Accounting Rules

NEW ACCOUNTING FOR BUSINESS COMBINATIONS, INTANGIBLES AND GOODWILL IMPAIRMENT A presentment for the Suffolk and Nassau Chapters of the New York State Society of CPAs chronicle and Auditing All-Day Update November 9, 2002 Russell T. Glazer, CPA apprised Business Appraiser Horowitz, Waldman, Berretta & Maldow, LLP 1000 Woodbury pathway Woodbury, New York, 11797 (516) 364-4567 INTRODUCTION During the 1980s and 1990s a great image of backup mergers and acquisitions took place. The generally accepted invoice principles to record the initial exertion and to account for the acquired pluss during their estimated useable lives this were well established. Over date however, users of financial statements began to question whether those principles and practices accurately reflected the market realities regarding the assets, their useful lives and their parcel to a companys survey. In addition, intangible assets have beco me increasingly more important as an economic resource. It was apparent that users of financial statements did not accept that goodwill amortization expense provided useful information.

They complete that treating goodwill as a wasting asset whose value deteriorates predictably over a fixed stopover of beat ignored the economic realities. Goodwill, in fact, fuel be replenished and increase in value; alternatively, the value of goodwill can shine precipitously in a short accomplishment of time. During the 1970s the FASB had an active intercommunicate on its agenda to retrospect the accounting for business combinations and acquired intangible assets. However, action on the project was deferred until, in 1981, the ! stand on removed the project from its agenda entirely, to direction on higher priority projects. In 1986 the Financial Accounting Standards Board (FASB) included the project on business combinations on its agenda. The train was to improve the transparency of accounting and reporting of...If you ask to get a full essay, order it on our website: OrderEssay.net

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