Using an institutional setting where GAAP is relatively unconstrained, we examine whether managers use their goodwill accounting discretion to reflect firms' growth options that are not otherwise captured in reported identifiable assets. We employ a continuous dependent variable to find that accounting discretion is exercised through estimates of goodwill's economic life (amortization period) in a manner that reflects the firms' underlying growth options. These results are consistent with managers using accounting techniques to reflect firms' investment opportunity sets (IOS). We find that the goodwill accounting decision has a stronger association with IOS variables than with traditionally applied contracting variables. Also, the IOS variables make a greater marginal contribution to the explanatory power of models of goodwill amortization periods than do traditional contracting or opportunism variables.

This paper examines how managers allocate the cost of firms' investments in subsidiaries between net tangible assets and acquired goodwill. We find a negative relation between acquired goodwill and leverage, and this could be interpreted as the result of managers of acquiring firms opportunistically allocating a lower portion of the acquisition price to acquired goodwill. However, this analysis, like much of the research on accounting choice, suffers from an omitted variables problem. We present evidence that the observed negative relation between acquired goodwill and leverage is likely to stem from each variable's relation to the acquiring firm's investment opportunity set. Further, we find that acquired goodwill is not related to the existence of debt covenants. Together, these results suggest an endogenous relation between the firm's asset structure, its financing policy, and acquired goodwill.

In 2001, goodwill amortization in the US was eliminated in favor of an impairment-only approach, which, according to critics, gives managers vast discretion and opportunities for earnings management. Prior research suggests that discretionary asset write-offs are associated with economic factors and managers_ financial reporting objectives. Based on a systematic literature review, this study investigates for a comprehensive sample of US firms the determinants of goodwill write-off behavior. Regression analysis shows that write-off behavior is significantly explained by firms_ economic properties. Only in large, high-profile firms, incentives appear to be significant determinants. These findings suggest that the impairment-only approach does capture goodwill impairment at least to some extent.

"Aswath Damodaran is simply the best valuation teacher around. If you are interested in the theory or practice of valuation, you should have Damodaran on Valuation on your bookshelf. You can bet that I do." -- Michael J. Mauboussin, Chief Investment Strategist, Legg Mason Capital Management and author of More Than You Know: Finding Financial Wisdom in Unconventional Places In order to be a successful CEO, corporate strategist, or analyst, understanding the valuation process is a necessity. The second edition of Damodaran on Valuation stands out as the most reliable book for answering many of today?s critical valuation questions. Completely revised and updated, this edition is the ideal book on valuation for CEOs and corporate strategists. You'll gain an understanding of the vitality of today?s valuation models and develop the acumen needed for the most complex and subtle valuation scenarios you will face.

The text and images in this book are in grayscale. A hardback color version is available. Search for ISBN 9781680922929. Principles of Accounting is designed to meet the scope and sequence requirements of a two-semester accounting course that covers the fundamentals of financial and managerial accounting. This book is specifically designed to appeal to both accounting and non-accounting majors, exposing students to the core concepts of accounting in familiar ways to build a strong foundation that can be applied across business fields. Each chapter opens with a relatable real-life scenario for today's college student. Thoughtfully designed examples are presented throughout each chapter, allowing students to build on emerging accounting knowledge. Concepts are further reinforced through applicable connections to more detailed business processes. Students are immersed in the "why" as well as the "how" aspects of accounting in order to reinforce concepts and promote comprehension over rote memorization.

"The presence, or absence, of neglected tropical diseases (NTDs) can be seen as a proxy for poverty and for the success of interventions aimed at reducing poverty. Today, coverage of the public-health interventions recommended by the World Health Organization (WHO) against NTDs may be interpreted as a proxy for universal health coverage and shared prosperity - in short, a proxy for coverage against neglect. As the world's focus shifts from development to sustainable development, from poverty eradication to shared prosperity, and from disease-specific goals to universal health coverage, control of NTDs will assume an important role towards the target of achieving universal health coverage, including individual financial risk protection. Success in overcoming NTDs is a "litmus test" for universal health coverage against NTDs in endemic countries. The first WHO report on NTDs (2010) set the scene by presenting the evidence for how these interventions had produced results. The second report (2013) assessed the progress made in deploying them and detailed the obstacles to their implementation. This third report analyses for the first time the investments needed to achieve the scale up of implementation required to achieve the targets of the WHO Roadmap on NTDs and universal coverage against NTDs. INVESTING TO OVERCOME THE GLOBAL IMPACT OF NEGLECTED TROPICAL DISEASES presents an investment strategy for NTDs and analyses the specific investment case for prevention, control, elimination and eradication of 12 of the 17 NTDs. Such an analysis is justified following the adoption by the Sixty-sixth World Health Assembly in 2013 of resolution WHA6612 on neglected tropical diseases, which called for sufficient and predictable funding to achieve the Roadmap's targets and sustain control efforts. The report cautions, however, that it is wise investment and not investment alone that will yield success. The report registers progress and challenges and signals those that lie ahead. Climate change is expected to increase the spread of several vector-borne NTDs, notably dengue, transmission of which is directly influenced by temperature, rainfall, relative humidity and climate variability primarily through their effects on the vector. Investments in vector-borne diseases will avoid the potentially catastrophic expenditures associated with their control. The presence of NTDs will thereby signal an early warning system for climate-sensitive diseases. The ultimate goal is to deliver enhanced and equitable interventions to the most marginalized populations in the context of a changing public-health and investment landscape to ensure that all peoples affected by NTDs have an opportunity to lead healthier and wealthier lives."--Publisher's description.