the transaction closed in December 2015 with a goodwill component having an estimated cost of $87m. However the estimated cost is now several billion dollars, an astronomical difference.
It seem like there's something missing from this explanation.
Toshiba is facing such horrific cost-overruns with its US nuclear power plant projects it may have to sell assets, such as its flash memory business, to cover them. Its US subsidiary, Westinghouse Electric, is building four AP1000 power-generating reactors in the United States and costs are getting out of hand, with multi-year …
IANAA(ccountant); however, I read a book once. ``Goodwill'' is a way to account for the difference between the objective value of a company (buildings, equipment, contracted-for income, stuff that you can reasonably assign a value to) and what a buyer pays for it (covering reputation, the value of not having to start a business from scratch, employee knowledge and experience, whatnot).
Now comes the hand-waving: maybe Westinghouse thought CB&IS&W was worth a billion, of which some tens of millions was goodwill. Then, when it starts to shake out, they discover that the actual value is negative billions, and assign the difference to goodwill.
</ unfounded speculation>
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