# ASC 350-20-05: Intangibles—Goodwill and Other — Goodwill — 05 Overview and Background Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/350/20/#05-overview-and-background) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-10T00:00:43.503Z to 2026-09-10T00:00:43.503Z Record version: sha256:809492275a3e42e646b83bec24433534571dffe819cb38276f3de553f068dc78 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 350-20-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/350/20/#05-overview-and-background) SEC content: no ##### [350-20-05-1](https://asc.understandingaccounting.org/asc/350/20/#350-20-05-1) Pending content: no Source downloaded (UTC): 2026-09-10T00:00:43.503Z to 2026-09-10T00:00:43.503Z Record version: sha256:ccabf1b89c315c3a1bb1c01cafca0dee0181ea155fb9266f9d896e502cb9d996 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic addresses financial accounting and reporting for [goodwill](https://asc.understandingaccounting.org/glossary/g/#goodwill "An asset representing the future economic benefits arising from other assets acquired in a business combination, acquired in an acquisition by a not-for-profit entity, or recognized by a joint venture upon formation that are not individually identified and separately recognized. For ease of reference, this term also includes the immediate charge recognized by not-for-profit entities in accordance with paragraph 958-805-25-29.") subsequent to its acquisition and for the cost of internally developing goodwill. ##### [350-20-05-2](https://asc.understandingaccounting.org/asc/350/20/#350-20-05-2) Pending content: no Source downloaded (UTC): 2026-09-10T00:00:43.503Z to 2026-09-10T00:00:43.503Z Record version: sha256:0e8422f5cc6219c77fa5ee818608dfb290447456df4dca0f0649889faa33ace7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Subtopic 805-30 provides guidance on recognition and initial measurement of goodwill acquired in a business combination. Subtopic 958-805 provides guidance on recognition and initial measurement of goodwill acquired in an [acquisition by a not-for-profit entity](https://asc.understandingaccounting.org/glossary/a/#acquisition-by-a-not-for-profit-entity "A transaction or other event in which a not-for-profit acquirer obtains control of one or more nonprofit activities or businesses and initially recognizes their assets and liabilities in the acquirer's financial statements. When applicable guidance in Topic 805 is applied by a not-for-profit entity, the term business combination has the same meaning as this term has for a for-profit entity. Likewise, a reference to business combinations in guidance that links to Topic 805 has the same meaning as a reference to acquisitions by not-for-profit entities."). Subtopic 805-60 provides guidance on the recognition and initial measurement of goodwill by a [joint venture](https://asc.understandingaccounting.org/glossary/j/#joint-venture "An entity owned and operated by a small group of businesses (the joint venturers) as a separate and specific business or project for the mutual benefit of the members of the group. A government may also be a member of the group. The purpose of a joint venture frequently is to share risks and rewards in developing a new market, product, or technology; to combine complementary technological knowledge; or to pool resources in developing production or other facilities. A joint venture also usually provides an arrangement under which each joint venturer may participate, directly or indirectly, in the overall management of the joint venture. Joint venturers thus have an interest or relationship other than as passive investors. An entity that is a subsidiary of one of the joint venturers is not a joint venture. The ownership of a joint venture seldom changes, and its equity interests usually are not traded publicly. A minority public ownership, however, does not preclude an entity from being a joint venture. As distinguished from a corporate joint venture, a joint venture is not limited to corporate entities.") upon formation. ##### [350-20-05-3](https://asc.understandingaccounting.org/asc/350/20/#350-20-05-3) Pending content: no Source downloaded (UTC): 2026-09-10T00:00:43.503Z to 2026-09-10T00:00:43.503Z Record version: sha256:27d79f01dffb9a5e88b55a008ca9f34a8b9996d4012006a86890998c9637db6e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2017-04](https://asc.understandingaccounting.org/updates/asu-2017-04/). ##### [350-20-05-4](https://asc.understandingaccounting.org/asc/350/20/#350-20-05-4) Pending content: no Source downloaded (UTC): 2026-09-10T00:00:43.503Z to 2026-09-10T00:00:43.503Z Record version: sha256:20a76b6b1bc0e69b313fe87bd584e421b99e0182721fd413a8d79bae1f230d46 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic is presented in the following two Subsections: 1. a General 2. b Accounting Alternatives. ##### [350-20-05-4A](https://asc.understandingaccounting.org/asc/350/20/#350-20-05-4A) Pending