Business Combinations under IFRS 3/FAS 141 - Mazars - United Kingdom
Business Combinations under IFRS 3/FAS 141
IFRS 3 ‘Business combinations’ and its requirement to separately recognise identifiable intangible assets from goodwill introduced much greater transparency in financial statements.
IFRS 3 requires a much more robust approach in ascertaining the fair value of net assets acquired in a business combination and hence the fair value of acquired intangible assets. The revised version of the Standard has further changed the way in which acquisitions are accounted for.
Some of the intangible assets that need to be separately recognised under IFRS 3 include: customer lists, brands, royalty agreements, trademarks, databases and magazine titles.
We have carried out many valuations of such items under both IFRS 3 and its US equivalent, FAS 141. Specifically, we can provide support and advice to:
- Identify the intangible assets that should be separately recognised on balance sheet
- Carry out valuations of each separately intangible asset for determining appropriate fair values to recognise
- Conduct the impairment reviews that will be at least an annual occurrence under IFRS
- Provide you with a formal valuation report and analysis designed to withstand the rigorous scrutiny of auditors, investors and regulators.
Given the potential effects on future earnings of incorrectly valuing assets on acquisition, having an experienced independent valuer on hand to help you with the process may prove essential.
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IFRS3 Valuation and accounting services
With so much to consider when acquiring a business, it’s easy to overlook the accounting issues which could significantly impact market perceptions of the deal.
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- Copyright 2012 - Mazars - United Kingdom
