IDEAS home Printed from https://ideas.repec.org/a/taf/oabmxx/v10y2023i2p2207877.html
   My bibliography  Save this article

Goodwill impairment and key audit matters

Author

Listed:
  • Inês Gonçalves
  • Ana Isabel Morais
  • Inês Pinto

Abstract

The main goal of this paper is to analyze the factors that influence the auditor’s decision to disclose goodwill impairment as a key audit matter (KAM). For this analysis, we use a logit model to determine the factors that influence auditors’ disclosure of a goodwill impairment as a KAM. Our sample comprises 92 companies listed in the stock market indices of Germany (DAX 30), Belgium (BEL 20), Spain (IBEX 35), France (CAC 40), the Netherlands (AEX), and Portugal (PSI 20) as of the 2017 fiscal year-end. The results show that in highly profitable companies or in those with strong corporate governance, the auditor is less likely to disclose goodwill impairment as a KAM. Findings also show that the economic significance of goodwill holds significant influence over the auditor’s decision-making even in companies with strong governance structures. The contribution of this paper is the provision of direct evidence on what motivates auditors to disclose goodwill impairment as a KAM. Findings show a direct relationship between profitability, corporate governance, and the disclosure of goodwill impairment as a KAM.

Suggested Citation

  • Inês Gonçalves & Ana Isabel Morais & Inês Pinto, 2023. "Goodwill impairment and key audit matters," Cogent Business & Management, Taylor & Francis Journals, vol. 10(2), pages 2207877-220, December.
    • Handle: RePEc:taf:oabmxx:v:10:y:2023:i:2:p:2207877
    DOI: 10.1080/23311975.2023.2207877
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/23311975.2023.2207877
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/23311975.2023.2207877?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:oabmxx:v:10:y:2023:i:2:p:2207877. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://cogentoa.tandfonline.com/OABM20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.