While accounting for internally generated goodwill has been shown to have

received only limited attention from accounting theorists and standard set-

ters, this has not been the case with respect to purchased goodwill. The

reason for this is clear. The purchase of goodwill is an identifiable transac-

tion, unlike the development of internally generated goodwill. It results in

identifiable expenditure, often substantial, which requires to be accounted

for in some way because it fits within the historical cost framework. This chapter examines the previous attempts to account for purchased goodwill.

The following chapter examines the prescriptions of the current Australian

and comparable international Standards.