Acquisition Goodwill Impairment Risk Under Performance Commitments Of Shijia Technology Research

The socialist market system and mechanism with Chinese characteristics are constantly improving.The premium mergers and acquisitions and reorganization activities of listed companies in my country are common.The goodwill value of listed companies due to mergers and acquisitions has also been accumulated.The risk of "thunderstorm" for goodwill impairment is dormant under these mergers and acquisitions,so how should we prevent this risk?Many listed companies choose to sign performance compensation commitment agreements with the M&A parties to prevent the risk of goodwill impairment in M&A transactions.However,in practical applications,the performance commitment may also have a reaction for preventing the risk of goodwill impairment,that is,not only does not play a preventive role,but has produced the role of promoting the valuation of mergers and acquisitions.Essence Therefore,the enterprise’s performance commitment system wants to achieve the target effect rather than the manufacturing negative effect.It is worth exploring.How to reasonably use the performance compensation commitment agreement at different stages to prevent the risk of impairment of mergers and acquisitions.Performance commitments under the risk of mergers and acquisitions.This paper starts with the research background and significance,counts the literature review related to the research direction of this paper,explains the professional concepts and theoretical basis involved in this paper,and provides theoretical basis for the following case studies.The case study object of this paper is Suzhou Shijia Science & Technology Inc.(hereinafter referred to as Shijia Technology),starting from the case of its acquisition of Suzhou Perfect Electronics Technology Co.,Ltd.(hereinafter referred to as Perfect)Summarize the merger and acquisition process of Shijia Technology,analyze the goodwill profile,performance commitments and goodwill impairment caused by the merger and acquisition.It is found that the amount of performance commitment of Shijia Technology is reasonable,but the performance commitment is not up to the standard and the goodwill impairment is still incurred.In-depth study of Shijia Technology’s goodwill,goodwill impairment causes,goodwill impairment caused by the adverse economic consequences.It was found that Shijia Technology did not make good use of performance commitment to prevent the risk of goodwill impairment.Therefore,this paper continues to explore the risk of goodwill impairment under the performance commitment of Shijia Technology.Taking the performance commitment signing as the dividing line,this paper analyzes the risks before and after the signing of the agreement,and divides the relevant risks into three stages,including the goodwill impairment risk before the signing of the performance commitment,when the performance commitment is fulfilled and after the expiration of the performance commitment.Finally,some suggestions on how to use performance commitment to prevent the risk of goodwill impairment in different periods are put forward in order to provide some reference suggestions for similar enterprises to prevent the risk of goodwill impairment in mergers and acquisitions in different periods.