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11/09/2020 - Your opinion matters – Questionnaire for preparers – How could accounting for goodwill be improved?

EFRAG launches a questionnaire/invitation for an interview for preparers with active M&A agendas or material goodwill amounts in the financial statements. The purpose is to collect input on the proposals in the Discussion Paper Business Combinations—Disclosures, Goodwill and Impairment and on EFRAG’s suggestions included in its draft comment letter. 


​The IASB has issued a Discussion Paper Business Combinations—Disclosures, Goodwill and Impairment. EFRAG is collecting European views on the proposals in the Discussion Paper to influence future accounting requirements. As part of our consultation, we are contacting preparers with an active M&A agenda or with material goodwill amounts on the statement of financial position in order to have their views on the usefulness and practicability of the disclosures proposed by IASB and on potential improvements to the goodwill impairment test as suggested by EFRAG in its draft comment letter. 

Acquisitions are often large transactions. Users are highly interested in information about such transactions. The aim of the Discussion Paper is to explore whether companies can, at a reasonable cost, provide investors with more useful information about the acquisitions those companies make. According to the Discussion Paper a company should be required to disclose information about its objectives for an acquisition and, in later periods, information about how that acquisition is performing against those objectives. Such information would help investors to hold that company's management to account for its acquisition decisions.

The disclosures are based on a managerial view of the expected and achieved results of a given business combination. There is currently significant debate about the consequences of including these disclosures in the notes (i.e. not only in the management commentary and subject to audit). 

In addition, EFRAG is seeking the views of preparers and M&A experts on the IASB proposals and EFRAG's suggestions which relate mainly to potential improvements and simplifications of the goodwill impairment test to address the 'too little too late' issue and to reduce complexity of the test. 

The view of preparers is key to influence the standard setting process. We would highly appreciate if preparers would take the time and participate by answering a questionnaire (30 min) or, if preferred, to participate in an interview to discuss the project.

How you can provide your views? You would have two options:  

  • You could access the questionnaire by clicking here (a preview of the questionnaire is avialable in pdf-version here)
  • If you prefer a short interview, please send us an email to this email address: BusinessCombinations@EFRAG.ORG. We will set up a one-to-one meeting for commenting on the issues included in our draft comment letter. 
Responses on the survey are requested by 26 October 2020.
Background information: EFRAG has issued a draft position before running the consultation process in relation to the IASB's Discussion Paper. The draft position is available here