I am struggling with an accounting concept and would be grateful for some guidance in respect of when Goodwill arises.
So I understand that Goodwill can arise as a result of the investment / consolidation process.
However, in a set of accounts I am reviewing a subsidiary has Goodwill on their balance sheet and the subsidary's accounts are not consolidated and nor have they invested/ bought shares in another company.
I do however believe that the subsidary did not start their business, but instead bought a care home business and that business then became the sole business of the subsidiary company.
If anyone could clarify when goodwill can appear (specifically outside of consolidated accounts) that would be great!
For further reference this company also has a parent company so I understand why goodwill would arise for the parent / as a result of the consolidation procsss, but am really struggling to see why it appears at the subsidiary level.
Thanks in advance!