Not-for-Profit Groups to Get Break on Accounting for Goodwill

A not-for-profit hospital buying a for-profit physician practice will soon be able to use a simpler accounting method for the intangible asset called goodwill, U.S. accounting rulemakers have decided.

The Financial Accounting Standards Board April 10 unanimously confirmed a proposal that will allow not-for-profit groups to amortize, or spread out, for up to 10 years the goodwill that arises in some acquisitions. This move extends to these groups an accounting break that until now applied only to privately held businesses. The update will be published by mid-year, a FASB spokesperson said.

Businesses and organizations record goodwill on their balance sheets ...