A Study On The Impairment Of Goodwill

In recent years,mergers and acquisitions in the capital market have been increasing,and a great deal of goodwill has been generated.Goodwill represents a good expectation of the future profitability of the acquired party.It is the difference between the cost of the merger and the net identifiable net assets of the acquired party.Due to various reasons,a large number of listed companies have suffered a large amount of goodwill impairment in the short term after the merger and acquisition.This situation has not only aroused doubts from the relevant parties,but also aroused the attention of the relevant management departments.This paper chooses the representative case of the merger and acquisition of Guangzhou Longwen by on-the-job shares,and focuses on the analysis of the impairment of goodwill.Before the promulgation of the new accounting standards for enterprises in 2006,China adopted the amortization method for the follow-up measurement of goodwill,requiring it to be amortized within 10 years after the formation of goodwill.According to the newly promulgated "Accounting Standards for Enterprises No.8-Asset impairment" provisions,has converged with the international accounting standards,that is,the implementation of goodwill impairment test,the cancellation of goodwill amortization.Based on the analysis of the formation process of high merger goodwill in 2016,this paper restores the impairment of goodwill in 2017,and puts forward some opinions on the reserve of goodwill impairment in 2017.At the same time,the author considers the relationship between goodwill impairment and earnings management,and the rationality of the measurement of goodwill impairment.By studying the process from confirmation to disclosure of goodwill impairment,the author draws four main conclusions:(1)confirmation and calculation of goodwill impairment by external institutions.Goodwill impairment has played an important role;(2)the criteria for the provision of goodwill impairment is too general;(3)there are certain subjective factors in the measurement of goodwill impairment.In view of the above conclusions,the author proposes that we should further improve the standards,strengthen the supervision of relevant parties,enhance their own capabilities and learn from the relevant provisions of the United States accounting standards to improve the theory and practice of goodwill impairment.