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Theoretical bases on the nature of goodwill

Author

Listed:
  • Sarra KAISS

    (National School of Trade and Management, University Hassan 1st, Settat, Morocco.)

  • Nezha BAGHAR

    (National School of Trade and Management, University Hassan 1st, Settat, Morocco.)

  • Mounime EL KABBOURI

    (National School of Trade and Management, University Hassan 1st, Settat, Morocco.)

Abstract

Goodwill has been for over a decade a subject of debates and discussions trying to define the concept: its definition, its nature, its recognition. Indeed, the state of research witnesses to the abundant studies using different methodologies. Through this article we will try to make an overview to discuss the concept, its composition and classification. Beginning with a historical overview describing the appearance and theories related to goodwill, this article will be an overview that attempts to bring opinions and definitions given by researchers and then analyze the factors that determine the motivations of the managers of an acquiring company to pay more to the acquired firm the goodwill. In all these definitions, we present a critical opinion to obtain a theoretical and understandable basis for goodwill

Suggested Citation

  • Sarra KAISS & Nezha BAGHAR & Mounime EL KABBOURI, 2017. "Theoretical bases on the nature of goodwill," Turkish Economic Review, KSP Journals, vol. 4(4), pages 419-428, December.
    • Handle: RePEc:ksp:journ2:v:4:y:2017:i:4:p:419-428
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    References listed on IDEAS

    as
    1. Berkovitch, Elazar & Narayanan, M. P., 1993. "Motives for Takeovers: An Empirical Investigation," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 28(3), pages 347-362, September.
    2. Ron Shalev & Ivy Xiying Zhang & Yong Zhang, 2013. "CEO Compensation and Fair Value Accounting: Evidence from Purchase Price Allocation," Journal of Accounting Research, Wiley Blackwell, vol. 51(4), pages 819-854, September.
    3. Charlotte Disle & Rémi Janin, 2007. "La norme IFRS 3 a-t-elle amélioré le contenu informatif du goodwill ?. Étude des amortissements et des dépréciations du goodwill des groupes du SBF 250 sur la période 2001-2005," Comptabilité - Contrôle - Audit, Association francophone de comptabilité, vol. 13(3), pages 247-267.
    4. Healy, Paul M. & Palepu, Krishna G., 2001. "Information asymmetry, corporate disclosure, and the capital markets: A review of the empirical disclosure literature," Journal of Accounting and Economics, Elsevier, vol. 31(1-3), pages 405-440, September.
    5. Marco Giuliani & Daniel Brännström, 2011. "Defining goodwill: a practice perspective," Journal of Financial Reporting and Accounting, Emerald Group Publishing Limited, vol. 9(2), pages 161-175, October.
    6. Henning, SL & Lewis, BL & Shaw, WH, 2000. "Valuation of the components of purchased goodwill," Journal of Accounting Research, Wiley Blackwell, vol. 38(2), pages 375-386.
    7. Bernard Martory & Françoise Verdier, 2000. "Comment traiter le goodwill? Pratique d'une théorie, théorie d'une pratique," ACCRA, Association francophone de comptabilité, vol. 6(2), pages 175-193.
    8. Lee, Cheol, 2011. "The effect of SFAS 142 on the ability of goodwill to predict future cash flows," Journal of Accounting and Public Policy, Elsevier, vol. 30(3), pages 236-255, May.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Goodwill; Theory of goodwill; Intangible; Residue; Super profit; Managers; Agency theory; Overpayment; Performance.;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • N80 - Economic History - - Micro-Business History - - - General, International, or Comparative
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government

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