How do you determine a CGU for goodwill allocation, and why is it politically sensitive?

A CGU is the smallest group of assets generating largely independent cash inflows. Goodwill is allocated to the CGU or group of CGUs expected to benefit from the acquisition. It is politically sensitive because broader CGUs can absorb underperformance and avoid impairment, while narrower CGUs make impairment more likely. Auditors focus on whether the CGU level matches internal reporting and management monitoring.