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Topic: Business
Number of pages / Number of words: 8 / 2122
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However, the balance sheet of an acquisitive group could become ended quickly, which could give the impression that the group has very low or even negative net worth, by using this treatment (Seetharaman et al. 2004). This could reduce user’s understandability as the financial statements could lead to misinterpretation of a company’s financial position...


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2004). This could reduce user’s understandability as the financial statements could lead to misinterpretation of a company’s financial position.

As Goodwill is not measurable and has no true future value, some argue that it therefore should be written off against reserves (Sundararajan 1995). However, writing off goodwill instantly is inaccurate, as the value of goodwill does not decrease immediately, which reduces the relevance of this method...


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