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Impairment CGU

This topic has 2 replies, 2 voices, and was last updated 1 year ago by agboolakenny84.

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June 17, 2021 at 8:59 pm #625615
agboolakenny84
- Topics: 18
- Replies: 81
Hello Tutor,
Thank you for your lectures.
I’m quite confused as to why you impaired the whole Goodwill of 2400. I didn’t really understand the explanation of why you impaired the whole of 2400.
Thank you.
June 19, 2021 at 7:53 am #625773
P2-D2
Keymaster
- Topics: 4
- Replies: 6115
Hi,

Thanks for the comment regarding the lectures. In any impairment then goodwill is the first thing to go as it has effectively been recognised in the accounts based on the excess paid to acquire a business. It does not represent anything specifically within the business, i.e. it is not identifiable, and hence on any impairment it has to be removed.

Thanks
June 19, 2021 at 11:55 am #625806
agboolakenny84
- Topics: 18
- Replies: 81
Thanks !
This is a clearer explanation. I understand now.
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