Section Article

Australia’s Adherence to IFRS Requirements for Goodwill Impairment Testing: An Evidence-Based Examination
Author(s): Aniruddha Acharya

Abstract
Goodwill impairment testing has become one of the most complex debated and extensively scrutinized areas in international financial reporting. Under the IFRS framework specifically IAS 36 Impairment of Assets and IFRS 3 Business Combinations entities are required to perform annual impairment testing of goodwill and disclose robust decision-useful information related to assumptions methodologies cash-generating units discount rates value-in-use calculations and sensitivity analyses. As Australia fully adopted IFRS in 2005 Australian listed companies have since been required to rigorously comply with these standards. This research paper examines Australia’s practical adherence to IFRS disclosure requirements for goodwill impairment testing drawing upon evidence from financial reports academic studies enforcement reviews by the Australian Securities and Investments Commission (ASIC) and internationally benchmarked IFRS compliance studies conducted between 2015 and 2020.