{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/350/20/#40-derecognition","source":"FASB Accounting Standards Codification, Basic View","usage":"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.","topic":"350","topic_title":"Intangibles—Goodwill and Other","subtopic":"350-20","subtopic_title":"Goodwill","section":{"number":"40","label":"40 Derecognition","anchor":"40-derecognition","is_sec":false,"groups":[{"block":null,"heading":"Disposal of All or a Portion of a Reporting Unit","paragraphs":[{"citation":"350-20-40-1","para":"40-1","html":"
When a reporting unit is to be disposed of in its entirety, goodwill of that reporting unit shall be included in the carrying amount of the reporting unit in determining the gain or loss on disposal.
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When a portion of a reporting unit that constitutes a business (see Section 805-10-55) or nonprofit activityis to be disposed of, goodwill associated with that business or nonprofit activity shall be included in the carrying amount of the business or nonprofit activity in determining the gain or loss on disposal.
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The amount of goodwill to be included in that carrying amount shall be based on the relative fair values of the business or nonprofit activity to be disposed of and the portion of the reporting unit that will be retained. For example, if a reporting unit with a fair value of $400 is selling a business or nonprofit activity for $100 and the fair value of the reporting unit excluding the business or nonprofit activity being sold is $300, 25 percent of the goodwill residing in the reporting unit would be included in the carrying amount of the business or nonprofit activity to be sold.
","snippet":"The amount of goodwill to be included in that carrying amount shall be based on the relative fair values of the business or nonprofit activity to be disposed of and the portion of the reporting unit that will be retained…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:465305fd35513e01a02cde048c0d93490332dc86610e89b09df1d7789d9d9994","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}},{"citation":"350-20-40-4","para":"40-4","html":"
However, if the business or nonprofit activity to be disposed of was never integrated into the reporting unit after its acquisition and thus the benefits of the acquired goodwill were never realized by the rest of the reporting unit, the current carrying amount of that acquired goodwill shall be included in the carrying amount of the business or nonprofit activity to be disposed of.
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That situation might occur when the acquired business or nonprofit activity is operated as a standalone entity or when the business or nonprofit activity is to be disposed of shortly after it is acquired.
","snippet":"That situation might occur when the acquired business or nonprofit activity is operated as a standalone entity or when the business or nonprofit activity is to be disposed of shortly after it is acquired.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:073ff5d28997bb2756a86980b01900009a27165a3eabde27e5f5c524b8c0c4c5","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}},{"citation":"350-20-40-6","para":"40-6","html":"
Situations in which the acquired business or nonprofit activity is operated as a standalone entity are expected to be infrequent because some amount of integration generally occurs after an acquisition.
","snippet":"Situations in which the acquired business or nonprofit activity is operated as a standalone entity are expected to be infrequent because some amount of integration generally occurs after an acquisition.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:05766c6ae5286d019d6f061a3efe701bc71a240d610fc5ccab585af7be25a4f1","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}},{"citation":"350-20-40-7","para":"40-7","html":"
When only a portion of goodwill is allocated to a business or nonprofit activity to be disposed of, the goodwill remaining in the portion of the reporting unit to be retained shall be tested for impairment in accordance with paragraphs
350-20-35-3A through 35-13
using its adjusted carrying amount.
","snippet":"When only a portion of goodwill is allocated to a business or nonprofit activity to be disposed of, the goodwill remaining in the portion of the reporting unit to be retained shall be tested for impairment in accordance …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:93dacb57e129c1a59d614d49f61dbe7a37888328be48d1b012b05d02e084457b","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c901fb79dc4c20b19d0da5b37469da911be8ca309bf32235ef2871562e01766e","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}},{"block":"Accounting Alternatives","heading":null,"paragraphs":[{"citation":"350-20-40-8","para":"40-8","html":"
The following guidance for goodwill applies to entities within the scope of paragraph 350-20-15-4 that elect the accounting alternative for amortizing goodwill.
","snippet":"The following guidance for goodwill applies to entities within the scope of paragraph 350-20-15-4 that elect the accounting alternative for amortizing goodwill.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d0840a4b6301c755e6148857d8a30460f034db8992f5dec3aaf77e82a4b65228","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8c04367e7c3015cf801fd06ce5851f6808dce4d3aa07aa4998757ea732d74f4a","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}},{"block":"Accounting Alternatives","heading":"Disposal of a Portion of an Entity (or a Reporting Unit)","paragraphs":[{"citation":"350-20-40-9","para":"40-9","html":"
When a portion of an entity (or a reporting unit) that constitutes a business or nonprofit activity is to be disposed of, goodwill associated with that business or nonprofit activity shall be included in the carrying amount of the business or nonprofit activity in determining the gain or loss on disposal. An entity shall use a reasonable and rational approach to determine the amount of goodwill associated with the business or nonprofit activity to be disposed of.
","snippet":"When a portion of an entity (or a reporting unit) that constitutes a business or nonprofit activity is to be disposed of, goodwill associated with that business or nonprofit activity shall be included in the carrying amo…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bdece50677911f9edc472b78178051692ef25ed838ec93eb107f476580fd99c4","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cf6f800bdfede291e61f781dd970d4a7d601b661a20b45088ee8ecec2ae6b5c8","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d4ad681847b9dff5beb34070cd2a9ff3d0360ac76e74358efe64ba0773e0e08c","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d4ad681847b9dff5beb34070cd2a9ff3d0360ac76e74358efe64ba0773e0e08c","downloaded_from":"2026-09-10T00:00:57.352Z","last_downloaded_at":"2026-09-10T00:00:57.352Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482622","source_sha256":"cec87eb93bf712273ba065be01d53e9d69a6b071b59163802737a9f84a20806c"}}