For example, a tax asset may appear on the company's accounts due to losses in previous years (if carry-forward of tax losses is allowed). In this case a deferred tax asset should be recognised if and only if the management considered that there will be sufficient future taxable profit to use the tax loss. If it becomes clear that the company does not expect to make profits in future years, the value of the tax asset has been "impaired": in the estimation of management, the likelihood that this tax loss can be used in the future has significantly fallen.