Goodwill Accounting Heads for Change But Test Level to Stay Put

Even though U.S. rulemakers are advancing a major shakeup to goodwill accounting, one thing is likely to stay the same: the level within a company at which accountants test goodwill balances for dips in value.

A split Financial Accounting Standards Board on Wednesday agreed to keep the much-maligned goodwill impairment test at what’s called the reporting unit—an accounting term that describes a company’s operating segment or one level below it. It’s a component of a business that engages in business activities, has its operating results, and for which discrete financial information is available, according to FASB.

Three of FASB’s ...