The Influence Of M&A Characteristics On The Value Relevance Of Purchased Goodwill

From the 19 th century,the United States has experienced six waves of Mergers and acquisitions(M&A).With the deepening of the reform and opening-up and the development of capital markets,since the 90 s of the last century,the scale of M&A deals increased by years,and it brings about a lot of accounting problems,one of the most important question is how to value the M&A target,and the resulting purchased goodwill.With the development of China's M&A market,the proportion of purchased goodwill in net assets is increasing year after year.The value relevance of purchased goodwill information is of great significance to corporate stakeholders,especially investors,and will directly affect the decision-making of accounting information users.Purchased goodwill is produced in the mergers and acquisitions,according to the relevant provisions of the accounting standards for enterprises no.20 business combination purchased goodwill is the combination costs beyond the visible part of the fair value of the identifiable net assets,transaction price will directly affect the size of the purchased goodwill and the transaction price is negotiated by both parties on the basis of the value evaluation of the M&A target,there are many uncertainty may eventually influence the purchased goodwill accounting information quality.However,the existing studies on the value relevance between the purchased goodwill are mainly to directly verify the correlation between the net goodwill and stock price disclosed in the financial statements of listed companies,and there are few analyses on the influencing factors of the value relevance of the goodwill.Therefore,in this paper,from the perspective of M&A,based on the data of China's A-share listed companies from 2016 to 2018,we explored which factors will influence the purchased goodwill and the value relevant of purchased goodwill.We first verify the value relevance of purchased goodwill through the full sample empirical analysis.Based on the perspective of M&A,the samples are grouped to compare the value relevance difference of purchased goodwill.Finally we come to the following conclusion:(1)The purchased goodwill has value correlation and is positively correlated with stock price;(2)The value relevance of goodwill is time-sensitive;(3)The industry in which the target of the M&A is located,the motivation of the M&A,the payment method,and the valuation method for the selection of the target all affect the value relevance of the purchased goodwill recognized in the M&A.