FRS11 Goodwill

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
I've finally burnt out. My brain can't take anymore!!<BR><BR>Can someone please explain how FRS11 is relevant to Goodwill that has an indefinate useful economic life and how we would treat in the the accounts?<BR>I'm trying to do the specimen paper, I've read the answer that the AAT has given and I still don't get it.<BR><BR>I think that panic has now set in and I can't see the trees for the woods.<BR><BR>I'm heading one of 2 ways either nervous breakdown or alcoholic!!!<BR><BR>HELP!!!!<BR>

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    FRS11 Goodwill

    Hi.<BR><BR>Goodwill should be amortised (another term for depreciation).<BR><BR>If it is not amortised it should be shown at the cost of acquisition (how much was it worth when bought).<BR><BR>However at the end of each reporting period it should be 'reviewed for impairment' (FRS 11 Impairment of Fixed Assets & Goodwill).<BR><BR>If there has been a reduction in the value of Goodwill this must be reflected in the accounts.<BR><BR>So, if Goodwill is not amortised it must be reviewed.<BR><BR>Scott.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    FRS11 Goodwill

    I know I'm going to sound really thick now, but does this mean that on our consolidated balance sheet we will always have the goodwill showing in our intangible assets, but at the reviewed value. <BR><BR>Sorry for the stupid question, but I'm really not getting the understanding of this and I'm really starting to panic.<BR>

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