Goodwill is an intangible asset‚ probably the most intangible of all intangible assets‚ hard to measure and even more difficult to account for. Goodwill today constitutes a much larger part of acquisition prices than it did previously‚ resulting in a much greater impact on financial statements. During the twentieth century the concept of goodwill has changed significantly. In the earlier days goodwill was thought of as the good and valuable relationships of a proprietor of a business with his customers
Premium Balance sheet Goodwill Asset
Goodwill can be termed as the present value of expected future income in excess of a normal return on the investment in tangible assets‚ or‚ for the excess of price paid for a business as a whole over the book value‚ or‚ over the computed or agreed value of all tangible net assets purchased. Characteristics of goodwill: The characteristics of goodwill emerge as mentioned below: 1. It is an intangible asset but not a fictitious asset; 2. It cannot have an existence separate from the organization;
Premium Goodwill Asset Balance sheet
Impairment of goodwill and CGUs By Graham Holt Studying this technical article and answering the related questions can count towards your verifiable CPD if you are following the unit route to CPD and the content is relevant to your learning and development needs. One hour of learning equates to one unit of CPD. We’d suggest that you use this as a guide when allocating yourself CPD units. The basic principle of impairment is that an asset may not be carried on the statement of financial position
Premium Goodwill Subsidiary Asset
Goodwill by Tom Clendon It is relevant to ACCA F7 and P2 international stream students. Goodwill Following the revisions to IFRS3 Business Combinations and IAS27 Consolidated and Separate Financial Statements in January 2008 there is now two ways of measuring the goodwill and the non controlling interest (NCI) that arises on the acquisition of a subsidiary. Traditional / Proportionate method The traditional measurement of goodwill on the acquisition of a subsidiary is the excess of the
Premium Goodwill Balance sheet Generally Accepted Accounting Principles
Galaxy has made various acquisitions over all segments of their business. These acquisitions resulted in a total of $360 million of goodwill as of December 2011‚ $200 million attributed to the Fitness Equipment‚ $130 million attributed to Golf equipment‚ and $30 million attributed to the Hockey Equipment. In previous years‚ management had performed the annual goodwill impairment
Premium Generally Accepted Accounting Principles Balance sheet Goodwill
Case 11-9 Goodwill Impairment Testing • Galaxy Sports Inc. (Galaxy)‚ a U.S.-based manufacturer of sports equipment‚ is a calendar year-end SEC registrant with one operating segment and the following three reporting units: o Fitness Equipment. o Golf Equipment. o Hockey Equipment. • Galaxy is in a competitive industry with several publicly traded companies in which growth and profitability are tied to the market and consumer demand. • Three reporting units are appropriate because
Premium Copyright Stock market Generally Accepted Accounting Principles
ACCOUNTING FOR INTANGIBLE ASSETS “WHY NOT ELIMINATE GOODWILL?” INTRODUCTION The Balance Sheet is one of the financial statements necessary to help different kinds of individuals – owners of enterprises‚ management of companies‚ analysts‚ creditors‚ inventors in making business decisions. It is a statement that tells about the financial position of the company. It encompasses the three main elements of the accounting equation – the assets‚ the liabilities and owner’s equity. The assets are
Premium Balance sheet Asset Goodwill
Goodwill Industries Financial Condition and Operations Goodwill Industries are organizations for nonprofit making that provide or render employment‚ community based programs‚ placement services‚ and job training to individuals that cannot access proper education‚ disabled individuals and the unemployed. A huge network of institutions of retail thrift‚ that works as organizations of nonprofit organizations‚ sponsor goodwill industries. A large portion of goodwill industries finance is donated items
Premium Balance sheet Generally Accepted Accounting Principles Income statement
Goodwill Case Study University of Maryland University College Marketing Principles 310 Keisha V. Morris November 9‚ 2014 Founded in 1902‚ by Rev. J. Edgar Helms‚ Mr. Helms described the vision of Goodwill Industries as “a provider of employment‚ training and rehabilitation for people of limited employability‚ and a source of temporary assistance for individuals whose resources were depleted.”1 Since that time Goodwill industries has strived to maintain Mr. Helms’ vision and provide
Premium Marketing Management Psychology
Describe the amortisation requirements for certain identifiable intangible assets and the changes to accounting for goodwill introduced as part of the convergence with international accounting standards. How will these changes affect reported profit? General amortisation requirements Intangible assets (other than goodwill) that are considered to have a limited useful life are required to be amortised over their useful lives defined as ‘the period of time over which the asset is expected to be used
Premium Balance sheet Generally Accepted Accounting Principles Goodwill