Advanced Financial Reporting: Accounting for Business Combinations and Preparation of Consolidated Financial Statements

In this module, you will learn how to prepare the consolidated financial statements after the acquisition date. The concept of accounting acquisition premium (AAP), and the methods to calculate identifiable and unidentifiable portions of the accounting acquisition premium will be introduced. You will also learn the effects of accounting acquisition premium on the consolidated financial statements and the relevant consolidation adjustments. Moreover, you will be introduced to intercompany inventory transactions and learn to make consolidation adjustments for intercompany inventory sales and intercompany inventory profits.

In this module, you will be introduced to more types of intercompany transactions as well as noncontrolling interests. You will learn the consolidation adjustments for intercompany transactions with depreciable assets and intercompany debt. The noncontrolling interest (NCI) will be introduced. You will learn the definition, calculation, and presentation of noncontrolling interest and net income attributable to NCI in the consolidated financial statements. You will also learn how to report consolidated retained earnings and the subsequent measurement of noncontrolling interests. Lastly, an example of consolidation with noncontrolling interest will be shown.

In this module, we will explore the accounting rules for changes in the percentage of ownership of a Subsidiary and other topics that relate to business combinations. You will learn how to account for a business combination that was achieved in stages, and how to calculate the gain or loss on deconsolidation of the Subsidiary. Also, you will be introduced to the situation in which the Subsidiary acquires shares of the Parent and learn the methods to measure and record the transaction.

In this module, you will be introduced to segment reporting and the goodwill impairment test. You will learn the rules for public companies to disclose segment information in the notes to annual and interim financial statements. You will also learn what information should be presented in the entity-wide disclosures, and when. Then, the methods for identifying the reporting units, qualitative assessment for goodwill impairment, and the quantitative one-step goodwill impairment test will be introduced. You will also learn the goodwill impairment test under IFRS and the rules for private companies to account for goodwill.