Chinese companies face a reckoning on “goodwill” amassed during the merger wave in the past few years, which leaves many worried about damaging write-downs going forward. Some say, given a slowdown of profit growth this year, there is a bigger chance for significant good impairment, a sword of Damocles over companies in the coming months.
Goodwill on the books of China A-share listed companies reached 1.45 trillion yuan by the end of the third quarter, exceeding 1.4 trillion yuan mark for the first time in history, according to their earnings reports.
That's 15.18 per cent higher than a year earlier and 4.05 per cent higher than the previous quarter.
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