The starting point for the research was the evidence of a possible contradiction in the provisions of IAS 12 on goodwill and deferred income taxes, i.e., about the need to calculate deferred income taxation on tempora...The starting point for the research was the evidence of a possible contradiction in the provisions of IAS 12 on goodwill and deferred income taxes, i.e., about the need to calculate deferred income taxation on temporary differences relating to all assets except for goodwill. This paper aims at exploring the degree of consistency between the theoretical provisions of International Accounting Standards （IAS）/International Financial Reporting Standards （IFRS） and their actual application by the management of Italian and Bulgarian listed companies, as regards the accounting treatments of deferred income taxes relating to the item ＂goodwill＂. The findings suggest that there are some differences between the accounting methods used by the management of most Italian listed companies and the provisions of IAS/IFRS. It can be argued that the rules given by IAS/IFRS are sometimes contradictory, since they may cause doubts in interpretation. As a consequence, in the end of the paper, an amendment to the provisions, set forth in IAS/IFRS concerning the accounting treatment of deferred income taxes relating to the item ＂goodwill＂, is proposed.展开更多
Accounting goodwill arises as a result of business combinations and appears in a consolidated balance sheet of an acquirer. It is an intangible asset which reflects an excess of value of an acquired business as a whol...Accounting goodwill arises as a result of business combinations and appears in a consolidated balance sheet of an acquirer. It is an intangible asset which reflects an excess of value of an acquired business as a whole over a summed value of its identifiable net assets. Since 2010, the International Financial Reporting Standards （IFRS） allow for two alternative methods of measuring goodwill in those business combinations, where an acquirer obtains a control over a target company without obtaining 100% share in its shareholder＇s equity. Under one of these methods, which is called a ＂full-goodwill method＂, the goodwill attributable to non-controlling interests in subsidiary is measured at fair value. Thus, the main accounting problem with this method lies in its requirement to estimate the fair value of non-controlling interests. This paper suggests that the ＂full-goodwill method＂ may sacrifice financial statement reliability for its alleged relevance, with significant potential for ＂creative accounting＂. The problems with reliability and transparency of financial statements, when ＂full-goodwill method＂ is applied, are illustrated by a real-life example of the takeover of Formula Systems Ltd. by Asseco Group （one of the biggest IT companies in Europe, listed on the Warsaw Stock Exchange）.展开更多
The introduction of FRS （financial reporting standards） 136 to Malaysian PLC＇s （public limited company） in 2006 indirectly formalized accounting for purchased goodwill for the first time. Based on a sample of 200...The introduction of FRS （financial reporting standards） 136 to Malaysian PLC＇s （public limited company） in 2006 indirectly formalized accounting for purchased goodwill for the first time. Based on a sample of 2006 annual reports of 10 Main Board companies from plantation sector, the study finds the level of desired disclosure has yet to be met. Whilst the intention of the standard is noble, actual practice for first time reporting entities indicate that Malaysian PLC＇s and their auditors have far to go before they can meet the expectation set by FRS 136 in particular and International Financial Reporting Standards in general.展开更多
The issue of goodwill impairment has been debated in many countries throughout the world. Adoption of International Financial Reporting Standards （IFRS） introduced fundamental changes in accounting and impairment me...The issue of goodwill impairment has been debated in many countries throughout the world. Adoption of International Financial Reporting Standards （IFRS） introduced fundamental changes in accounting and impairment methods for goodwill. Since global stock markets went into decline in 2008, there has been much debate over the issue of goodwill impairment in the US and European stock exchange markets, especially on how large the write-downs should be. Complexity of International Accounting Standards （IAS） and IFRS focusing on goodwill and goodwill impairment techniques may lead to inconsistent compliance and varying levels of disclosure quality. The aim of this study is to analyze goodwill impairment during and after the recent financial crisis for companies listed on the Borsa Istanbul （BIST） 100 index and to assist the financial statement users in the assessment of disclosure quality under IAS 36, Paragraph 134d. Tools such as： （1） the period over which management has projected cash flows; （2） the growth rate used for cash flow projections; （3） the discount rate（s） applied to projections; and （4） methods employed to determine recoverable amount are analyzed. Insufficient disclosures on these tools are observed. The findings are of interest to researchers examining the implication of IAS 36, regulators, and policy-setters.展开更多
Nowadays,the wave of mergers and acquisitions in the capital market is still surging.High evaluation does bring high performance,and the huge impairment of goodwill has become a key factor for the frequent Black Swan ...Nowadays,the wave of mergers and acquisitions in the capital market is still surging.High evaluation does bring high performance,and the huge impairment of goodwill has become a key factor for the frequent Black Swan events of listed companies.Starting from the essence of goodwill,using Chinese A-share listed companies from 2007 to 2019 as samples and based on the market data,distribution analysis and performance impact,this paper argues that problems of goodwill impairment in China are incomplete accounting standards,inexhaustive impairment implementation and incomprehensive market supervision,thus giving reasonable suggestions.Proper follow-up measurement of goodwill is conducive to improving accounting information quality and adapting to capital market demands,which is of great significance to the revision of international standards.展开更多
The wave of M＆A is generally synchronous with the economic development, the restructuring of society and enterprises, and the enterprises are facing new opportunities and challenges. In the process of business combin...The wave of M＆A is generally synchronous with the economic development, the restructuring of society and enterprises, and the enterprises are facing new opportunities and challenges. In the process of business combination, the treatment of goodwill is a special part. There are differences in the treatment of goodwill under the same control of combination and under the different control of combination. Purchase method and equity method are also different. In this paper, the classic case of the merger of China Eastern Airlines and Shanghai Airlines are used to discuss the process of business combination of goodwill and the problems.展开更多
China’s longest serving political deputy legislator is a witness to history by Guo Ying SHE is an ordinary farmer,who has served a record 57 years in Chinese politics.Born into poverty,she was the first person in Ch...China’s longest serving political deputy legislator is a witness to history by Guo Ying SHE is an ordinary farmer,who has served a record 57 years in Chinese politics.Born into poverty,she was the first person in China’s history to put forward the concept of "equal pay for equal work" between men and women and as a village cadre she has been received by state leaders on many occasions. Her name is Shen Jilan,Deputy Secretary of the CPC Com-展开更多
文摘The starting point for the research was the evidence of a possible contradiction in the provisions of IAS 12 on goodwill and deferred income taxes, i.e., about the need to calculate deferred income taxation on temporary differences relating to all assets except for goodwill. This paper aims at exploring the degree of consistency between the theoretical provisions of International Accounting Standards （IAS）/International Financial Reporting Standards （IFRS） and their actual application by the management of Italian and Bulgarian listed companies, as regards the accounting treatments of deferred income taxes relating to the item ＂goodwill＂. The findings suggest that there are some differences between the accounting methods used by the management of most Italian listed companies and the provisions of IAS/IFRS. It can be argued that the rules given by IAS/IFRS are sometimes contradictory, since they may cause doubts in interpretation. As a consequence, in the end of the paper, an amendment to the provisions, set forth in IAS/IFRS concerning the accounting treatment of deferred income taxes relating to the item ＂goodwill＂, is proposed.
