Negative goodwill recognize on income statement with the requirements :
1. Goodwill should be recognized as income when company get identified loss in the future and cost occur if expectation of loss in the future and cost can identified in acquisition planning. 2. If negative goodwill less than fair value of non-monetary assets that acquired should be recognize as income for average remainder remaining life of asset. But if negative goodwill more than fair value of non-monetary assets that acquired should recognized as soon income. 6.1.2. Uniting of Interest Unity of interest should responsibility with pooling of interest method. Financial statement accounts from business combination for acquired dated should include in business combination’s financial statement likely they had joined since beginning period. Expenditure for business combination record as expense. 6.2. Business Combination Disclosure IAS No. 22 require several disclosure that should disclose in business combination, that are : 1. Name and detail of acquired company 2. Accounting method 3. Every operation which resulted from business combination has decided to delete a certain business 4. Certainty transition which implemented on completion first annually financial statement. 6.2.1. Additional Disclosure on Acquisition That are the additional disclosure on financial statement for acquisition period : 1. Percentage of ownership 2. Acquisition cost and detail from price of purchase 3. If fair value of assets and liabilities or purchase price can determine only based on temporary, it should recognize and explain reason. Furthermore adjustment should disclosure and recognized
4. The amount of all certainty for finished is reduced acquisition activities should disclose for every individual business combination. Accounting treatment for goodwill and negative goodwill disclosure : 1. If goodwill amortized for more than 20 years, it should has evidence that the remaining life of goodwill is not 20 years. 2. If goodwill don’t amortize with straight-line method, it should has right basis and certain reason than use straight-line method. 3. IAS 22 postpone negative goodwill, characteristic, amount and time from future expected loss and cost. Item in income statement that goodwill amortize or disclose of negative goodwill included.
- Spring '20
- Balance Sheet, Generally Accepted Accounting Principles, joint venture