RISS 검색 - 국내학술지논문 상세보기

다국어 초록 (Multilingual Abstract)

This study focuses on the title of Goodwill Amortization and Impairment, with the objective of examining the validity of changes in accounting standards. Long- standing debates on goodwill have continued and accounting standards on goodwill have been drastically revised in the United States and International Accounting Standards. These standards reflect a changing economic and social environment. Recently, Korean accounting standards revision on goodwill also reflect those changes on the basis of International Accounting Standards. The objective of this study is to examine the validity of changes in accounting for goodwill by analyzing relative explanatory powers of accounting information based on current and new accounting standards (exposure draft). For the objective given, the study focuses can be classified as follows: The first focus is to compare explanatory powers of market price between current accounting standards and the exposure draft. Based on current accounting standards, Model Ⅰ recognizes goodwill amortization, and also goodwill impairment. This impairment rule is comprehensive and discretionary as are tangible and intangible assets. Based on the exposure draft, Model Ⅱ does not recognize goodwill amortization, but recognizes goodwill impairment. In goodwill impairment, however, the exposure draft is a more specific standard than the previous standards and has reduced managerial discretion. This model is based on Statements of Financial Accounting Standards and International Accounting Standards. The second focus is to analyze the explanatory power of goodwill impairment, and motivation and the causes of goodwill impairment. Three different models can be drawn from the study. Based on current accounting standards, Model Ⅲ recognizes goodwill amortization and also recognizes goodwill impairment. Model Ⅳ, the comparative model of model Ⅲ, recognizes goodwill amortization, but does not recognize goodwill impairment. Model Ⅴ analyzes characteristics of goodwill impairment. Therefore, this study tried to examine the validity of those accounting changes in goodwill by examining and comparing the explanatory power of stock prices between current and new accounting standards through Ohlson(1995) model. The research period was 5 years from 1999 to 2003 and final samples to be examined comprised 659 firm-years that reported goodwill, goodwill amortization and goodwill impairment during the sample period. Empirical models for Model Ⅰ and Ⅱ are as follows: In Model Ⅰ, the dependent variable is the market price. The independent variables are abnormal earnings per share and the book value per share. Control variables are the year dummy variable and the market dummy variable. In Model Ⅱ, the dependent variable is the market price. The independent variables are abnormal earnings per share plus goodwill amortization per share, the book value per share plus accumulated goodwill amortization per share. Control variables are the year dummy variable and the market dummy variable. Empirical models for Model Ⅲ and Ⅳ are as follows: In Model Ⅲ, the dependent variable is the market price. The independent variables are abnormal earnings per share and the book value per share. Control variables are the year dummy variable and the market dummy variable. In Model Ⅳ, the dependent variable is the market price. The independent variables are abnormal earnings per share plus goodwill impairment per share, the book value per share plus accumulated goodwill impairment per share. Control variables are the year dummy variable and the market dummy variable. Empirical model for Model Ⅴ is as follows: In Model Ⅴ, dependent variable is the goodwill impairment. The independent variables are the change in sales, change in market value, management exchange, debt/asset ratio, positive unexpected earnings, and negative unexpected earnings. The change in sales and change in market value reflect economic factors. The others reflect managerial factors. Control variables are size, the year dummy variable, and the market dummy variable. The results for relative analysis between current accounting standards and the exposure draft are as follows: As a whole from the samples, significant differences are not found where there is a relatively low proportion of goodwill and low amortization amount. However, for the samples that have a relatively higher proportion of goodwill amortization, significant differences are found. Based on the exposure draft, the explanatory power (adjusted R) of Model Ⅱ is significantly higher than that of Model Ⅰ under current accounting standards. The results for relative analysis of the explanatory power for goodwill impairment are as follows: As in the results from the analysis on goodwill amortization, significant differences are not found with a low proportion of goodwill impairment amount. The results for analysis of characteristics of goodwill impairment loss are as follows: The results are significant for the variables from change in sales, debt/asset ratio, positive unexpected earnings, and negative unexpected earnings. The main empirical results of this study are as follows; Significant differences in the explanatory power of stock prices based on goodwill accounting changes are not found between current and new accounting standards, which may be explained partially by a small portion of goodwill and goodwill amortization, and goodwill impairment. However, firms whose relative amount of goodwill amortization in comparison with operating income is larger show a significantly higher explanatory power of stock prices in new accounting standards than current accounting standards in Korea. Therefore, the new accounting standards revision may have validity. This study examined the explanatory power of stock prices by goodwill impairment. No evidence of significant incremental explanatory power was found. An analysis on related factors and characteristics that may have influence on goodwill impairment was also conducted. It was found that firms that report goodwill impairment consider economic factors and managerial behavioral factors concurrently. The empirical findings support the theory that mangers are more likely to make decisions of recognizing goodwill impairment loss based on managerial reporting incentives rather than economic consideration.

참고문헌 (Reference)

1 Strong, "” The Journal of Finance 42" Managerial Incentives and Security Returns 1987

2 Duvall, "“Can Investors Unravel the Effects of Goodwill Accounting?" 1992

3 Feltham, G. A, "Valuation and Clean Surplus Accounting for Operating and Financial Activities" 689-731, 1995Spring

4 Amir, E, "The Valuation of Deferred Taxes" 597-622, 1997Winter

5 Jeon, Kyu-An, "The Influence of Listed Period on the Stock Price of KOSDAQ Firms" Printed in Korean 25 (25): 169-194, 2003

6 Financial Accounting Standards Board, "Statement of Financial Accounting Standards No.142: Goodwill and Other Intangible Assets" Stamford, CT 2001b

7 Financial Accounting Standards Board, "Statement of Financial Accounting Standards No.141: Business Combinations" Stamford, CT 2001a

8 McCarthy, M, "SFAS 141 and 142: Relavance to Prior and Future Mergers and Acquisitions in the Oil, Gas, and Energy Industry" 53-62, 2002Fall

9 International Accounting Standards Board, "Revised International Accounting Standard 38: Intangible Assets" London 2004c

10 International Accounting Standards Board, "Revised International Accounting Standard 36: Impairment Assets" London 2004b