Unlock the secrets behind seamless mergers and acquisitions with this essential Business Combinations Policy. Designed for finance professionals, auditors and executives, this tool demystifies the complex world of business combinations by providing clear, step-by-step guidance rooted in SEC regulations. From identifying whether a transaction qualifies as a business combination to mastering the nuances of fair value measurement and goodwill calculation, this policy walks you through every critical aspect of the acquisition process. 

What sets this policy apart is its focus on real-world application. You’ll find insights on recognizing and measuring intangible assets, classifying liabilities, handling leases, and navigating the disclosure requirements that keep your financial statements both compliant and compelling. The inclusion of recent SEC amendments ensures you’re equipped with up-to-date knowledge, while practical examples and definitions clarify key terms and scenarios. Whether you’re preparing for your next big deal or looking to strengthen your organization’s financial reporting, this audit tool offers the clarity and confidence you need to get it right.

Sample procedures include:

• A business combination occurs when the company obtains control of one or more businesses by acquiring their net assets or some or all of their equity interests that could be accomplished through the purchase of the assets or equity interests of a business.
• If the assets acquired are not a business, the company will account for the transaction or other event as an asset acquisition.
• When the fair value of consideration transferred plus any fair value of the noncontrolling interest in the acquiree is less than the fair value of net assets acquired, a gain from bargain purchase is recorded on the consolidated income statement in the accounting period that the acquisition takes place.
• There are certain intangible assets that are identified in a business combination that may have value but do not meet either the separability or contractual-legal criteria.