Goodwill Impairment and Valuation Risk in Business Combinations
First written in FY2018. 5 of 16 entries say "Worsened", first in FY2021-Q1. Latest entry: FY2026.
Denso moved to the "Worse" side of this theme in 2018, 6 years before the typical company in this theme (2024).
The whole theme swung hardest in 2023: 35 of 97 companies on the "Worse" side.
32 other companies' latest entry also says "Mitigated".
- FY2026MitigatedAnnual report
「The purchase price allocation was completed during the current consolidated fiscal year.」
The purchase price allocation for Axia Group B.V. was completed, and provisional goodwill was revised from ¥59,378 million to ¥38,134 million. Although uncertainty in the valuation at the time of the business combination has diminished, the goodwill balance is ¥41,465 million. - FY2026-H1WorsenedAnnual report
「Because the purchase price allocation has not been completed, the fair values of assets and liabilities are provisional amounts recognized as of the acquisition date. Accordingly, during the measurement period (one year from the acquisition date), the company plans to identify intangible assets and other items and perform the purchase price allocation based on facts and information that existed as of the acquisition date.」
In connection with making Axia Group B.V. a wholly owned subsidiary, provisional goodwill of ¥593,778 million was recognized, and the possibility of revisions arising from the identification of intangible assets and other items and the purchase price allocation during the one-year measurement period from the acquisition date was disclosed. - FY2025RestatedAnnual report
「The recoverable amount exceeded the carrying amount during the current consolidated fiscal year, but an impairment loss would arise if the discount rate increased by 0.7%.」
In goodwill impairment testing, the recoverable amount continues to exceed the carrying amount, but impairment sensitivity to a 0.7% increase in the discount rate continues to be disclosed. - FY2024MitigatedAnnual report
「The purchase price allocation was completed during the three-month period ended 31 March 2024. As a result, goodwill decreased by ¥7,569 million.」
The purchase price allocation for Belua Beheer B.V. was completed, reducing provisional goodwill from ¥17,464 million to ¥9,895 million. Uncertainty in the acquisition valuation has diminished. - FY2024-Q3RestatedAnnual report
「Because the purchase price allocation has not been completed, the fair values of assets and liabilities are provisional amounts recognized as of the acquisition date and may be revised during the measurement period (one year from the acquisition date).」
The company continues to disclose goodwill of ¥17,464 million arising from making Belua Beheer B.V. a wholly owned subsidiary, as well as the possibility that the fair values and goodwill may be revised during the one-year measurement period from the acquisition date. - FY2024-Q2WorsenedAnnual report
「Goodwill (Note) (A−B) ¥17,464 million. Because the purchase price allocation has not been completed, the fair values of assets and liabilities are provisional amounts recognized as of the acquisition date and may be revised during the measurement period (one year from the acquisition date).」
In connection with making Belua Beheer B.V. a wholly owned subsidiary, provisional goodwill of ¥17,464 million was recognized. The purchase price allocation remains incomplete, and the fair values and goodwill may be revised during the one-year measurement period from the acquisition date. - FY2023WorsenedAnnual report
「For TD Mobile, a goodwill impairment loss of ¥1,188 million was recognized in connection with fair value measurement.」
TD Mobile's goodwill impairment loss increased from ¥42 million in the previous fiscal year to ¥1,188 million, indicating heightened valuation and impairment risk associated with the business combination. - FY2022MaterialisedAnnual report
「For TD Mobile, a goodwill impairment loss of ¥42 million was recognized due to declining profits at company-operated stores and their disposal, among other factors. Although the recoverable amount exceeded the carrying amount during the current consolidated fiscal year, an impairment loss would arise if the discount rate increased by 3.6%.」
A goodwill impairment loss of ¥42 million was recognized for TD Mobile, and impairment sensitivity to a 3.6% increase in the discount rate was also disclosed for the company, デンソーテン and other businesses. - FY2022-Q3MitigatedAnnual report
「The purchase price allocation was completed during the three-month period ended 31 December 2021. As a result, non-controlling interests increased by ¥3,496 million and goodwill decreased by ¥3,577 million.」
The purchase price allocation for Chongqing Chaoli Electrical Appliances was completed, reducing uncertainty in the valuation of the provisional fair values and goodwill. - FY2022-Q2MitigatedAnnual report
「The purchase price allocation was completed during the three-month period ended 30 September 2021. As a result, negative goodwill increased by ¥44 million.」
The purchase price allocation for ジェコー株式会社 was completed, reducing uncertainty in the valuation of the provisional fair values. - FY2022-Q1WorsenedAnnual report
「Because the purchase price allocation, including property, plant and equipment, has not been completed, the fair values of non-current assets are provisional amounts recognized as of the acquisition date and may be revised during the measurement period (one year from the acquisition date). The negative goodwill of ¥8,223 million arising from this share exchange resulted from the fair value of the acquired net assets exceeding the purchase price.」
In connection with making ジェコー株式会社 a consolidated subsidiary, the purchase price allocation and fair values of non-current assets were provisionally recognized, and the possibility of revisions during the one-year period from the acquisition date was newly disclosed. - FY2021-Q2MitigatedAnnual report
「The purchase price allocation was completed during the three-month period ended 30 September 2020. As a result, goodwill decreased by ¥47,076 million.」
The purchase price allocation for the major electronic components business acquired from Toyota was completed, reducing provisional goodwill from ¥54,341 million to ¥7,265 million. Valuation uncertainty has diminished. - FY2021-Q1WorsenedAnnual report
「Goodwill (Note) (A−B) ¥54,341 million. Because the purchase price allocation, including intangible assets, has not been completed, the fair values of non-current assets are provisional amounts recognized as of the acquisition date and may be significantly revised during the measurement period (one year from the acquisition date).」
Goodwill of ¥54,341 million was recognized in connection with the acquisition of the major electronic components business from TOYOTA MOTOR CORPORATION. Because the purchase price allocation and fair values are provisional and may be significantly revised during the one-year measurement period from the acquisition date, the scope of valuation and impairment risk has expanded. - FY2020RestatedAnnual report
「For TD Mobile, a goodwill impairment loss of ¥243 million was recognized due to declining profits at company-operated stores and their disposal, among other factors.」
A goodwill impairment loss of ¥243 million was also recognized for TD Mobile in the current fiscal year. - FY2019MaterialisedAnnual report
「For TD Mobile, the company recorded a goodwill impairment loss of ¥334 million due to lower profits at company-operated stores and their disposal, among other factors.」
TD Mobile recorded a goodwill impairment loss of ¥334 million again in the current fiscal year. The company also disclosed impairment sensitivity for the DENSO TEN Group and other entities, under which an impairment loss would arise if the discount rate increased by 1.3%. - FY2018MaterialisedAnnual report
「For TD Mobile, the company recorded a goodwill impairment loss of ¥393 million due to lower profits at company-operated stores and their disposal, among other factors.” “For the DENSO TEN Group, recoverable amount exceeded carrying amount in the consolidated fiscal year under review, but an impairment loss would arise if the discount rate increased by 1.4%.」
TD Mobile actually incurred a goodwill impairment loss of ¥393 million, and the company also disclosed impairment sensitivity for the DENSO TEN Group assuming a 1.4% increase in the discount rate.