IOSCO publishes recommendations on the accounting for goodwill
15 Dec 2023
The International Organization of Securities Commissions (IOSCO) has published a report 'Recommendations on Accounting for Goodwill' for issuers, audit committees, and external auditors aimed at enhancing the reliability, faithful representation and transparency of goodwill recorded and disclosed in the financial statements.
IOSCO believes that the recommendations contained within the report will also be useful to standard setters, including the International Accounting Standards Board (IASB), as they pursue initiatives to enhance business combination disclosures and related matters of goodwill impairment testing.
IOSCO reminds issuers of the importance that their accounting and disclosures result in a fair and transparent presentation of the financial position, performance and cash flows of the company. The report notes:
This means the goodwill should not be stated at an amount in excess of its recoverable amount, that impairment losses should be recognised in a timely manner, and that disclosures of significant judgements and key assumptions related to the recoverability be transparent.
Please click to access the report on the IOSCO website.
