liability, either directly or
indirectly

Examples for Level 2 inputs:

• Quoted prices for similar assets or liabilities in active
markets
• Quoted prices for identical or similar assets or liabilities
in markets that are not active.
 Fair value hierarchy
Level 3
unobservable inputs for the asset or liability
 Unobservable inputs should be used to measure fair value to
the extent that relevant observable inputs are not available.
 Unobservable inputs should reflect the assumptions that
market participants would use when pricing the asset or
liability, including assumptions about risk.
 The entity should maximize the use of relevant observable
inputs and minimize the use of unobservable inputs.
 Examples: mortgage-backed securities (MBS), private
equity shares, complex derivatives, foreign stocks, and
distressed debt
 Fair value measurement…(Cont’d)

2.1.6 Fair value of non financial asset

 A fair value measurement of a non-financial asset takes into
account a market participant’s ability to generate economic
benefits by using the asset in its highest and best use or by
selling it to another market participant that would use the asset
in its highest and best use.
 The highest and best use of a non-financial asset takes into
account the use of the asset that is physically possible, legally
permissible and financially feasible, as follows:
51
 Fair value measurement…(Cont’d)

1. A use that is physically possible takes into account

the physical characteristics of the asset that market

participants would take into account when pricing the

asset (e.g. the location or size of a property).

52
 Fair value measurement…(Cont’d)

2.A use that is legally permissible takes into account

any legal restrictions on the use of the asset that market

participants would take into account when pricing the

asset (e.g. the zoning regulations applicable to a

property).

53
 Fair value measurement…(Cont’d)

3. A use that is financially feasible takes into account whether a

use of the asset that is physically possible and legally permissible

generates adequate income or cash flows (taking into account

the costs of converting the asset to that use) to produce an

investment return that market participants would require from an

investment in that asset put to that use.

54
 Fair value measurement…(Cont’d)

 The fair value of the land and building should take into account

the possibility of the change of usage since the restriction is a

characteristic of Entity A and not a characteristic of the asset.

 Therefore, the fair value of the property will be the higher of:

1. Its current use or

2. Its use for residential development

 Fair value measurement…(Cont’d)
2.1.7. Disclosure
 An entity shall disclose information that helps users of its financial statements
assess both of the following:
I. For assets and liabilities that are measured at fair value on a recurring or non-
recurring basis in the statement of financial position after initial recognition,
the valuation techniques and inputs used to develop those measurements.
II. For recurring fair value measurements using significant unobservable inputs
(Level 3), the effect of the measurements on profit or loss or other
comprehensive income for the period.
III. Fair values that are required or permitted only on initial recognition are
exempted from IFRS 13’s disclosures.

56
 Impairment
2.2.1. Definition
 An impairment loss is the amount by which the carrying
amount of an asset or a cash generating unit(CGU) exceeds its
recoverable amount.
 A CGU is the smallest identifiable group of assets that
generates cash inflows that are largely independent of
the cash inflows from other assets or group of assets.
 The carrying amount is the amount at which an asset is
recognized after deducting any accumulated
depreciation (amortization) and accumulated
impairment losses thereon.
 The recoverable amount is the higher of an asset’s or
cash generating unit fair value less costs of disposal and
its value in use.
57
 Impairment …(Cont’d)

 An assets value in use is the present value of the

future cash flows expected to be derived from an
asset or cash generating unit.
 Fair value is the price that would be received to sell
an asset or paid to transfer a liability in an orderly
transaction between market participants at the
measurement date.
 An entity shall assess at the end of each reporting
period whether there is any indication that an asset
may be impaired.

58
 Impairment …(Cont’d)

 A long-lived tangible asset is impaired when a company is

not able to recover the asset’s carrying amount either

through using it or by selling it.

 To determine whether an asset is impaired, on an annual

basis, companies review the asset for indicators of

impairments—that is, a decline in the asset’s cash-

generating ability through use or sale.. 59

 Impairment …(Cont’d)
 This review should consider
 Internal sources (e.g., adverse changes in performance) and
 External sources (e.g., adverse changes in the business or
regulatory environment) of information.
 If impairment indicators are present, then an impairment test
must be conducted.
 This test compares the asset’s recoverable amount with its
carrying amount.
 If the carrying amount is higher than the recoverable
amount, the difference is an impairment loss.
 If the recoverable amount is greater than the carrying
amount, no impairment is recorded.

60
 Impairment …(Cont’d)
Recoverable amount
 Defined as the higher of fair value less costs to sell or
value-in-use.
 Fair value less costs to sell means what the asset
could be sold for after deducting costs of disposal.
Value-in-use
 The present value of cash flows expected from the
future use and eventual sale of the asset at the end of its
useful life. 61
 Impairment …(Cont’d)
Example:
 Assume that Cruz Company performs an impairment
test for its equipment. The carrying amount of Cruz’s
equipment is €200,000, its fair value less costs to sell
is €180,000, and its value-in-use is €205,000.
 In this case, the value-in-use of Cruz’s equipment is
higher than its carrying amount of €200,000.
 As a result, there is no impairment.
62
 Impairment …(Cont’d)

Example:

 Assume the same information for Cruz Company

above except that the value-in-use of Cruz’s

equipment is €175,000 rather than €205,000.

