Research On The Goodwill Impairment Of Z Company’s Successive Mergers And Acquisitions

A-share listed companies have made frequent m&a deals since 2014.At the same time,the total amount of goodwill of listed companies is also surging,and the risk of goodwill impairment is gradually highlighted.In 2019,China’s capital market took place goodwill collective "thunder" event.This event brought adverse effects to companies and harmed the profits of investors.Online game industry because of its asset-light characteristics,make m&a target has a higher premium rate.Therefore,this paper takes Z Company in the Internet game industry as an example to analyze the goodwill impairment problem of its continuous mergers and acquisitions,deeply analyze the reasons for the huge amount of merged goodwill and goodwill impairment,and put forward relevant countermeasures.Firstly,this paper introduces relevant literature and theories to lay a good foundation for subsequent research.And then analyze the goodwill formed in the continuous acquisition process of Z company and the subsequent goodwill impairment.Taking this as the starting point,this paper makes an in-depth analysis of the reasons for the excessive amount of goodwill impairment provision of Z Company.The research finds that the dominant reasons are the asset-light characteristics of the industry,the not proper selection of m&a valuation methods and the improper setting of performance commitments.In the follow-up measurement,Z company drew a huge amount of goodwill impairment due to the unqualified performance commitment,the defects of post-merger operation integration,the earnings management motivation of Z Company,and the poor governance quality of senior executives and the board of directors.Then,it analyzes the consequences of huge goodwill impairment.Finally,this paper gives the countermeasures.About the company forming a huge amount of goodwill,it is suggested that companies choose appropriate valuation methods,establish a strict review mechanism and make rational performance commitments.In view of the company’s subsequent formation of huge goodwill impairment,this paper gives the following suggestions.The company should exert synergistic effect and pay attention to management integration.Relevant departments should improve the follow-up measurement accounting treatment of goodwill and guard against earnings management.Supervision of the board of directors and senior executives should also be strengthened,punishment should be strengthened for acts that violate the provisions of the law.In addition,this paper also hopes to provide some reference in related industries by studying the goodwill impairment issues of Z company’s continuous mergers and acquisitions.