This paper uses a transactions theory approach to analyse some of the measurement and disclosure issues involved in accounting for goodwill and other intangibles. The recent professional and academic literature is reviewed and the traditional economic theory approach to interpreting accounting issues in these areas is criticised. A form of transactions theory called ‘Statistical Transactions Theory’ is then used to investigate several conceptual problem areas, notably: the definition of goodwill and fair values; the distinction between goodwill and other intangibles; and capitalisation, amortisation and valuation issues. The authors conclude that the most fruitful course of action in dealing with these issues would be a substantial research effort designed to investigate the distributional properties of accounting numbers relating to the subject of intangibles measurement, including goodwill as defined in this paper. They call for more analytic and empirical work in this field.

Item Type:	Refereed Article
Research Division:	Commerce, Management, Tourism and Services
Research Group:	Accounting, Auditing and Accountability
Research Field:	Accounting Theory and Standards
Objective Division:	Economic Framework
Objective Group:	Measurement Standards and Calibration Services
Objective Field:	Service Industries Standards and Calibrations
Author:	Willett, RJ (Professor Roger Willett)
ID Code:	100578
Year Published:	1993
Deposited By:	Tasmanian School of Business and Economics
Deposited On:	2015-05-20
Last Modified:	2015-06-09
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