Section 1582 - Business combinations

Effective date:

January 1, 2011 except for subsequent amendments

Published by the AcSB:

December 2009


Reach out to our Section 1582 Specialist

Diana De Acetis


A business combination is a transaction or other event in which an acquirer obtains control over one or more businesses. An enterprise shall account for each business combination by applying the acquisition method. The acquisition method requires:

  1. identifying the acquirer
  2. determining the acquisition date
  3. recognizing and measuring the identifiable assets acquired and liabilities assumed and any non-controlling interest in the acquiree and
  4. recognizing and measuring any goodwill or a gain from a bargain purchase.

The acquirer measures the identifiable assets acquired and liabilities assumed at their acquisition-date fair values, except where otherwise specified in the Section. The Section provides guidance on matters such as determining what is part of the business combination, accounting for contingent consideration, measurement period adjustments and the required disclosures.

History of Section 1582




December 2009

Part II of the CPA Canada Handbook  issued

Effective for fiscal years beginning on or after January 1, 2011.

October 2012

Annual improvements

Paragraph .55 has been amended to extend the exception to the general requirement to expense acquisition costs to the cost of issuing debt securities.

October 2013

Annual improvements

This Section has been amended as follows:

  • Paragraph .60(b) has been amended to clarify that contingent consideration is remeasured at fair value when the contingency is resolved.
  • Paragraph .62 has been amended and paragraph .62A has been added to require only certain disclosures when the subsidiary is accounted for under the cost or equity method.

October 2015

Annual improvements

Paragraph 1582.62A has been amended to clarify the disclosure requirements when a business combination is achieved through the acquisition of an asset or group of assets. Effective for fiscal years beginning on or after January 1, 2016. Earlier application is permitted.

Note: The above summary does not include details of consequential amendments made as the result of other projects.


Private Enterprise Advisory Committee Meeting Notes

  • June 11, 2015 - 2015 Annual Improvements: Proposed amendments to Section 1582, 3051 and 3462, be approved as exposed
  • April 1, 2015 - Accounting for a subsidiary and an investment using the cost method
  • December 17, 2014 - 2015 Annual Improvements: Disclosure of Acquisition of Assets in a Business Combination
  • September 16, 2014 - Annual Improvements 2015: Disclosure of Acquisition of Assets in a Business Combination

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.