ABSTRACT
Australian accounting standard ASRB 1013 Accounting for Goodwill was issued in 1988 and applied to financial years ending after 18 June that year. It required purchased goodwill to be capitalised at acquisition (clause .34) and then “systematically amortised” over not more than twenty years (clause .35) in a manner that “reflect(s) the amount and timing of expected future benefits” (clause .37). ASRB 1013 was replaced by the current standard, AASB 1013. Clause .35 of AASB 1013 says that goodwill “shall be systematically amortised … over the period of time during which the benefits are expected to arise” up to a twenty-year maximum. Paragraph (xiv) of the commentary to AASB 1013 states that “the amount and timing of the economic benefits expected to be derived” need to be considered when deciding which amortisation method to use and over how many years goodwill should be amortised.
