THE GOODWILL IN VALUATION OF COMPANIES: A Study on the Impairment Tests and Changes in Accounting Scope of Business Combinations

This article describes the main changes to the international accounting standards with respect to goodwill and its possible implications on accounting information disclosed. Furthermore, this study characterizes the intangibles without recognition conditions, especially goodwill, their specificities, the reigning controversy among researchers regarding its accounting, emphasizing, in this light, the need for tests of impairment. In this realm, this paper focuses on analyzing the controversy of the determination of the discount rate, study the concept of fair value and observe the relationship between accounting and business valuation techniques. Finally, this work sheds light on the importance of adopting these standards by countries like Portugal and Brazil in order to ensure financial information with high relevance and reliability, after all information disclosed by companies help users of the consolidated financial statements to assess the nature, risks and financial effects associated with business combinations and goodwill, these aspects of importance to decision making.