Goodwill impairment refers to a decrease in the value of a company's "goodwill" asset. Goodwill represents the premium a company pays when acquiring another company above its tangible assets' worth. If the value of the acquired company's goodwill decreases, it means it is worth less than what was initially paid for it. This could happen due to reasons like economic downturns, declining business performance, or changes in market conditions.
Goodwill impairment is important for companies as it affects their financial statements and can result in lower profits or losses.
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