Pandemic Goodwill Writedowns Resonate in Rules Debate (1)

Shuttered malls, grounded planes, and global uncertainty from the coronavirus pandemic forced U.S. businesses in 2020 to slash the value of the goodwill on their balance sheets the most since the 2008 financial crisis.

It’s an estimated $145 billion writedown on company earnings, according to valuation firm Duff & Phelps. The markdowns on the value of intangible assets would have been a lot smaller, however, under a major shakeup U.S. accounting rulemakers are considering.

The Financial Accounting Standards Board is leaning toward allowing companies to amortize, or reduce in steady chunks over time, the value of their goodwill—the noncash asset ...