FRF7
Syllabus D. PREPARATION OF FINANCIAL STATEMENTS D2efg. Calculating Goodwill

D2efg. Basic Goodwill Calculation 1 / 5

Syllabus D2efg)

e) Account for the effects of fair value adjustments (including their effect on consolidated goodwill) to:

i) depreciating and non-depreciating non-current assets
ii) inventory
iii) monetary liabilities
iv) assets and liabilities not included in the subsidiary’s own statement of financial position, including contingent assets and liabilities

f) Account for goodwill impairment.

g) Describe and apply the required accounting treatment of consolidated goodwill.

This is calculated on the date of acquisition of the sub

It represents the intangible reputation / customer base etc of the sub

It is calculated as follows:

FV of Consideration X
NCI X
FV of Net Assets Acquired (X)
Goodwill X