It stands for held for sale non-current assets; a collection of non-current assets that an entity designates as held for sale (HFS). These assets belong to the broader class of “assets held for sale“, that is, a category of assets that an entity currently holds on its balance sheet but plans to sell in the market against a monetary consideration.A non-current asset is typically classified as held for sale if its carrying amount is expected to be recovered by selling the asset and not from its continuous use by the entity.

The process of selling such assets can be time-consuming and complicated (in the sense that it involves particular marketing and selling efforts), as in the case of specialized assets for which interested buyers may take a long time to locate and transact with. During the period of search and matching, the assets are not used in the entity’s operations and do not generate any revenues.

An HFS-NCA is held at the lower of its carrying value and fair value less cost to sell (FVLCTS).