why it will survive, page-27

Ahhh, but you're only half right, jimmythehand5.

Yes, it is not acceptable to recognise brand new goodwill on the balance sheet. (AASB 168)

But the impairment of existing goodwill is still 'cushioned' by internally-generated goodwill. And that is how it is the world-over as everyone adopts IASB standards.

How is this possible? Simple. Goodwill is initially calculated as the residual between Net Fair Value of Identifiable Assets and the Cost of Combination.

Every year the Cash Generating Unit is impairment tested. If both the Value in Use and the Recoverable Value have fallen below Cost of Combination, then Goodwill is the first account to be impaired. However, if this hasn't happened, then Goodwill has essentially been 'cushioned' by internally-generated goodwill.

Value in Use is a bit of a judgement call (discounted cash flows), so it's easy to cook things so that there is always internally-generated goodwill.

Thus endeth the lesson from AASB 136.

This is just one reason 'Fair Value' accounting standards are a joke. Historic Cost or bust, I say!