Study On The Impairment Risk Of Goodwill On Mergers And Acquisitions Of Listed Companies

In 2014,under the guidance of China’s economic environment and policies,M&A became an important means for many listed companies to seek development and transformation,and China set off a wave of M&A restructuring.However,while M&A provides development opportunities for listed companies,it also forms huge amounts of goodwill along with it.Once the goodwill is impaired,it will not only adversely affect the subsequent normal operation of the enterprise,but also damage the interests of investors,and seriously even disrupt the order of the capital market.2018 A-share listed companies’ goodwill collective thunderstorm incident has caused the risk of huge goodwill impairment to erupt,which seriously affects the smooth operation of the capital market.The issue of goodwill of China’s listed companies can no longer be ignored,and the document "Accounting Supervision Risk Alert No.8-Goodwill Impairment" issued by the SFC in 2018 and the Notice on Strengthening the Management of Goodwill of Central Enterprises issued by the SASAC in 2022 both include the issue of goodwill impairment into the key management scope.The increasing number of goodwill impairment events has also triggered new thinking about the risk of goodwill impairment from all walks of life,and the risk of goodwill impairment in mergers and acquisitions of listed companies has become a pressing issue at the moment.Therefore,this paper focuses on the risk factors affecting the impairment of goodwill and proposes recommendations to prevent the risk of goodwill impairment in order to provide reference for listed companies to prevent goodwill impairment.This paper selects Xunyou Technology as the object of study,firstly compares the basic situation of Xunyou Technology’s M&A transaction,and briefly analyzes the economic consequences of Xunyou Technology’s large goodwill impairment.Secondly,we identify the risk factors triggering goodwill impairment from three levels:enterprise operation condition,external environment change and enterprise internal control,and establish the corresponding index system;then use the hierarchical analysis method to calculate the weight of each index,and combine it with the fuzzy comprehensive evaluation method to calculate the comprehensive evaluation index of the target level and each criterion level,and classify the severity of the risk,so as to build a goodwill impairment risk management system.The results of the study show that,among the risk factors affecting goodwill impairment of Xunyou Technology,the highest risk is at the level of corporate operating conditions,followed by the level of internal control and the level of external environmental changes,while at the level of secondary indicators,the top three risk weights are integration risk,managerial manipulation risk and performance commitment risk.Finally,based on the risk identification and assessment,risk prevention measures are proposed at the enterprise level,industry regulation level and standard setting level according to the type and nature of risk factors,so that it can better prevent and resolve the M&A goodwill impairment risk,and also provide some reference for other listed companies to prevent the M&A goodwill impairment risk.