Many companies carry "goodwill" on their balance sheet as an asset. As a result, like all assets, goodwill must be valued correctly on the company's balance sheet in order for it to provide accurate information to investors and to the public. When the 'carrying value' of goodwill (the value reported on the balance sheet) is less than the fair market value, the goodwill is "impaired" and its value must be reduced. Goodwill impairment testing is thus required annually by financial accounting[...]
AN ATTORNEY'S GUIDE TO GOODWILL IMPAIRMENT TESTING
Posted in
goodwill impairment testing,,
financial analysis,
on Dec 2011,
by: Mark Gottlieb
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