In this category you can find all posts related to Business combination topic (mainly IFRS 3)

Tools ‹ IFRS LIST.COM – The online community about IAS IFRS, Accounting and Auditing — WordPress

Tools ‹ IFRS LIST.COM – The online community about IAS IFRS, Accounting and Auditing — WordPress. Related posts:IFRS: a help or a headache? Apply for MSc in Accounting and Control in Amsterdam Request for auditing standard Assistance for Audit...

Goodwill Calculation

Dear Members Please advice on the below query Company A buys 70% shares of Company B and become the holding company during 2008. so while preparing accounts for the year 2008, goodwill is calculated. Now in 2009, Company A acquires additional shares but the share holding remains the same. so while preparing accounts for 2009, [...]

By |September 23rd, 2010|BUSINESS COMBINATION|7 Comments

Consolidation After Merge

If  company (A) has a subsidiary(b) during acquisition no goodwill was recognized  then the subsidiary (b) was merged with another company resulted for change it's capital structure , so the Investment of (A) at (b) is now greater than it's share of  new capital of (b) is the difference recognized as goodwill or what please Help


Minority Interst

Do I still need to account for a 1% minority interest? Are receivable from shareholders (part of share capital) eliminated in consolidation or not.

By |August 22nd, 2010|BUSINESS COMBINATION|5 Comments

Financial Statement Consolidation

If the subsidiary was established prior to the parent company, what are the possible complications? I.e. because the Holdings require higher initial capital the management decided that once the subsidiary generates revenue. the revenue can be use to fund the share capital of the parent. On the establishment of the subsidiary the shareholders put more [...]


Acquisition – Business Combination

How do i record an acquisition without investment made by the parent to the subsidiary?

By |August 19th, 2010|BUSINESS COMBINATION|4 Comments

Gain on Bargain Purchase (IFRS 3)

Looking for an example of a company that has recorded a gain on a bargain purchase resulting from a business combination. Ideal if it was a mining company. Thanks Gord

By |May 13th, 2010|BUSINESS COMBINATION|6 Comments

Retained losses on Investment in subsidiary

If a subsidiary has a retained losses and it increase from year to year In the parent separate financial statement as Subsidiary was recognized at cost Is there is a need to impairment or write down the cost of the investment of this subsidiary??


IFRS 3 – Business Combination

Dear All, My question is that, in a situation of merger or business combination, where the structure is such that a new company A is formed to take over the businesses of B and C. The question is whether IFRS 3 Business Combinations is applicable in this case as practically the entire IFRS 3 is [...]

By |May 18th, 2009|BUSINESS COMBINATION|4 Comments

Consolidation – IFRS

Dear All, Please let me know the treatment of Existing negative goodwill incase of first time adoption of IFRS Regards Chirag


Entries – Consolidation of financial statements

Dear All, Request your valuable advice on the entries to be passed in the books of 1. Consolidated company 2. Stand Alone Parent Company for the purchase of shares on March 1,2009 and also the treatment of Goodwill. Company X had already acquired 50 % ...


Business Combinations, Consolidation (IFRS 3 and IAS 27) literature

Hello, I am an Austrian student and I would like to write about consolidation. More specifically I am going to write a comparison between full consolidated corporations and consolidation at equity. As far as I know, equity consolidation exists as te...


How to account intragroup trading under Business combination

Dear all, I need clarification with regard to how to treat an intra group trading b/n parent and subsidiaries group accounts during preparation of consolidated statement of financial position as well as income statement. I always confuse and need a clear guideline on how to treat it. For instance the subsidiary sold to the parent [...]

By |March 10th, 2009|BUSINESS COMBINATION|5 Comments

Loss / profit from joint venture / subsidiary

Dear Experts, Do we need to pass an entry for share of loss / profit in joint venture in the books of subsidiary stand alone books FS and also the same in the books of parent company stand alone books. or to be considered only for out of books consolidation purposes.

By |February 14th, 2009|BUSINESS COMBINATION|3 Comments

In case of newly established Subsidiary

In case of newly established subsidiary, which have not stared his commercial activities and in construction phase, is it require to consolidate it or we can show it on cost. Plz tell me What will be the right treatement


Acquisition accounting

Dear all, I have a question in relation to acquisition accounting in accordance with IFRS3. In this case a parent company A acquires all the shares in subsidiary company B for (say) 50M. This cost price represents a goodwill over the fair value of the ...

Effective date of business combination

Suppose Entity A acquires Entity B in a business combination and all the considerations have been completed by 31 December 2007 except that government approval which was still pending as at year end. Should entity A consolidate Entity B as at 31 December 2007? Regards, Nyasha I believe the answer lies in the issue of [...]

By |August 28th, 2008|BUSINESS COMBINATION|0 Comments

IFRS 3 Business Combination

Dear All, one of our Client has purchased a 100 % interest in a Subsidiarywhich is loss Making…   He has passed the following entry in their own books   Goodwill DR                120,000 Investment CR                          20,000       (Equity of subsidiary) Payable to subsidiary              100,000        (purchase price)   My question is can Investment AC be -VE at initiation. and as far as i remember the initial recognition of an asset should be at its cost.and my plea to the Client is that the entry should be   Investment DR 100,000                  Payable           100,000 and goodwill be shown in Consolidated ACs.   Kindly comment….and correct me if i am wrong.   Regards I think the entry you proposed is correct as goodwill from acquisition would only be shown in consolidated a/c.  […]

By |August 28th, 2008|BUSINESS COMBINATION|0 Comments