goodwill

Consolidation (EC-CS)

Goodwill is a differential that arises during the consolidation of investments; it is recorded as an intangible asset and is amortized over its remaining life, the length of which is determined either by legal statutes or internally.

During first consolidation, goodwill is calculated as the difference between the group's share in the investors' investment book values and the group's share in the stockholders' equity of the investee units being consolidated, while taking hidden reserves (fair value adjustments) into account.

Possible reasons for goodwill are

Consolidation (FI-LC)

Goodwill is a differential amount on the assets side and arises during the consolidation of investments. It is recorded as an intangible asset and amortized over a predetermined, by law or internally, estimated remaining life.

During first consolidation, goodwill is calculated as the difference between the group share-related investment book values of the direct parent companies and the group share-related equity of the company being consolidated, while taking hidden reserves (fair value adjustments) into account.

Possible reasons for goodwill are an earning capacity value that deviates from the net asset value of the acquired company as well as additional benefits (transfer of know-how, customer contacts, elimination of competitors, etc.) from the acquiring company's point of view.