Business Combinations under Common Control – International Standards Board
Date recorded:
At its meeting on April 9-11, 2019, the Board directed the staff to continue developing measurement approaches for transactions within the scope of the project by considering:
- whether and how transactions within the scope of the project can be different from business combinations that are not under common control;
- what information would be useful to various primary users of the receiving entity’s financial statements;
- whether the benefits of providing particular information would justify the costs of providing that information; and
- complexity and structuring opportunities that could arise under various approaches. The Board also tentatively decided that it need not pursue a single measurement approach for all transactions within the scope of the project.
Specifically, the Board could pursue:
- a current value approach for all or some transactions that affect non-controlling shareholders in the receiving entity; and
- a different approach, such as a form of predecessor approach, for transactions that affect lenders and other creditors in the receiving entity but do not affect non-controlling shareholders. The Board expects to continue its discussions on measurement approaches for transactions within the scope of the project at future meetings.
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