Research On Causes Of Goodwill Impairment And Its Measurement Method

In the background of the booming of mergers and acquisitions in recent years,the amount of goodwill in financial statements is increasing,and the proportion is getting higher and higher.With the international convergence of accounting standards,China also issued a new asset impairment standard,to achieve a more fair measurement of the value of goodwill and reflect the company's real performance.However,in recent years,the capital market has been accumulating huge amounts of goodwill.The huge amount of goodwill impairment loss has become a black hole in the performance of listed companies,which has damaged the interests of investors,making it doubtful for scholars that whether the current goodwill standard can effectively and honestly reflect the essence of goodwill and provide real and effective accounting information for users of financial statements,which has caused widespread concern.Based on the above,this paper focuses on goodwill impairment.Explore the specific reasons that affect the impairment of goodwill and the problems behind it,and seek for the more reasonable and effective goodwill measurement method.Based on the previous studies,this paper uses case study,statistical analysis method and so on,sort out the development of goodwill standards,combined with the theory of asset impairment,principal-agent theory,information asymmetry theory and economic consequence theory to conduct research.Firstly,the paper statistical analyzes the book value and the impairment loss of goodwill of China's listed companies,the disclosure and the industry distribution of goodwill impairment,finding some general problems with the impairment of goodwill.Secondly,taking the TMT industry's Yushun Company as an example,through the combing of its goodwill process,find that its goodwill impairment loss has a huge negative impact on its performance,and in-depth explore the reasons behind it,including:1)The performance of the target company is not optimistic and the goodwill impairment reflects the economic substance to a certain extent;2)The initial confirmation of the goodwill is too high that provide a huge room for subsequent impairment;3)Some provisions of the goodwill standard are not perfect enough.The disclosure requirements for related information are relatively simple,making the process of goodwill impairment unclear;4)A large number of subjective judgments provide earnings management space for managers,and managers may manipulate profits through goodwill impairment in the goal of smoothing profits or turning losses into profits or defending their own interests.Finally,from the perspectives of the choice of the impairment method and amortization method,to explore how to improve the subsequent measurement method of goodwill,and provide suggestions for the improvement and of China's goodwill accounting standards.The innovations of this paper are as follows:Firstly,by focusing on a specific real case,explore the multi-dimensional reasons behind the impairment of goodwill to discover the problems behind it;The second is through the simulation analysis of specific data to explore the more reasonable and effective measurement methods of goodwill.