A few days ago Jeb Bush opined that all Americans should be working harder to support his 4% growth target for GDP.
At the same time, Microsoft announced they were writing down over 7 billion dollars in “goodwill” off their accounting books related to the purchase of Nokia, and at the same time laying off over 7,800 people.
I’d like Jeb to look in the eyes of those layed off by Microsoft and tell them they need to work harder to cover up for Microsoft management’s apparent mistake in purchasing Nokia.
You see, Microsoft wrote off more in “goodwill” due to that purchase, than they paid in total price for Nokia.
So in effect they doubled their expenditures in outlay, damaged their own goodwill with consumers (that’s what “goodwill” is after all) and laid off 7,800 employees to reduce expenses to try to make up for management’s mistake.
Microsoft has also been supporting H1B visas, bemoaning the lack of qualified workers in the United States.
Surely the management team of Microsoft could reduce some of their own salaries, stock options, etc to cover up for their own mistakes?
You’d think so, at least.
I’m sure those well qualified Microsoft employees felt they were working quite hard.
An intangible asset that arises as a result of the acquisition of one company by another for a premium value. The value of a company’s brand name, solid customer base, good customer relations, good employee relations and any patents or proprietary technology represent goodwill. Goodwill is considered an intangible asset because it is not a physical asset like buildings or equipment. The goodwill account can be found in the assets portion of a company’s balance sheet.