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IFRS® Accounting Standards

Business Combinations – Disclosures, Goodwill and Impairment

Summary

The Accounting Standards Board (AcSB) is participating in the International Accounting Standards Board’s (IASB) project to investigate possible improvements to IFRS 3 Business Combinations and IAS 36 Impairment of Assets.

Goodwill reflects expected future economic benefits produced by assets acquired in a business combination that are not recognized separately. An entity that holds goodwill is currently required to assess at least annually whether it is impaired.

Staff Contact(s)

Jayshal Rajendra Daya, CPA, CA Principal, Accounting Standards Board

Phone number  +1 416 204 3501
Email address  [email protected]
Mark Squire, CPA, CA Principal, Accounting Standards Board

Phone number  +1 647 264 3810
Email address  [email protected]

Project Status

  • Information gathering

    Completed prior to September 2016

  • Approving project

    The IASB added the project to its research agenda in February 2015

  • Consulting stakeholders

    The IASB issued a Discussion Paper, Business Combinations—Disclosures, Goodwill and Impairment in March 2020

    Virtual roundtable discussions held in July and September 2020

    Discussion Paper
  • Deliberating feedback

    The AcSB submitted its response letter to the IASB in December 2020

    The IASB is currently deliberating comments on their Discussion Paper

    In March 2023, the IASB made several tentative decisions on the project, that included:

    • changes to IAS 36 Impairment of Assets to reduce the cost and complexity of the impairment test of cash-generating units containing goodwill; and

    • the removal of some disclosure requirements from IFRS 3 Business Combinations

  • Final pronouncement

News

January 13, 2021

International Activity

AcSB Response – Business Combinations—Disclosures, Goodwill and Impairment

On December 16, 2020, the AcSB responded to the IASB’s Discussion Paper, issued in March 2020. The IASB’s proposals take significant steps forward towards improving the accounting for goodwill and enhancing the relevance of information about acquisitions. The AcSB’s letter encourages the IASB to consider areas where additional guidance is needed to address possible application challenges that may arise. Read our letter to find out more!

April 21, 2020

International Activity

UPDATE – IASB amends workplan and timelines

On April 17, 2020, the IASB voted to issue an Exposure Draft with a 30-day comment period proposing to extend by one year the effective date of an amendment to IAS 1 Presentation of Financial Statements. The IASB also decided to extend by three months the comment period for: Exposure Draft, General Presentation and Disclosures, Request for Information Comprehensive Review of the IFRS for SMEs Standard and Discussion Paper, Business Combinations – Disclosures, Goodwill and Impairment. The IASB also deferred the timelines for various upcoming consultation documents and final amendments.  See the IASB’s workplan for more information.

April 14, 2020

International Activity

IASB Snapshot – IFRS® Standards Discussion Paper, Business Combinations—Disclosures, Goodwill and Impairment

How can companies provide a financial statement user with better information about business combinations? The IASB’s Discussion Paper: Business Combinations—Disclosures, Goodwill and Impairment investigates this through possible improvements to IFRS 3 Business Combinations and IAS 36 Impairment of Assets. Don’t have time to read the Discussion Paper? The IASB’s Snapshot provides an easy-to-understand overview of this paper that can help support you as you form your views on the proposals. Read it today!

Meeting & event summaries

October 27, 2020

AcSB Decision Summary – October 27, 2020

The AcSB began discussing the key issues to include in its response letter to the International Accounting Standards Board (IASB’s) Discussion Paper, “Business Combinations—Disclosures, Goodwill and Impairment.” As part of the discussion, the Board considered stakeholder feedback obtained to date through its outreach on this topic. The Board will consider the results of remaining stakeholder outreach and discuss a draft of its response letter at its December meeting.

The AcSB encourages stakeholders to share their views on the Discussion Paper by submitting their response letters to the IASB by December 31, 2020, with a copy to the AcSB. If respondents would like the Board to consider their comments when drafting its letter to the IASB, they should submit their response letters to the AcSB by November 30, 2020, to allow the Board adequate time to consider the feedback in its response letter.

June 16, 2020

AcSB Decision Summary – June 16, 2020

The AcSB received an education session on the International Accounting Standards Board's Discussion Paper, “Business Combinations—Disclosures, Goodwill and Impairment.” The Board also received an update on the remaining outreach planned for the Discussion Paper, including virtual roundtables planned for July and September 2020.

March 3, 2020

AcSB Decision Summary – March 3-4, 2020

The AcSB approved the preliminary plan to respond to the International Accounting Standards Board’s (IASB) upcoming discussion paper related to the Goodwill and Impairment project. The Board also discussed the communication activities it will undertake related to this project. The IASB expects to issue its discussion paper in March 2020.

January 29, 2020

AcSB Decision Summary – January 15, 2020

The AcSB considered a preliminary plan to respond to the International Accounting Standards Board’s (IASB) upcoming discussion paper related to its Goodwill and Impairment project.

The IASB expects to issue its discussion paper in February 2020.

The AcSB will discuss the communication activities related to this project and the final plan to respond to the discussion paper once the IASB issued it.

Disclaimer

This project summary has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on this project, which may change after further Board deliberations. Decisions to publish Handbook material are final only after a formal voting process.