Choice Of Goodwill Subsequent Measurement Model

The IASB's discussion of the follow-up measurement model of goodwill and the large-scale thunderstorm of goodwill in 2018 prompted the theoretical and practical circles to pay attention to the rationality of the single impairment method as a follow-up measurement model of goodwill.This article explores the nature of goodwill through theoretical analysis and standard research.It is believed that goodwill is owned or controlled by the company and formed from past transactions or events,which can continue to bring excess returns to the company(better than the profitability of its peers).,An unaccounted core capability.Its core characteristics are: first,it represents the present value of future excess net cash inflows;second,it is sustainable.Therefore,this article selects variables and builds models based on the core characteristics of the nature of goodwill,and analyzes the data of China's A-share market from 2014 to 2018.The study found that the current situation of the accounting information reflected in the A-share market is deviated from the essence of goodwill,that is,the newly-added goodwill in the current period has no positive impact on the company's performance and excess income in the short term,and has a negative impact in the long run,which can not bring sustained corporate results.excess income.Therefore,using only the impairment method with a large surplus space,a large amount of goodwill has been booked for a long time and does not reflect the true situation of goodwill.Therefore,it is recommended to reconsider the introduction of the amortization method as a model for subsequent measurement of goodwill.At the same time,this article expounds the advantages and disadvantages of the impairment method and the amortization method through a combination of theoretical analysis and case analysis,and further provides theoretical and practical support for the introduction of the amortization method.