Write-downs

As markets have deteriorated, write-downs have figured prominently in more and more corporate reports. What are write-downs all about? Marketplace Senior Editor Paddy Hirsch explains.

Category:

Education

Tags:

• Marketplace
• business
• money
• quantitativeeasing
• financialCrisis
• creditCrisis
• PaddyHirsch

[koeppe25]

I'm amazed these vids are not more popular. This guy rocks!

[iiiiiieeeeee]

You're doing what governments and public service broadcasters are failing to do!

[diabloreventonf22]

love it when he says "needing a drink" and throws the pen

[tbscrazy12]

Its called impairment. Under GAAP once the goodwill is impaired a company cannot recover the impairment loss. Under IFRS you can recover the impairment loss. BTW goodwill can never be internally created.

[FA9082]

Now I need a drink!

[fukinh0t]

Market value is the price at which is selling at that time. So if it was sold at 1.5 million then that should be the market price. Goodwill should only be recorded when you buy an operating company and measures intangible assets like employess(numan capital), that can't be measured. If he is just buying the building, all cost associated with getting the building to its intended use should be included in the building account on the books.

[Somuchclass]

From what I read in my accounting textbook, when you buy asset/s you record them at market value, anything extra is goodwill. So in the example he would have 2 assets: the building 2 mill and goodwill 0.5 mill. If you writedown goodwill you lower the account goodwill.

[morgandrim]

About 1/3 the way through this vid. I thought to myself, is it me, or what about "Writeups ?"

Thank God the fella mentioned them. I thought I was perhaps too dim for all this stuff.

[BabyBacon]

Remember that goodwill is only a estimated value, that means that even if the store is going up 500k at the end of the year. The estimated earnings for the future may be a lot lower. Lets say 250k. Thats mean its been written down 250k even thou you are up 500k as you estimated.

[fatalegg]

thanks. i like the end "needing a drink" throws pen haha

[Blackasknight]

Another great video.BTW (and correct me if im wrong) but goodwill is neither added or subtracted from the balance sheet total of the store. Goodwill is a separate account under assets...basically serving one purpose, and that is to provide for a place to record the extra $500,000 that can not be recorded with the value of the store.

[johnyada]

Great Videos. What is your take on gold silver?