Two cases in independent assessment of impairment testing robustness

Tyrone M. Carlin, Nigel Finch, Guy Ford

Research output: Contribution to journalConference paperpeer-review


The adoption of IFRS based reporting in Australia for all reporting periods commencing 1 January 2005 onwards resulted in substantial variations to prior accepted reporting practices. One area in which change was particularly profound was in the shift to an impairment testing based regime for goodwill accounting and reporting. The IFRS framework requires substantially greater levels of disclosure about the assumptions brought to hear in sustaining a valuation for goodwill. At face value, this should have resulted in improved transparency and the availability of higher levels of decision useful information. However, a review of disclosures relating to goodwill and its impairment by a sample of large Australian reporting entities in the first year after the transition to IFRS suggests substantial room for improvement. In particular, required disclosures were frequently omitted, or suggested that the technical requirements of the IFRS goodwill impairment testing process had not been complied with. Consequently, it is concluded that at present, it is in exceptional cases rather than a matter of generality that IFRS compliant disclosures sustain improved insights and support better decision making by financial statement users.
Original languageEnglish
Pages (from-to)1-9
Number of pages9
JournalProceedings of the 9th Asia-Pacific Decision Sciences Institute Conference
Publication statusPublished - 2007
EventInternational Decision Scineces Institute Conference (9th : 2007) - Bangkok, Thailand
Duration: 11 Jul 200715 Jul 2007


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