Research On Goodwill Impairment In The Media Industry

With the rapid development of China's economy and the constant change of social environment,the market competition is becoming more and more fierce.In order to survive and develop continuously and steadily in the competition,enterprises usually choose merger and acquisition to improve their competitiveness.In 2014,China's listed companies ushered in a large-scale merger and acquisition wave.The number of mergers and acquisitions of listed companies keeps rising,and the transaction amount keeps reaching new highs,which is followed by the formation of huge goodwill.Although huge goodwill can improve the asset level of enterprises,it also accumulates potential risks for enterprises.In recent years,there are more and more discussions about goodwill impairment in the field of practice.Therefore,goodwill impairment has become a research hotspot.Especially after 2018,a large scale of goodwill "thunderbolt" made many enterprises in the state of loss.From the perspective of industry,the media industry has become the disaster area of goodwill impairment.Media industry is different from traditional manufacturing,is a typical light industry assets,fixed assets accounted for the small,many high value of resources in the form of naked,so,when mergers and acquisitions,will produce a higher premium,will form the big reputation,a common media industry "high valuation,high performance,high premium commitment","suddenly turn hostile" performance in an industry such as frequent mess,so bring the potential risk is bigger,which may affect the subsequent business.This paper mainly adopts literature research method,case study method and financial analysis method to carry out research design.First of all,through the literature research method,this paper sorts out the domestic and foreign literature on goodwill and its impairment,defines the concept related to goodwill,and introduces the relevant theories,which provides a theoretical basis for the subsequent analysis.Then,from the perspective of the media industry,this paper analyzes the background of the media industry and the status quo of M&A.Meanwhile,it makes descriptive statistics on the goodwill and impairment of the media industry and analyzes its problems.Secondly,the case analysis method is adopted to select EGLS,which has a prominent problem of goodwill impairment,as the research object.After analyzing the formation of goodwill and the situation of goodwill impairment in the merger and acquisition,the causes of the huge goodwill impairment in this event are explored.Finally,this paper analyzes the impact of huge goodwill impairment on the company by financial analysis method,puts forward suggestions on the prevention of goodwill impairment risk of the company in the case of this event,and further puts forward suggestions to the media industry and regulatory authorities.