The introduction of International Financial Reporting Standard 3 ‘Business combinations’ (IFRS 3) and its requirement to recognise separately from goodwill identifiable intangible assets will introduce much greater transparency in financial statements.
It will also require a much more robust approach in ascertaining the fair value of net assets acquired in a business combination.
Some of the intangible assets that need to be separately recognised under IFRS 3 include: trade marks, brands, royalty agreements, databases, customer lists and magazine titles.
Our Financial Reporting Advisory team has carried out valuations of such items under both IFRS 3 and its US equivalent, FAS 141. We can help your company provide the investment community with assurance that the process has been rigorously conducted and is free from management bias.
We can also help conduct the impairment reviews that will be at least an annual occurrence under IFRS. 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.
Please click here to download the IFRS3 Valuation and accounting services brochure.
