There may be instances in which a fixed asset loses its value and needs to be
written down in the accounting books of the firm. An asset can become impaired for a
number of reasons, which include becoming obsolete, failing to meet regulatory
standards, damages to the asset, changing market conditions, etc. Other company
accounts such as a goodwill and accounts receivable can also become impaired. Firms
are required to conduct regular tests on asset impairment (especially on goodwill) and
any impairment then will be written off.