文摘Accounting goodwill arises as a result of business combinations and appears in a consolidated balance sheet of an acquirer. It is an intangible asset which reflects an excess of value of an acquired business as a whole over a summed value of its identifiable net assets. Since 2010, the International Financial Reporting Standards （IFRS） allow for two alternative methods of measuring goodwill in those business combinations, where an acquirer obtains a control over a target company without obtaining 100% share in its shareholder＇s equity. Under one of these methods, which is called a ＂full-goodwill method＂, the goodwill attributable to non-controlling interests in subsidiary is measured at fair value. Thus, the main accounting problem with this method lies in its requirement to estimate the fair value of non-controlling interests. This paper suggests that the ＂full-goodwill method＂ may sacrifice financial statement reliability for its alleged relevance, with significant potential for ＂creative accounting＂. The problems with reliability and transparency of financial statements, when ＂full-goodwill method＂ is applied, are illustrated by a real-life example of the takeover of Formula Systems Ltd. by Asseco Group （one of the biggest IT companies in Europe, listed on the Warsaw Stock Exchange）.
文摘The introduction of FRS （financial reporting standards） 136 to Malaysian PLC＇s （public limited company） in 2006 indirectly formalized accounting for purchased goodwill for the first time. Based on a sample of 2006 annual reports of 10 Main Board companies from plantation sector, the study finds the level of desired disclosure has yet to be met. Whilst the intention of the standard is noble, actual practice for first time reporting entities indicate that Malaysian PLC＇s and their auditors have far to go before they can meet the expectation set by FRS 136 in particular and International Financial Reporting Standards in general.
文摘The issue of goodwill impairment has been debated in many countries throughout the world. Adoption of International Financial Reporting Standards （IFRS） introduced fundamental changes in accounting and impairment methods for goodwill. Since global stock markets went into decline in 2008, there has been much debate over the issue of goodwill impairment in the US and European stock exchange markets, especially on how large the write-downs should be. Complexity of International Accounting Standards （IAS） and IFRS focusing on goodwill and goodwill impairment techniques may lead to inconsistent compliance and varying levels of disclosure quality. The aim of this study is to analyze goodwill impairment during and after the recent financial crisis for companies listed on the Borsa Istanbul （BIST） 100 index and to assist the financial statement users in the assessment of disclosure quality under IAS 36, Paragraph 134d. Tools such as： （1） the period over which management has projected cash flows; （2） the growth rate used for cash flow projections; （3） the discount rate（s） applied to projections; and （4） methods employed to determine recoverable amount are analyzed. Insufficient disclosures on these tools are observed. The findings are of interest to researchers examining the implication of IAS 36, regulators, and policy-setters.
文摘Nowadays,the wave of mergers and acquisitions in the capital market is still surging.High evaluation does bring high performance,and the huge impairment of goodwill has become a key factor for the frequent Black Swan events of listed companies.Starting from the essence of goodwill,using Chinese A-share listed companies from 2007 to 2019 as samples and based on the market data,distribution analysis and performance impact,this paper argues that problems of goodwill impairment in China are incomplete accounting standards,inexhaustive impairment implementation and incomprehensive market supervision,thus giving reasonable suggestions.Proper follow-up measurement of goodwill is conducive to improving accounting information quality and adapting to capital market demands,which is of great significance to the revision of international standards.
文摘The wave of M＆A is generally synchronous with the economic development, the restructuring of society and enterprises, and the enterprises are facing new opportunities and challenges. In the process of business combination, the treatment of goodwill is a special part. There are differences in the treatment of goodwill under the same control of combination and under the different control of combination. Purchase method and equity method are also different. In this paper, the classic case of the merger of China Eastern Airlines and Shanghai Airlines are used to discuss the process of business combination of goodwill and the problems.
文摘China’s longest serving political deputy legislator is a witness to history by Guo Ying SHE is an ordinary farmer,who has served a record 57 years in Chinese politics.Born into poverty,she was the first person in China’s history to put forward the concept of "equal pay for equal work" between men and women and as a village cadre she has been received by state leaders on many occasions. Her name is Shen Jilan,Deputy Secretary of the CPC Com-
