Research On The Premium M&A Risk Of TIAN SHEN ENTERMENT From The Perspective Of Goodwill

In our market,the total number of premium M&A is increasing,the income from premium paid by an enterprise is recorded as "asset-goodwill" in the statement,that is,acquisition goodwill.The total number of acquisition goodwill is also increasing.At the same time,there are more and more loss events caused by the large impairment of acquisition goodwill,which reflects that some enterprises make mistakes in the investment decision of premium M&A.In addition,the effect of integrating M&A resources of many enterprises without goodwill impairment is not good,and there are problems in business development.This is also the risk that premium M&A brings to enterprises.The current goodwill treatment method of impairment test does not help enterprises to reduce these risks,nor prompt them in time.Therefore,we can find a more appropriate way to deal with goodwill by understanding the process of the generation and change of premium M&A risk,as well as the impact on enterprises.This will help enterprises to reduce the risk of premium M&A and early warning risk in time.Therefore,through the case of TIAN SHEN ENTERMENT premium M&A,this paper analyzes the generation and early warning of risks under the goodwill impairment test method and amortization method,hoping to find a more reasonable way to deal with goodwill,and provide some suggestions for the risk management of premium M&A.This paper first discusses the causes and early warning theory of premium M&A risk,and analyzes the emergence of premium M&A from the perspective of goodwill,as well as the changes of goodwill after M&A and its impact on enterprises.The purpose of paying premium is to obtain the self-created goodwill of the acquired enterprise and form the synergy effect,then absorb and integrate resources to form self-created goodwill,which will bring excess earnings to the enterprise.The management will increase the premium due to personal interests and other reasons.The unreasonable premium can not bring benefits to the enterprise,but the enterprise also paid for it.This kind of error is the source of premium M&A risk.Therefore,acquisition goodwill represents the self-created goodwill,synergy and error of the acquired enterprise.The decrease of acquisition goodwill indicates that enterprises absorb and integrate resources and achieve synergy effect to form their own self-created goodwill,improve their performance,and errors begin to have a negative impact on enterprises.The amortization method can reflect the essence of the change of acquisition goodwill more than the impairment test method.On the basis of these theoretical analysis,this paper gives a brief introduction to the process of TIAN SHEN ENTERMENT premium M&A,and analyzes the causes of risk.Then,through the impairment test of TIAN SHEN ENTERMENT and financial data,this paper analyzes the risk of goodwill impairment and business development,and finds that the impairment test makes the risk higher and can not warn the risk in time.Then,this paper puts forward the goodwill amortization method as a countermeasure.Amortization method reduces risk by reducing earnings management space and unreasonable premium.At the same time,the change trend of acquisition goodwill under the amortization method is more closer to its essence.Therefore,the change of corporate performance can reflect the impact of premium M&A on it.By analyzing the change of corporate performance,risk can be timely warned.Finally,this paper concludes that:(1)under the impairment test method,there is a higher premium M&A risk and it can not be early-warning in time.(2)The amortization method can reduce and timely warn risks.In addition,some suggestions are put forward.We should increase the practicability of goodwill amortization method and replace impairment test method.We should reasonably evaluate the target enterprises,strengthen external supervision,improve information disclosure and enterprise mechanism.