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Track 13 of 19 · Specialized

Business combinations and consolidations (ASC 805, 810, 323 and 350)

Accounting for acquisitions under ASC 805, goodwill under ASC 350 including the private company alternatives, consolidation under the VIE and voting interest models of ASC 810, noncontrolling interests, the equity method under ASC 323 and pushdown accounting, followed by how an audit team tests a purchase price allocation and a group under AU-C 540, 620 and 600.

14 lessonsAbout 62 minASC 805 · ASC 810 · ASC 323 · ASC 350 · ASU 2017-04 · ASU 2014-02 · AU-C 600
0 of 14 complete
Syllabus

For: Audit staff and seniors on clients that acquire businesses or report consolidated groups, and controllers who prepare acquisition and consolidation workpapers.

  1. 01The acquisition method: scope, the definition of a business and the four stepsWhen ASC 805 applies, how the ASU 2017-01 screen separates a business from an asset purchase, and the four steps of the acquisition method.5 min · worked example · 4 self-check questions
  2. 02Identifying the acquirer and reverse acquisitionsHow to identify the accounting acquirer using Topic 810 control and the 805-10-55 factors, and how a reverse acquisition measures consideration.5 min · worked example · 4 self-check questions
  3. 03The measurement period and provisional amountsHow provisional amounts work, what qualifies as a measurement-period adjustment, and how ASU 2015-16 records the change in the current period.4 min · worked example · 4 self-check questions
  4. 04Recognizing intangible assets in a business combinationThe contractual-legal and separability criteria, common intangible classes, valuation methods, and the ASU 2014-18 private company alternative.4 min · worked example · 4 self-check questions
  5. 05Contingent consideration and earnoutsHow earnouts are measured at fair value, classified as liability or equity, remeasured after closing, and split from compensation for continuing employees.4 min · worked example · 4 self-check questions
  6. 06Bargain purchases and the reassessment stepWhen a business combination produces a gain, the reassessment ASC 805 requires before recognizing it, and how the gain is presented and disclosed.4 min · worked example · 3 self-check questions
  7. 07Goodwill impairment under ASU 2017-04 and the private company alternativesThe one-step goodwill impairment test, the tax-deductible goodwill gross-up, and the ASU 2014-02 and ASU 2021-03 alternatives for private companies.5 min · worked example · 4 self-check questions
  8. 08The VIE model versus the voting interest modelThe order of the Topic 810 analysis: scope exceptions, variable interests, the five VIE characteristics, the voting model and the ASU 2018-17 alternative.5 min · worked example · 4 self-check questions
  9. 09The primary beneficiary of a variable interest entityThe power and economics criteria, shared power, kick-out rights, decision-maker fees, related parties and how the primary beneficiary measures a VIE.5 min · worked example · 4 self-check questions
  10. 10Consolidation procedures and intercompany eliminationsHow to build consolidated statements: align policies and periods, eliminate the investment, intercompany balances, transactions and unrealized profit.4 min · worked example · 4 self-check questions
  11. 11Noncontrolling interests: measurement, presentation and changes in ownershipMeasuring NCI, attributing income and losses, presenting NCI in equity, and accounting for ownership changes with and without loss of control.4 min · worked example · 4 self-check questions
  12. 12The equity method under ASC 323 and basis differencesWhen significant influence exists, how the equity method records income, basis differences, intra-entity profit, losses and impairment, and ASU 2016-07.4 min · worked example · 4 self-check questions
  13. 13Pushdown accounting under ASU 2014-17When an acquiree may push down the acquirer’s new basis, what goes into its separate statements, what stays out, and how the election is disclosed.4 min · worked example · 4 self-check questions
  14. 14Auditing a business combination: AU-C 540, 620 and 600How auditors test a purchase price allocation and consolidation: estimates under AU-C 540, valuation specialists under AU-C 620, and group audits under AU-C 600.5 min · worked example · 5 self-check questions
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