The issue of accounting treatment of goodwill began in the year 1880-1929. Goodwill accounting emerged when the business form was changed from a sole proprietorship to a limited company because, according to Hughes, the development of goodwill paralleled the development of the commercial enterprise. (As cited by Garcia, 2006) During that period, the useful life of goodwill became an important accounting issue. Dicksee argues that goodwill is a permanent asset on the balance sheet and an asset that is not appropriate to keep, which is why he proposes to immediately charge it to capital. (As cited by Garcia, 2006) However, there are some writers who advocate the conservative approach that goodwill should be gradually amortized over its income. Dicksee's argument is rejected by Hatfield as incompatible with valuation methods based on the capitalization of a finite series of excess earnings. (As cited by Garcia, 2006) Furthermore, during the year 1929-1959, the world is affected by the Great Depression. The Accounting Research Bulletin no. 24 is in favor of conservatism and the strengthening of accounting principles. Proponents of depreciation based their arguments on the historical cost principle, and the principle of matching costs with revenues gave them a crucial advantage since the recognition of goodwill is prohibited by the cost principle. (Garcia, 2006) Paton argues that goodwill is regarded as a presumably expiring cost and should be allocated to future revenues. (As cited by Garcia, 2006) Furthermore, the established matching principle requires that goodwill be amortized over its income. As Walker argued, goodwill should be charged to its income, which is similar to the proportion of the cost of any other business. (As cited...... middle of paper...... cash generating units that will benefit from the synergies of the aggregation. Each cash generating unit is annually subjected to an impairment test. Conclusion, debate regarding the recognition and measurement of goodwill, there is no solution in sight in the near future. Some researchers believe that the goodwill impairment test method is capable of reflecting better information in financial statements , but no one can guarantee whether this method really provides better information or is just a new opportunity to practice creative accounting (Feleaga, Feleaga, & Dragomir, 2011) Works Cited Garcia, C. (2006 How Accounting for Goodwill). based on underlying assumptions: a historical approach. Feleaga, L.,)..