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Do you think goodwill should appear on the new company's statement of financial position after a takeover?

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Question added by Deleted user
Date Posted: 2013/09/24
Rajesh Perumbadari
by Rajesh Perumbadari , Joint Venture Audit Accountant , Kuwait Foreign Petroleum Exploration Company

Not compulsorily.  Depends on the purchase consideration.  If PC is less than net value, it can be negative goodwill (capital reserve).

Muawia Alhadrab
by Muawia Alhadrab , Assistant Manager , Ernst and Young (EY)

if the cash paid > the net value of assets for the company it should be reported as good will

if the cash paid < the net value of assets for the company it should be reported as gain in the income statement.

Prince Ninan
by Prince Ninan , Audit Executive , Lewis & Pecker

Yes, if purchase consideration is more than the value of net assets taken over

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