Better Late than Never, the Timing of Goodwill Impairment Testing in Australia

The International Financial Reporting Standards (IFRS) goodwill impairment testing regime has been in place in Australia for almost a decade. One of the burning issues arising from the adoption of the IFRS regime is whether firms have impaired goodwill in a timely manner. This study examines the timing of goodwill impairment decisions in the Australian context during the period 2007 to 2009. It is evident that a non‐trivial number of firms did not impair goodwill as called for under the standard governing asset impairment.