Dialogue with standard setters

By | 2018-05-28T18:41:06+01:00 May 28th, 2018|

Monda Mario, Fiume Raffaele / Financial Reporting / 1-2018

There had been several international accounting principles about the accounting treatment for business combinations, over the past years. Last June 2016, the International Accounting Standards Board proposed to amend IFRS 3 Business Combinations with the aim of clarifying the definition of a business. The motivation that pushed the Board to propose the Exposure Draft was to inform that there is a diversity in practice in accounting for previously held interests in the assets and liabilities of a joint operation in two kinds of transaction, those in which an entity obtains control of a business that is a joint operation and those in which it obtains joint control of a business that is a join operation. The purpose of the following review is to identify whether the board has reached the desired objective, and leads through the historical analysis of the accounting standards concerning business combinations, the analysis of the Exposure Draft and especially the analysis of the comments letters.

Business combinations, IFRS3, Exposure Draft, Purchase Method, Screening test

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Towards the international convergence of accounting standards: the case of Business Combinations and Goodwill

By | 2017-12-27T14:12:19+01:00 December 27th, 2017|

Olante Maria Elena/ Financial ReportingRiviste /Fascicolo: 2-2014

Accounting for business combinations and for goodwill has profoundly changed during the last ten years both in the US and in Europe, as a consequence of the common effort of the FASB and the IASB towards the international convergence of accounting standards. The Business Combinations project has been the first major project undertaken jointly by the accounting standard setters and it has resulted in the issue of substantially converged accounting standards with some remaining differences. The aim of this paper is to review and comment the evolution and the major changes occurred in accounting for business combinations and for goodwill and their current status in the light of the process of convergence of accounting standards on these crucial economic transactions.

Keywords: Business combinations, goodwill, IFRS, USGAAP