Question

how should write down of goodwill be reported? what information should be disclosed related to goodwill? sony has two businesses with different financial trends,should consolidated financial statements provide specific segment discosure information? what should the company disclose? reporting insufficient information or excluding required disclosure can be misleading or perceived as unethical.what ethical standards are applicable to sony's reporting?

Answer 1

Reporting of Goodwill :

Good­will can be re­cog­ni­zed as an in­tan­gib­le as­set only if it is ac­qui­red in a bu­si­ness com­bi­na­tion. In­ter­nally ge­ne­ra­ted good­will can not be ca­pi­ta­li­zed in the ba­lan­ce sheet. Good­will can not be ca­pi­ta­li­zed be­cau­se it is not iden­ti­fiab­le, it has an in­de­termi­na­te use­ful life and it is not se­pa­rab­le from ot­her as­sets. In­tan­gib­les are iden­ti­fiab­le when they re­sult from con­tractual or le­gal rights or are se­pa­rab­le. In­tan­gib­les that are not iden­ti­fiab­le are re­cog­ni­zed as part of good­will

Disc­losure :

The users of fi­nan­cial in­for­ma­tion feign more and more in­for­ma­tion about the fi­nan­cial re­sults of com­pa­nies day af­ter day. Trans­pa­rent fi­nan­cial in­for­ma­tion also inc­lu­des disc­lo­su­res re­la­ted to good­will. Ac­cor­ding to the new good­will treat­ment the­re were chan­ges also re­gar­ding the re­que­sted disc­lo­su­res about good­will. The new ac­coun­ting treat­ment at the in­di­vi­dual re­por­ting unit (or cash-ge­nera­ting unit) is an op­por­tu­nity to pro­vi­de a more transpa­rent fi­nan­cial disc­lo­su­re about good­will im­pair­ment.

consolidated financial statements provide specific segment discosure information.:

Paragraphs 39-46 specify the disclosures required for reportable segments for primary segment reporting format of an enterprise. Paragraphs 47-51 identify the disclosures required for secondary reporting format of an enterprise. Enterprises are encouraged to make all of the primary-segment disclosures identified in paragraphs 39-46 for each reportable secondary segment although paragraphs 47-51 require considerably less disclosure on the secondary basis. Paragraphs 53-59 address several other segment disclosure matters