Goodwill Alternative and Other Accounting Updates

Financial Institutions

March 01, 2014
by Brett Schwantes, CPA

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Brett Schwantes Brett Schwantes, CPA
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In January 2014, the Financial Accounting Standards Board (FASB) issued three new Accounting Standards Updates (ASUs). ASU No. 2014-02, Accounting for Goodwill, is applicable for all financial institutions except those considered public business entities. This standard allows entities to elect an accounting alternative to amortize goodwill on a straight-line basis over ten years, or less than ten years if the entity demonstrates another useful life is more appropriate. Institutions may elect the alternative as of the beginning of any interim or annual period for which financial statements have not been issued. Once this election is made, all future goodwill must also be accounted for following this alternative.

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