Goodwill
The amount a company pays for an acquisition above the value of the acquired business's separate assets less its liabilities.
Goodwill reflects things a buyer pays for but cannot separately record, such as reputation, customer relationships and expected synergies, as well as any overpayment. Under Ind AS it is not amortised; it is tested for impairment every year.
Large goodwill write-downs usually mean an acquisition has disappointed.
Example
Paying ₹300 crore for a company whose net assets are worth ₹180 crore creates ₹120 crore of goodwill.
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