Should Goodwill Be Amortised? Empirical Evidence from UAE
Accounting for goodwill is one of the most controversial issues in financial reporting. This study provides empirical evidence on whether goodwill amortization requirement in inappropriate. It analyses the information content of goodwill amortization in the determination of firm's market valuation by Emirates Financial Market Listed companies that clearly reported goodwill amortization over period 1990 to 2002 inclusive. Evidence suggests that there is a statistically insignificant association between equity market values and goodwill amortization in the determination of firms' market valuation, concluding that the UAE market does not perceive goodwill amortization as having information content when valuing firms and the use of standardized amortization requirement may be inappropriate.

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