How could one justify paying $8 billion for Kohls, which has a market value of $1.5 billion? What do the potential new owners see?
Is a goodwill impairment a leading indicator, or lagging? Why do you think impairments are on the rise?
So, the oil firms have fewer goodwill impairments due to rebounding oil prices. Are they allowed to reverse any of these impairments? Should they be allowed to do so? Why or why not?
So Staples’ results were impacted by goodwill impairment and restructuring charges. What are the economic implications of these accounting charges? What are the recognition criteria for these accounting charges?
Can you connect the dots between exchange rates and goodwill impairments? Are the effects related to FX transactions or translations?
Do you think you could have predicted the goodwill impairments for these German firms? What would make good predictors?
What accounting measurement and reporting issues are particularly applicable to firms with fewer fixed assets?
How is a “bad” M&A deal reflected in accounting measures? Do you think firms do pay more for a target in anticipation of being able to carry out the integration efficiently and effectively?
Can you write down in simple equation form how goodwill impairments are currently measured and how they are proposed as being measured (step 2 of the impairment test)? Can you articulate how the proposed test will make it much easier for firms?
Do you think the proposed goodwill impairment test will result in major changes in the magnitude of goodwill impairment charges? Will it matter to the capital markets if this proposal is passed?
Can you describe briefly the goodwill impairment test? Can you describe the economic reasons for a goodwill impairment? Why would a firm’s stock price be affected by a goodwill impairment?
Can you replicate Microsoft’s $6.2 charge? Is the charge a leading or a lagging indicator for the marketplace?
Who wanted the goodwill impairment test changed? Preparers? Auditors? Users? Will the changes result in “better” information?
P&G’s profit dropped 49% from the previous quarter. How do you think the stock price would react to the information? On what does any reaction depend? Is a goodwill impairment a leading or lagging indicator?
Do you believe the European banks are intentionally delaying write-downs of goodwill? If so, why? If any delay were to go against IFRS, who should enforce the standards?
