AASB 3 makes no attempt to explain the presence of goodwill when the share acquisition is first made.

Question

Quizplus · Accepted Answer

AASB 3 deals with the accounting treatment of goodwill after the initial acquisition of shares, but it does not discuss the reasons or factors that lead to the recognition of goodwill in the first place. The determination of goodwill is a matter of judgement and assessment of various intangible assets, such as reputation, brand, customer relationships, and intellectual property, that are expected to contribute to the future earnings and cash flows of the acquired business.

AASB 3 Makes No Attempt to Explain the Presence of Goodwill