Study On Goodwill In Jiai Acquired Anpu Company

Each wave of global mergers and acquisitions will lead many companies having plenty of goodwill,which takes a lasting discussion in both academia and practical circle about the accounting treatment of goodwill.In 2014,domestic companies experienced endogenous growth difficulties.With the national policies encouragement of the restructuring and upgrading about industrial structure,companies began to seek out expansionary development,and many high-premium and high-value transactions emerged in Chinese M&A market,resulting in huge goodwill.Huge goodwill formed by mergers and acquisitions is generally considered to enhance corporate assets and profits in the current period and subsequent fiscal years.However,once the impairment occurs,the company's financial performance will be weighed down,and the company's reputation may even be damaged.Therefore,it is particularly important to correctly treat the recognition and measurement of goodwill.This article is based on the perspective of goodwill,combing the essence of goodwill,accounting treatment and literature on the impact of performance,focusing on the analysis of the recognition and measurement of goodwill arising from mergers and acquisitions.After summing up the current Business Standards in China and the current market situation,it was found that there was a dispute in the initial confirmation and subsequent measurement of goodwill by the company.The author mainly adopts the case analysis method and uses Ji Ai Technology's acquisition as a research case to evaluate the initial confirmation and subsequent measurement of goodwill.In the initial recognition of goodwill,there are signs of overvaluation of the underlying assets and a rise in goodwill based on the income approach.In 2015,Anpu reluctantly fulfilled its performance commitment.However,the disclosure of earnings data was incomplete,and volatility before and after mergers and acquisitions make a suspicion of inflated profits to avoid unfinish performance commitments.In 2016,the impairment test of goodwill was based on the equity of Anpu Shenghui.Although this led to a decline in profitability in 2016,it took advantage of the opportunity to sell in a timely manner to a listed company with significant impairment of goodwill.The loss of annual net profit in exchange for future years will not be affected by the impairment of goodwill.It seems to be a good choice.However,this type of precision-destructive goodwill impairment has proved that management is above the system and goodwill is reduced to the company's performance service.When analyzing the financial performance before and after the acquisition of Jiai Technology,it was found that the large amount of goodwill did not bring about the expected excess profitability of the company,and even reduced the company's profitability in the current period,which also indicated the goodwill of the merger and acquisition is overestimated.Based on the above status quo summary and case analysis,this paper aims at the problems existing in the measurement of goodwill in China.This article strengthens supervision from related departments and improves accounting standards;third party organizations strengthen quality training and ability enhancement;listed companies do their best to achieve enterprise integration after M&A;investors should pay attention to the optimization effect of goodwill on financial statements,and refuse to blindly invest in these four perspectives.These four parties hope to contribute to the improvement of China's goodwill standards and contribute to the healthy development of the capital market.