CERTYNEX IFRS ACADEMY

Why may the initial allocation of goodwill not be completed at the end of the annual period in which the business combination took place?

Because goodwill is never tested for impairment in the year of acquisition, so its allocation can wait.

Because management may freely choose whatever allocation date suits it, regardless of the acquisition date.

Because goodwill is recognised only at the end of the measurement period, and not before.

Because the initial accounting for the combination may be only provisional at the reporting date, under IFRS 3.