Document ID: chunk:federal_register_of_legislation:F2025C00207:front:0:p22
Version: federal_register_of_legislation:F2025C00207
Segment Type: other
Provision Reference: 
Character Range: 61180–64214

accordance with previous GAAP but would have been recognised separately under AASB 3, that asset or liability remains in goodwill unless Australian Accounting Standards would require its recognition in the financial statements of the acquiree.
(g) The carrying amount of goodwill in the opening Australian-Accounting-Standards statement of financial position shall be its carrying amount in accordance with previous GAAP at the date of transition to Australian Accounting Standards, after the following two adjustments:
(i) If required by (c)(i) above, the first-time adopter shall increase the carrying amount of goodwill when it reclassifies an item that it recognised as an intangible asset in accordance with previous GAAP. Similarly, if (f) above requires the first-time adopter to recognise an intangible asset that was subsumed in recognised goodwill in accordance with previous GAAP, the first-time adopter shall decrease the carrying amount of goodwill accordingly (and, if applicable, adjust deferred tax and non-controlling interests).
(ii) Regardless of whether there is any indication that the goodwill may be impaired, the first-time adopter shall apply AASB 136 in testing the goodwill for impairment at the date of transition to Australian Accounting Standards and in recognising any resulting impairment loss in retained earnings (or, if so required by AASB 136, in revaluation surplus). The impairment test shall be based on conditions at the date of transition to Australian Accounting Standards.
(h) No other adjustments shall be made to the carrying amount of goodwill at the date of transition to Australian Accounting Standards. For example, the first-time adopter shall not restate the carrying amount of goodwill:
(i) to exclude in-process research and development acquired in that business combination (unless the related intangible asset would qualify for recognition in accordance with AASB 138 in the statement of financial position of the acquiree);
(ii) to adjust previous amortisation of goodwill;
(iii) to reverse adjustments to goodwill that AASB 3 would not permit, but were made in accordance with previous GAAP because of adjustments to assets and liabilities between the date of the business combination and the date of transition to Australian Accounting Standards.
(i) If the first-time adopter recognised goodwill in accordance with previous GAAP as a deduction from equity:
(i) it shall not recognise that goodwill in its opening Australian-Accounting-Standards statement of financial position. Furthermore, it shall not reclassify that goodwill to profit or loss if it disposes of the subsidiary or if the investment in the subsidiary becomes impaired.
(ii) adjustments resulting from the subsequent resolution of a contingency affecting the purchase consideration shall be recognised in retained earnings.
(j) In accordance with its previous GAAP, the first-time adopter may not have consolidated a subsidiary acquired in a past business combination (for example, because the parent did not