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Accounting Research Tool
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Chapter 1 — Overview and Scope

1.2 History of the Goodwill Impairment Model and Related Standard-Setting Activity

1.2 History of the Goodwill Impairment Model and Related Standard-Setting Activity

ASC 350-20 provides guidance on accounting for goodwill after its initial recognition. Under that guidance, goodwill is tested for impairment at least annually (unless the entity has elected the goodwill accounting alternative to amortize goodwill), or more often if events or circumstances indicate that it might be impaired. The current goodwill accounting model has evolved significantly from the model that the FASB originally introduced in 2001. The FASB has issued numerous ASUs on this topic, which were generally intended to simplify or reduce the cost and complexity of performing goodwill impairment testing. The following timeline depicts standard-setting activity related to the subsequent accounting for goodwill.