63
 Impairment …(Cont’d)
 Cruz measures the impairment loss as the difference
between the carrying amount of €200,000 and the higher
of fair value less costs to sell (€180,000) or value-in-use
(€175,000).
 Cruz therefore uses the fair value less cost of disposal to
record an impairment loss of €20,000 (€200,000 -
€180,000).
 Cruz makes the following entry to record the impairment
loss.
64
 Impairment …(Cont’d)
Loss on Impairment 20,000

Accumulated Depreciation—Equipment 20,000

 The Loss on Impairment is reported in the income statement in
the “Other income and expense” section.
 The company then either credits Equipment or Accumulated
Depreciation—Equipment to reduce the carrying amount of the
equipment for the impairment.
 Accumulated depreciation credited when recording
impairment for a depreciable asset.
65
 Impairment …(Cont’d)

 The impairment loss shall be allocated to reduce the

carrying amount of the assets of the unit (group of

units) in the following order:

 First, on goodwill

 Then, to the other assets on pro rata basis

66
 Impairment …(Cont’d)
2.2.3. Reversal of impairment
 After recording the impairment loss, the recoverable
amount becomes the basis of the impaired asset.
 What happens if a review in a future year indicates that the
asset is no longer impaired because the recoverable
amount of the asset is higher than the carrying amount?
 In that case, the impairment loss may be reversed.

Accumulated Depreciation—Equipment….xxx
Recovery of Impairment Loss …………..xxx
67
 Impairment …(Cont’d)
2.2.4. Disclosure
An entity shall disclose the following for each class of assets:
In the Statement of Comprehensive Income
(a) In profit or loss:
i. The amount of impairment losses recognized in profit or loss
during the period & the line item(s) of the statement of
comprehensive income in which those impairment losses are
included;
ii. The amount of reversals of impairment losses recognized in
profit or loss during the period and the line item of the
statement of comprehensive income in which those
impairment losses are reversed.

68
Individual Assignment
 Independent Assignment 1
1. At 31 December 2014 Ethio telecom buys a start up company.
Ethio telecom is decides to take the acquired company as one
cash generating unit. In the CGU, there are the following assets :
 Carrying amount = 2,300,000
 1,500,000 Network Tower
 500,000 Satiate license
 300,000 goodwill
 Recoverable amount = $1,600,000 (value in use)
 Fair value of network tower= $1,400,000
Required
Calculate impairment and allocation of impairment loss
 Independent Assignment 2

2. 1 January 2011 Ethio telecom buys a measuring instrument

 cost = 1 million

 useful life = 5 years

 depreciation method = straight-line

 nil residual value

 31 December 2012 the recoverable amount = 300,000

 31 December 2014 the recoverable amount of the machine = $800,000

Required

Calculate the impairment and reversal of impairment loss

 Independent Assignment 3

3. An entity has purchased the whole of the share capital of another entity for a purchase

consideration of 20 million. The goodwill arising on the transaction was 5 million. It

was planned at the outset that the information systems would be merged in order to

create significant savings. Additionally the entity was purchased because of its market

share in a particular jurisdiction and because of its research projects. Subsequently the

cost savings on the information systems were made. The government of the jurisdiction

introduced a law that restricted the market share to below that anticipated by the entity,

and some research projects were abandoned because of lack of funding.

Required

Explain any potential indicators of the impairment of good will

 Independent Assignment 4

4. An entity has two cash-generating units, X and Y. There is no

goodwill within the units’ carrying values. The carrying values are X 10
million and Y 15 million. The entity has an office building that has not
been included in the above values and can be allocated to the units on
the basis of their carrying values. The office building has a carrying
value of 5 million.
The recoverable amounts are based on value-in-use of 9 million for X
and 19 million for Y.
Required:-
Determine whether the carrying value of X and Y are impaired
 Independent Assignment 5
5. On January 1, 2011 ethio telecom buys a measuring instrument
 cost = 1 million
 Useful life = 10 years
 Depreciation method = straight-line
 Nil residual value
 31 December 2014 the recoverable amount = 300,000
 31 December 2016 the recoverable amount of the machine =
$800,000
Required
Calculate the impairment and reversal of impairment loss
 Independent Assignment 6
6. Your factory is built on Plot 900 in a recently developed
industrial development zone on the outskirts of Addis Ababa where
the land that is divided into one hundred two acre plots that before
their further development were essentially homogenous. Factories,
like yours, are the highest and best use for the land rights.
 On 31 December 2002, two of the plots adjoining your plot
were sold
 Plot 901 sold for 30 million: land rights with a similar factory of
the same age, same condition and same floor area as yours.
 Plot 899 sold for 10 million because it is undeveloped (yet to be
built on)
Required : estimate the fair value
 Independent Assignment 7

7. Entity A pledges 100,000 BP plc shares that it owns as collateral

in a borrowing arrangement.
 Consequently, Entity A cannot sell its BP shares until it settles
the borrowing.
 BP plc shares are issued without such a restriction and trade on
both the London Stock Exchange and the New York Stock
Exchange.
 Required: Is the restriction relevant to measuring the fair value
of the BP shares held by Entity A? Choose one of:
A. Yes
B. No
C. It depends (specify)
THE END