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Proactive Project on Goodwill

The ASBJ, EFRAG and OIC jointly publish the Discussion Paper “Should Goodwill Still Not Be Amortised? – Accounting and Disclosure for Goodwill”, to contribute to the global discussion of how goodwill should be accounted for and disclosed.


Under IFRS, goodwill arising from a business combination is not amortised but subject to an annual impairment test. There has been a long debate on the strengths and weaknesses of the impairment-only model. In view of the increased attention from constituents, and the ongoing post-implementation review of IFRS 3, members of the staff from the ASBJ, EFRAG and the OIC formed a Research Group to study issues relating to accounting and disclosure requirements of acquired goodwill set forth in IFRS 3 Business Combinations and IAS 36 Impairment of Assets and developed a Discussion Paper (DP) to seek public comments. Based on the work to date, the ASBJ, EFRAG, and the OIC reached the view that the paper would stimulate useful debate.


The views presented in the DP are those of the Research Group’s only. In this DP, the Research Group explores possible approaches to remedy the shortcomings that constituents identified by considering one or a combination of the following: (a) changing the accounting requirements of goodwill, (b) improving the requirements for impairment testing, and (c) improving the disclosure requirements in IAS 36. As a result of its analysis, the Research Group concluded that reintroduction of amortisation of goodwill would be appropriate.


The ASBJ, EFRAG and OIC invite comments in English with the comment period due by 30 November 2014. All comments will be on the public record and posted on websites unless the respondent specifically requests confidentiality.


The Research Group hopes that this DP will help stimulate the discussion of the matters, and plans to share the feedback received on the DP with the IASB and other relevant bodies and to consider further improvements in this area.

On 4 February 2015 OIC, EFRAG and ASBJ jointly published a feedback statement summarising comments received on the Discussion Paper. In response to Discussion Paper, the Research Group received twenty nine comment letters and is now issuing a feedback statement which describes the main comments that it received. The majority of respondents supported that amortisation of goodwill should be reintroduced, but also pointed out that there were areas for improvement in the impairment testing.

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