IFRS – 03

This topic has 1 reply, 2 voices, and was last updated 4 years ago by P2-D2.

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November 22, 2021 at 6:14 pm #641337
saadathar14
Participant
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Hello Sir,

How can a business be purchased at the value less than the value of its net assets which is called The Negative Goodwill. Does it happen in real life too?

Thanks in advance!
November 27, 2021 at 7:42 am #641746
P2-D2
Keymaster
- Topics: 4
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Hi,

Yes, it does happen as the purchaser is paying more as they believe that they can make the business successful in the future. Think of it as a bargain purchase.

Thanks
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