Open AccessAn Empirical Evaluation Of Goodwill Accounting
Author(s) -
Zhemin Wang
Publication year - 2011
Publication title -
journal of applied business research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.149
H-Index - 22
eISSN - 2157-8834
pISSN - 0892-7626
DOI - 10.19030/jabr.v9i4.6003
Subject(s) - goodwill , amortization , accounting , financial statement , business , period (music) , economics , debt , finance , physics , audit , acoustics
While the current amortization period for goodwill is criticized by many financial statement preparers for being too short, the accounting profession and regulatory bodies indicate the intention of further reducing the amortization period. This study documents consistent evidence suggesting that any attempt to significantly shorten the amortization period may impose an unfair penalty on firms with goodwill assets and cause the reported goodwill to be significantly understated.