In accounting & tax, goodwill means: An intangible asset that arises when a company buys another business for more than the fair value of its identifiable net assets.
In Turkish: şerefiye
How it is used
Recognised only in acquisitions, never for a company's own reputation. Under IFRS goodwill is not amortised but tested for impairment every year.
Example sentences
The acquisition created goodwill of 150 million lira.
A large part of the price we paid was recorded as goodwill.
Common collocations
goodwill impairment
goodwill on acquisition
negative goodwill
recognise goodwill
Related terms
intangible assetAn asset with no physical form that still has value for the business, such as software, patents, trademarks, licences or customer relationships.
impairmentA fall in the value of an asset below the amount shown in the books, recorded as a loss so that the asset is not overstated.
fair valueThe price that would be received to sell an asset, or paid to transfer a liability, in a normal transaction between market participants on a given date.
consolidated financial statementsFinancial statements that combine a parent company and all the subsidiaries it controls as if they were one single business.