content: no Source downloaded (UTC): 2026-09-10T00:00:43.503Z to 2026-09-10T00:00:43.503Z Record version: sha256:cae301dd9b02d412a1ddd148949c8becb05c911ad1fe7aedd734e462bd756b41 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Costs of developing, maintaining, or restoring internally generated goodwill should not be capitalized. For entities that do not elect the accounting alternative for amortizing goodwill included in the guidance in the Subsections outlined in paragraph [350-20-05-5A](https://asc.understandingaccounting.org/asc/350/20/#350-20-05-5A), goodwill that is recognized under the business combination guidance in Topic 805 and Subtopic 958-805 and goodwill that is recognized under the joint venture formation guidance in Subtopic 805-60should not be amortized. Instead, it should be tested for impairment at least annually in accordance with paragraphs [350-20-35-28 through 35-32](https://asc.understandingaccounting.org/asc/350/20/#350-20-35-28) .If the accounting alternative for a goodwill impairment triggering event evaluation is elected, a goodwill impairment triggering event shall be evaluated in accordance with paragraphs [350-20-35-83 through 35-86](https://asc.understandingaccounting.org/asc/350/20/#350-20-35-83) . ##### [350-20-05-4B](https://asc.understandingaccounting.org/asc/350/20/#350-20-05-4B) Pending content: no Source downloaded (UTC): 2026-09-10T00:00:43.503Z to 2026-09-10T00:00:43.503Z Record version: sha256:882d5742cb413f23ba014638c32db6d68ff8c9e3a3a77cad4e2af2354e09003f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic also includes guidance on the following: 1. a How an entity should derecognize goodwill when it disposes of all or a portion of a reporting unit 2. b How goodwill should be presented in the balance sheet 3. c How impairment losses should be presented in the income statement 4. d What disclosures about goodwill and related impairment considerations should be made in the notes to the financial statements. ### Accounting Alternatives ##### [350-20-05-5](https://asc.understandingaccounting.org/asc/350/20/#350-20-05-5) Pending content: no Source downloaded (UTC): 2026-09-10T00:00:43.503Z to 2026-09-10T00:00:43.503Z Record version: sha256:2136ee122c5f8c15a95440647e41f371b5b9154152f44b22d3e19d16f0713227 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Accounting Alternatives Subsections of this Subtopic provide guidance for the following: 1. a An entity within the scope of paragraph [350-20-15-4](https://asc.understandingaccounting.org/asc/350/20/#350-20-15-4) that elects the accounting alternative for amortizing goodwill. If elected, this accounting alternative allows an eligible entity to amortize goodwill and test that goodwill for impairment upon a triggering event. 2. b An entity within the scope of paragraph [350-20-15-4A](https://asc.understandingaccounting.org/asc/350/20/#350-20-15-4A) that elects the accounting alternative for a goodwill impairment triggering event evaluation. If elected, this accounting alternative allows an eligible entity to evaluate goodwill impairment triggering events only as of the end of each reporting period. ##### [350-20-05-5A](https://asc.understandingaccounting.org/asc/350/20/#350-20-05-5A) Pending content: no Source downloaded (UTC): 2026-09-10T00:00:43.503Z to 2026-09-10T00:00:43.503Z Record version: sha256:919303b05d7c2a216d783b2d98fd4c119c45fc323270488ccd3dd66483838bab Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The accounting alternatives guidance can be found in the following paragraphs: 1. a Scope and Scope Exceptions—paragraphs [350-20-15-4 through 15-6](https://asc.understandingaccounting.org/asc/350/20/#350-20-15-4) 2. b Subsequent Measurement—paragraphs [350-20-35-62 through 35-86](https://asc.understandingaccounting.org/asc/350/20/#350-20-35-62) 3. c Derecognition—paragraphs [350-20-40-8 through 40-9](https://asc.understandingaccounting.org/asc/350/20/#350-20-40-8) 4. d Other Presentation Matters—paragraphs [350-20-45-4 through 45-7](https://asc.understandingaccounting.org/asc/350/20/#350-20-45-4) 5. e Disclosure—paragraphs [350-20-50-3A through 50-7](https://asc.understandingaccounting.org/asc/350/20/#350-20-50-3A) 6. f Implementation Guidance and Illustrations—paragraphs [350-20-55-26 through 55-29](https://asc.understandingaccounting.org/asc/350/20/#350-20-55-26) . ##### [350-20-05-6](https://asc.understandingaccounting.org/asc/350/20/#350-20-05-6) Pending content: no Source downloaded (UTC): 2026-09-10T00:00:43.503Z to 2026-09-10T00:00:43.503Z Record version: sha256:6a8017fcec9a9d73e1bb83c09ffe360be8c02d6d49e8f2a38940622b7e6dc9de Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An entity should continue to follow the applicable requirements in Topic 350 for other accounting and reporting matters related to goodwill that are not addressed in the Accounting Alternatives Subsections of this Subtopic.