The format of this course is a Live Webinar. A detailed set of instructions on the Live Webinar will be sent to you closer to date.

Introduction

Accounting Standards dealing with acquisition and merger (M&A) activities are evolving overtime to keep pace with the constant changing business environments. Acquisition of a business can often involved myriad of transactions being exchanged between the acquirer and the vendor. These transactions can range from a simple cash payment to swapping of assets and liabilities, issue of complex financial instruments and deferred settlement subject to contingencies. Upon completion of a M&A transaction, the acquirer needs to account for additional line items such as goodwill, intangible assets, contingent liabilities and often including non-controlling interest in the consolidated financial statements and the investment interest in the separate financial statement.
 
Programme Objectives

This seminar takes a systematic approach to enhance a preparer’s skills in handling the accounting for M&A activities by:

1^st        Handling the initial accounting for acquisition of a business:

• To provide a step-by-step guide on applying the principle of business combination
• Acquisition of an entity that does not constitute a business

 
2^nd       Handling the subsequent maintenance accounting:

• The consolidation of investment interest
• Accounting for the complex issues of changes in investment interest
• Maintenance and impairment of goodwill

Programme Outline

1ST INITIAL ACCOUNTING
 
Acquisition of a business
 

• Scope and general issues
  • Determine a ‘business’
  • Identifying the acquirer
  • Identify common control
  • Treatment of business combination involving common control
  • The importance of identifying acquisition date
  • Dealing with changes provisional value in initial measurement period

 

• Accounting for investment interests in the separate financial statement of an investor
  • Dealing with acquisition related costs
  • Accounting for consideration transferred
  • Treating contingent consideration

 

• Valuation and accounting for identifiable assets and liabilities of acquiree:
  • Determining fair value of identifiable assets acquired and liabilities assumed
  • Reacquired rights
  • Accounting for contingent liabilities of acquiree:
  • Recognizing and measuring deferred tax at date of acquisition for:
    • Fair value changes to the carrying amount of acquiree’s assets and liabilities
    • Pre-acquisition unused tax losses carried forward of acquiree

 

• Dealing with non-controlling interest
  • Valuing non-controlling interest
  • Goodwill attributable to non-controlling interest
  • Subsequent changes in interest in non-controlling interest

 

• Business combination achieve in stages
  • Calculating goodwill at date of acquisition
  • Accounting for subsequent increase in equity interest

 

• Accounting for goodwill arising from business combination (IAS36)

 
 
2nd SUBSEQUENT ACCOUNTING:
 
1. Investment in subsidiaries

• Accounting for cost of investment in separate financial statements of an investor
• Impairment of the cost of investment

 
2. Issues in consolidated financial statements
 

• Dealing with changes in investment interest:
  • Acquisition in stages without obtaining control
  • Acquisition in stages resulted in obtaining control
  • Disposal in stages without losing control
  • Disposal in stages that resulted in losing control
  • Bonus and rights issue
  • Reverse acquisition

 

• Exempt Entities Consideration
  • Definition and identification
  • Acquisition and disposal of investment interest by Exempt Entities

 

• The interaction between business combination and consolidated financial statements
  • How to deal with acquisition of a controlling interest in an entity that does not constitute a business
  • How to deal with acquisition of a business without acquiring a controlling interest in an entity

 
Training Methodology
Lecture style, with practical illustrations, technical flow-charts, conceptual “mind maps” and interactive discussions.
 
Closing Date for Registration
1 week before programme or until full enrolment

Intended For

This programme is suitable for all Finance Professionals, Audit Professionals, Members of Audit Committee, Finance Directors and Regulators. Those who are keen on attending a practical course that examines the initial accounting for business combination and the subsequent accounting for maintenance of goodwill and changes in investment interest as well as the consolidation procedures are welcome to attend.

Programme Facilitator(s)