AASB 138 contains some elements that seem to be reactions to opportunistic behaviour by preparers of accounts and to the degree of uncertainty surrounding goodwill as an unidentifiable intangible asset.These elements include:

Question

Quizplus · Accepted Answer

AASB 138 prohibits the recording of internally generated goodwill and specifies impairment testing as a reaction to opportunistic behavior by preparers of accounts who may overstate the value of internally generated goodwill. The requirement to use a specific rate of amortisation is not mentioned as a reaction to such behavior or to the uncertainty surrounding goodwill as an unidentifiable intangible asset. Therefore, option D is the correct answer.

AASB 138 Contains Some Elements That Seem to Be Reactions