Research On The Risk And Prevention Of Goodwill Impairment In Large M&A Of China Calxon Group Co.,Ltd.

In recent years,more and more listed companies have been pursuing epitaxial growth,and the behavior of M & A is increasing.At the same time,along with the active mergers and acquisitions of listed companies,there is a vast goodwill problem caused by high premium acquisitions.Nowadays,the issue of goodwill has become one of the critical problems affecting the capital market.The problem of goodwill affects the normal development of the market and brings excellent potential risks to the business activities that listed companies plan to implement.Therefore,it is essential to study the M & A goodwill and goodwill impairment risk.China Calxon Group Co.,Ltd group made a cross-border acquisition of star era cinema and Emmy cinema in 2018.Through this acquisition,China Calxon Group Co.,Ltd obtained corresponding theater qualifications and resources,laying the foundation for the development of its secondary industry.However,these theater qualifications and resources did not play the expected role after the acquisition.In 2018,China Calxon Group Co.,Ltd generated total goodwill of about a350 million yuan.At the end of the year of acquisition,an impairment of about a 267 million yuan was accrued for this goodwill.In the same year,the Emmy theater was closed and will not reopen in a short time.In this case,China Calxon Group Co.,Ltd made a full provision for the impairment of the goodwill formed when the Emmy theater was purchased.China Calxon Group Co.,Ltd’s net profit attributable to the parent company in the first three quarters of 2018 was a loss of539 million yuan,while the annual loss was 1.655 billion yuan,and the loss in the fourth quarter exceeded 1billion yuan.The sudden large loss of the company was mainly caused by the impairment of goodwill.A huge amount of goodwill impairment seriously affects the brand image of the enterprise,hurts the reputation of the enterprise,and reduces the confidence of investors in the enterprise.Using the case study method,this paper selects China Calxon Group Co.,Ltd’s cross-border merger and acquisition of star era cinema and Aimei cinema as cases,first introduces the basic situation of the merger and acquisition case,then identifies and evaluates the goodwill impairment risk of China Calxon Group Co.,Ltd,analyzes the causes of the risk,and finally puts forward the corresponding risk prevention measures.According to the ideas of raising problems,analyzing problems,and solving problems,this paper comprehensively analyzes the causes and consequences of goodwill impairment in this case.After such a systematic risk analysis,this paper draws the following conclusions: the main causes of goodwill impairment risk are that China Calxon Group Co.,Ltd’s due diligence before M & A is not sufficient,especially since the valuation of the target company is not rigorous,there is less gold content information disclosed in the asset evaluation report,and the M & a method of one-time M & A itself has risks;After the merger and acquisition,China Calxon Group Co.,Ltd did not integrate resources well,so it did not produce the corresponding synergy.At the same time,it also dragged down China Calxon Group Co.,Ltd’s performance and had a negative impact on its corporate image.Through the analysis of this case,we hope to provide some theoretical basis and practical guidance for the M & A of similar enterprises,to better protect the rights and interests of investors,especially small and medium-sized investors.