Overview
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Inputs, Processes, and Outputs (ASC 805-10-55-4)
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Controlling Financial Interest
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E&Y – Acquisition Date Preceding Closing Date
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Contractual-Legal Criterion Examples (ASC 805-20-55-2)
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Customer Related Identifiable Intangible Assets
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Operating Leases in a Business Combination
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Estimating Fair Value of a Noncontrolling Interest – E&Y Views
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Employee Benefits (ASC 805-20-30-15)
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FASB Basis for Conclusions for FAS 141(r) – B320 & B321
Course Description
As businesses grow and expand into global markets, complicated mergers and acquisitions become everyday occurrences. The increase in merger and acquisition activity brought greater attention to the fact that two transactions that are economically similar may be accounted for differently by companies, and thus, produce dramatically different financial results.
Also, the growing volume of international business combinations heightened the urgency to eliminate cross-border differences in accounting standards for business combinations. There is currently an ongoing project to converge IFRS (International Financial Reporting Standards) with Generally Accepted Accounting Principles (U.S. GAAP). The definition of a business in GAAP is currently identical to the definition in IFRS, however, stakeholders have noted that the definition of a business is generally not applied as broadly in jurisdictions that apply IFRS as in jurisdictions that apply GAAP.
This program reviews the current FASB authoritative guidance dealing with business combinations, including Accounting Standards Update 2017-01, 2018-09, and 2019-06.
Learning Objectives
- To identify the definition of a business as it relates to a business combination transaction
- To recall the steps involved in the acquisition method
- To identify the acquisition date for a business combination
- To recognize principles and exceptions in the measurement of assets and liabilities of a business combination
- To recognize the differences between the various categories of intangible assets
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